Pricing and Revenue Optimization
Robert Phillips

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Table of Contents for Knowledge and Money

Table of Contents for

Pricing and Revenue Optimization

Preface

Chapter 1: Background and Introduction

1.1    Historical Background and Context

1.2    The Financial Impact of Pricing and Revenue Optimization

1.3    Organization of the Book

Chapter 2: Introduction to Pricing and Revenue Optimization

2.1    The Challenges of Pricing

2.2    Tradition Approaches to Pricing

2.3    The Scope of Pricing and Revenue Optimization

2.4    The Pricing and Revenue Optimization Process

2.5    Summary

2.6    Exercises

Chapter 3: Basic Price Optimization

3.1    The Price-Response Function

3.2    Price Response with Competition

3.3    Incremental Costs

3.4    The Basic Price Optimization Problem

3.5    Summary and Extensions

3.6    Exercises

Chapter 4: Price Differentiation

4.1    The Economics of Price Differentiation

4.2    Limits to Price Differentiation

4.3    Tactics for Price Differentiation

4.4    Volume Discounts

4.5    Calculating Differentiated Prices

4.6    Price Differentiation and Consumer Welfare

4.7    Summary

4.8    Exercises

Chapter 5: Pricing with Constrained Supply

5.1    The Nature of Supply Constraints

5.2    Optimal Pricing with a supply Constraint

5.3    Opportunity Cost

5.4    Market Segmentation and Supply Constraints

5.5    Variable Pricing

5.6    Variable Pricing in Action

5.7    Summary

5.8    Exercises

Chapter 6: Revenue Management

6.1    History

6.2    Levels of Revenue Management

6.3    Revenue Management Strategy

6.4    The System Context

6.5    Booking Control

6.6    Tactical Revenue Management

6.7    Net Contribution to Revenue Management

6.8    Measuring Revenue Management Effectiveness

6.9    Revenue Management in Action

6.10 Summary

6.11 Exercises

Chapter 7: Capacity Allocation

7.1    Introduction

7.2    The Two-Class Problem

7.3    Capacity Allocation with Multiple Fare Classes

7.4    Capacity Allocation with Dependent Demands

7.5    Capacity Allocation to Action

7.6    Measuring Capacity Allocation Effectiveness

7.7    Summary

7.8    Exercises

Chapter 8: Network Management

8.1    Background and Introduction

8.2    When is Network Management Applicable?

8.3    A Linear Programming Approach

8.4    Virtual Nesting

8.5    Network Bid Pricing

8.6    Dynamic Virtual Nesting

8.7    Network Management in Action

8.8    Summary

8.9    Exercises

Chapter 9: Overbooking

9.1    Introduction

9.2    A Model of Customer Bookings

9.3    Solution Approaches

9.4    Extensions

9.5    Measuring and Managing Overbooking

9.6    Alternatives to Overbooking

9.7    *Appendix: Derivation of the Show Probability for Overbooking

9.8    Exercises

Chapter 10: Markdown Management

10.1    Background

10.2    Markdown Optimization

10.3    Estimating Markdown Sensitivity

10.4    Markdown Management in Action

10.5    Summary

10.6    Exercises

Chapter 11: Customized Pricing

11.1    Background and Business Setting

11.2    Calculating Optimal Customized Prices

11.3    Bid Response

11.4    Extensions and Variations

11.5    Customized Pricing in Action

11.6    Exercise

Chapter 12: Pricing and Revenue Optimization and Customer Acceptance

12.1    Price Presentation

12.2    Fairness

12.3    Implications for Pricing and Revenue Optimization

12.4    Summary

12.5    Exercise

Appendix A: Optimization

A.1  Continuous Optimization

A.2  Linear Programming

A.3  Duality and Complementary Slackness

A.4  Discrete Optimization

Appendix B: Probability

B.1  Probability Distributions

B.2  Continuous Distributions

B.3  Discrete Distributions

Bibliography

Index