The impact of dynamic price variability on revenue maximization

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dc.contributor.authorAbrate, Grazianoen
dc.contributor.authorNicolau, Juan Luisen
dc.contributor.authorViglia, Giampaoloen
dc.date.accessioned2024-08-05T13:36:53Zen
dc.date.available2024-08-05T13:36:53Zen
dc.date.issued2019-10-01en
dc.description.abstractThe objective of this article is to analyze the effect of dynamic price variability on revenue maximization. While dynamic pricing is a common practice in tourism, this is the first comprehensive study on the relationship between price variability and revenue maximization. Within the framework provided by the literature on intertemporal price discrimination, price fairness, inventory controls and organizational culture, this research proposes and applies a new hedonic revenue model on a sample of 21,687 observations. The findings suggest that higher dynamic price variability leads to higher hotel revenues. Strategic room unavailability and review rating also exert a clear positive revenue impact. Overall, the benefits from charging different prices for the same service (intertemporal price discrimination) and limiting the number of units available before the demand is known (inventory control) outweigh the potential negative effects of price unfairness and organizational culture. The paper concludes by providing actionable levers for hospitality managers.en
dc.description.versionAccepted versionen
dc.format.extentPages 224-233en
dc.format.extent10 page(s)en
dc.format.mimetypeapplication/pdfen
dc.identifier.doihttps://doi.org/10.1016/j.tourman.2019.03.013en
dc.identifier.eissn1879-3193en
dc.identifier.issn0261-5177en
dc.identifier.orcidNicolau Gonzalbez, Juan [0000-0003-0048-2823]en
dc.identifier.urihttps://hdl.handle.net/10919/120847en
dc.identifier.volume74en
dc.language.isoenen
dc.publisherElsevieren
dc.relation.urihttp://gateway.webofknowledge.com/gateway/Gateway.cgi?GWVersion=2&SrcApp=PARTNER_APP&SrcAuth=LinksAMR&KeyUT=WOS:000469890300018&DestLinkType=FullRecord&DestApp=ALL_WOS&UsrCustomerID=930d57c9ac61a043676db62af60056c1en
dc.rightsCreative Commons Attribution 4.0 Internationalen
dc.rights.urihttp://creativecommons.org/licenses/by/4.0/en
dc.subjectIntertemporal price discriminationen
dc.subjectInventory controlen
dc.subjectPrice fairnessen
dc.subjectPricingen
dc.subjectRevenue managementen
dc.titleThe impact of dynamic price variability on revenue maximizationen
dc.title.serialTourism Managementen
dc.typeArticle - Refereeden
dc.type.dcmitypeTexten
dc.type.otherArticleen
dcterms.dateAccepted2019-03-23en
pubs.organisational-group/Virginia Techen
pubs.organisational-group/Virginia Tech/Pamplin College of Businessen
pubs.organisational-group/Virginia Tech/Pamplin College of Business/Hospitality and Tourism Managementen
pubs.organisational-group/Virginia Tech/All T&R Facultyen
pubs.organisational-group/Virginia Tech/Pamplin College of Business/PCOB T&R Facultyen

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