Yield Management

What is Yield Management?

Yield management is a pricing strategy that adjusts prices based on demand, supply, and customer behavior to maximize revenue. It is commonly used in industries such as airlines, hotels, and car rentals, where fixed capacity and fluctuating demand require strategic pricing to optimize occupancy and revenue. The goal is to sell the right product to the right customer at the right time for the right price.

Key Elements of Yield Management

• Demand Forecasting: Predicting customer demand to adjust prices accordingly.
• Dynamic Pricing: Modifying prices in real time based on changes in demand and availability.
• Inventory Control: Managing the number of products or services available for sale at various price points.

Related Terms and Concepts

Dynamic pricing, revenue management, supply and demand, price optimization