The application of airline yield management techniques to a holiday retail shopping setting

Most airlines utilize a revenue maximizing technique called yield management (YM), which allows the airlines to allocate their fixed capacity of seats to various fare categories in the most profitable manner possible. The discriminatory pricing goal is to sell only non‐discounted seats to the business travel segment. Suggests that yield management techniques may also be appropriate in certain retail settings where capacity (i.e. product inventory) is not necessarily “perishable” in the same sense as unsold seats on an airline flight however, its value may decline with the culmination of a well‐defined shopping period (e.g. the “Christmas holiday” shopping period). Examines how knowledge of customer price sensitivity as it pertains to this shopping period, coupled with the appropriate use of discount pricing, can maximize the revenue gained from sales of a seasonal product associated with a specific holiday.