Abstract
A wide range of new industries will join airlines, hospitality and travel companies in embracing revenue management (RM) as an essential component of their business strategies. Large databases of consumer information developed to improve ‘customer relationship management’ (CRM) will provide inputs to consumer choice models, which will in turn allow prices to be set based on estimates of demand elasticity. At the same time, continued advances in optimisation techniques and computation speed will allow different price-product combinations to be offered to each individual consumer. Joint optimisation of price and inventory, combined with realtime updates based on the most current demand forecasts and available inventory, will generate incremental revenue gains that exceed those realised to date.
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1holds a Master of Science in Transportation and a PhD in Flight Transportation from the Massachusetts Institute of Technology. His doctoral dissertation entitled, ‘Air Travel Demand and Airline Seat Inventory Management’, is widely recognised as the first PhD thesis published on the topic of airline revenue management. In his dissertation, Dr Belobaba described the expected marginal seat revenue (EMSR) models now used as a basis for seat inventory optimisation by many airline revenue management systems worldwide. Dr Belobaba is currently Principal Research Scientist at the MIT International Center for Air Transportation, where he teaches graduate-level courses in air transportation economics and airline management. He is also a Visiting Professor of Aviation Management in the IATA International Aviation MBA Program at Concordia University in Montreal. Dr Belobaba has been involved in research and consulting related to airline revenue management systems since 1985. He presently manages an MIT research consortium funded by seven major airlines to explore the areas of airline pricing, demand forecasting, network revenue optimisation, and simulation of the competitive impacts of revenue management. Dr Belobaba has also worked as a consultant on the evaluation, development and implementation of revenue management systems at over thirty airlines and travel companies worldwide. He has published articles dealing with revenue management and airline competition in Airline Business, Operations Research, Transportation Science, Decision Sciences and the Journal of Air Transport Management.
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Belobaba, P. Back to the future? Directions for revenue management. J Revenue Pricing Manag 1, 87–89 (2002). https://doi.org/10.1057/palgrave.rpm.5170009
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DOI: https://doi.org/10.1057/palgrave.rpm.5170009