REVinsight

A type of availability control that does not allow new reservations to be taken for guests arriving on this date.

The only guests that are using inventory will be those arriving on earlier dates and staying over the said date.

The estimate of marginal value given that demand is uncertain.

EMR is the revenue multiplied by the probability that we sell the unit (probability that demand is greater than or equal too our supply).

Revenue × Probability of selling = EMR

Inventory, that if not used within a timeframe is lost revenue opportunity.

Markets composed of heterogeneous customers – customers that can be separated into various classes, differentiated by how much they are willing to pay for a product or service, by age, by frequency of purchase, or by affiliation with potentially profitable groups.

A modeling approach for settings where prior decisions affect the outcomes of current decisions, and therefore decisions are best made simultaneously rather than sequentially.

Uncertain demand that varies temporally by time of year, day-­‐of-­‐week, time of day, etc.

A measure of the demand for a particular service or product that is the sum of all consumers who have purchased or would purchase that product at a particular time. "Unconstrained" refers to the elimination (in theory) of the constraint of availability.

Of a sequence that is consistently increasing and never decreasing or consistently
decreasing and never increasing in value. In dynamic pricing, we refer to prices as
monotonic when they always increase or always decrease; monotonic price changes do
not fluctuate between increasing and decreasing.

Monotonically increasing prices
encourage consumers to book early—that is, they deter strategic waiting. Monotonically
decreasing prices would encourage consumers to wait.

An approach to pricing that introduces variations in price not associated with differences in the quality of the product or service nor with the cost of production.

The price customers think a service (or product) should cost. Reference prices may be based on the price last paid, the price most frequently paid, the price other customers say they paid for similar offerings, or on market prices and posted prices.

Inventory available–number of hotel rooms, seats on plane, etc.–owing to the nature of these businesses, the number of units that can be sold is a fixed number; when they are all sold, there is no more capacity.

A pricing strategy that does not vary prices according to demand, product characteristics, or segmentation of markets.