If you have a hotel, there are good chances that you have heard of these terms at least once. However, not everyone knows what are yield and revenue management and how they work. Do not worry: In this post we are bringing a bit of light into the darkness.

The expressions yield and revenue management indicate the income management, a capacity management system that aims to optimize and maximize the business volume. In other words, yield and revenue management are designed to control capacity in such a way that the return is as high as possible.

Generally, the income management instruments are used when a few prerequisites are met. A fixed and limited capacity, bookings or sales made before the actual consumption, a constantly changing and unpredictable demand, undifferentiated product or services offer to customers with different buying habits and.

A hotel therefore falls into the category of those activities, which can be optimized with the methods of yield and revenue management. The entertainment industry also relies on this approach, as do the mobile phone providers.

Applying these to your products and services means, in simple terms, to perform real-time pricing taking into account a series of data and key factors.

Need an example? A hotelier might decide to reserve some of his rooms for guests with a longer stay. Of course, he is taking the risk that the rooms remain empty, but the booking is made and any losses resulting from the vacancy are absorbed by the longer stay.

Are there any differences between yield and revenue management?

Now that we understand better what the yield and revenue management are and how they work, we need to understand what are the differences between the two.

As a matter of fact, there are only few, because yield and revenue management are two strategies one resulting in another. What changes is the parameter on which they focus, as well as the purpose.

The yield management is primarily concerned with enhancing profits and that is how it gives the activity to the revenue management, focused on the optimization pulling the pricing lever.

Eventually, the revenue management is a more comprehensive term and the yield management can be under circumstances seen as a part of it. They are interlinked and hardly to separate one from the other.

Yield and revenue management for hotels in the South Tyrol

After this brief introduction to the terminology, the basic concept of yield and revenue management should be clear.However, you do not really need to know more, because we at Genetica have several years of experience applying the yield and revenue management for hotels in South Tyrol.

If you are interested, please take a look at our case studies. They show best how we work. And if you are convinced that this is the right thing for your hotel, do not hesitate to contact us!

Flavio Pintarelli

Author Flavio Pintarelli

Copywriter&Media Director, ha una smodata passione per la scrittura.

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