Discuss how successful airlines control the use of discount

Discuss how successful airlines control the use of discount fares by imposing and enforcing appropriate conditions on these fares, and how they utilize state-of-the art revenue management systems. Provide an example(s).

Solution

Revenue management is the process of maximising revenue from a fixed amount of perishable inventory using market segmentation and demand management techniques. Revenue management is considered an essential function of any airline due to the highly uncertain and competitive market place.

Airline companies implement revenue management to increase profits. It can be performed through seat inventory management.The reveue management in airlines industry depends upon factors such as customer behaviour, demand forecasting , control systems, variable cost factors, fare products etc.Seat selling is the major revenue of any airline industry.