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10 Examples of Yield Management

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Yield management is the pricing of service inventory that expires at a point in time such as a seat on an aircraft or night in a hotel room. This is critical to industries such as hospitality and transport that are capital intensive with inventories that continually expire each day. The following common examples of yield management techniques.

High Season

Carefully tracking which days are likely to have high demand and charging a higher price on these days.

Low Season

Identifying days that are likely to have low demand and aggressively discounting. This may have promotional support such as a sales campaign that is advertised.

Volume Sales

Selling a large amount of inventory in heavily discounted blocks to partners such as tour companies.

Loyalty Rewards

Offering free nights or free trips as part of loyalty rewards but only allowing these to be redeemed in low season.

Price Discrimination

Finding ways to differentiate between customers who are price sensitive and those who aren't. For example, charging more for flights that don't involve a weekend stay as a means to charge business travelers a higher price.

Terms & Conditions

Using terms and conditions as a means to differentiate between customers who are willing to pay more. For example, cheap tickets that can't be refunded, even months in advance.

Perks & Status

Offering perks and customer status to customers who are willing to pay more. This allows heavy discounting without impacting your most loyal and price insensitive customers. For example, cheap flights that don't include any reward points that would increase a customer's status.

Last Minute Prices

Low prices for last minute purchases for inventory that is likely to expire anyway.

Demand-based Pricing

Aggressively discounting for days that aren't selling well. This is often automated by algorithms.

Unpublished Prices

Not publishing lower prices whereby they can be selectively revealed to particular customers but not widely communicated. For example, walk-in prices at a hotel that aren't published on the internet.
Overview: Yield Management
The dynamic pricing of service inventory that expires at a point in time.
The goal of yield management is typically to find ways to charge price insensitive customers more while still achieving a high occupancy rate.
Related Concepts


This is the complete list of articles we have written about pricing.
Algorithmic Pricing
Bargaining Power
Benchmark Price
Price Fixing
Cost-plus Pricing
Price Gouging
Customary Pricing
Decoy Effect
Everyday Low Price
Marginal Utility
Willingness To Pay
Dynamic Pricing
High-Low Pricing
Market Value
Flat Pricing
Loss Leader
Predatory Pricing
Price Discrimination
Snob Effect
Market Price
Price Competition
Price Leadership
Premium Pricing
Price Economics
Price War
Revenue Management
Veblen Goods
Price Floor
Price Promotion
Price Sensitivity
Price Skimming
Price Umbrella
Pricing Power
Pricing Strategy
Sticky Prices
Value For Money
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