The arrivals forecast is one of the key inputs for a successful hotel revenue management system, but no research on the best forecasting method has been conducted. In this research, we used data from Choice Hotels and Marriott Hotels to test a variety of forecasting methods and to determine the most accurate method. Preliminary results using the Choice Hotel data show that pickup methods and re...

Revenue Management (RM) is a technique that applies economic principles to system variables in order to maximize revenue. The focus of hotel RM, as perceived by most hospitality practitioners and researchers, is room revenue maximization. Available software products do not use any high level information and do not use sophisticated prediction models. In this paper we propose a conceptual RM mod...

Using five years of data collected from a small and independent hotel in The Netherlands this case study explores RMS data as a means to seek new insights into occupancy forecasting. The study provides an insight into the random nature of group cancellations, an important but neglected aspect in hotel revenue management modeling. The empirical study also shows that in a local market context dem...

Mihir Rajopadhye, Mounir Ben Ghaliay and Paul P. Wang Department of Electrical and Computer Engineering Duke University Durham, North Carolina 27708-0291 Timothy Baker and Craig V. Eister Bass Hotels and Resorts Atlanta, Georgia 30346-2149 Abstract Economic systems are characterized by increasing uncertainty in their dynamics. This increasing uncertainty is likely to incur bad decisions that ca...

I describe the customer valuations game, a simple intuitive game that can serve as a foundation for teaching revenue management. The game requires little or no preparation, props or software, takes around two hours (and hence can be finished in one session), and illustrates the formation of classical (airline and hotel) revenue management mechanisms such as advanced purchase discounts, booking ...

Human decision making is error-prone and often subject to biases. Important information cues are misweighted and feedback delays hamper learning. Experimentally, task information has been shown to be valuable in improving decision making. However, such information is rarely available. Generalizing from lab-based approaches, we present a new field methodology for the “Diagnosis of Decision Quali...

Revenue management has become an important tool in the airline, hotel, and rental car industries. We describe asymptotic properties of revenue management policies derived from the solution of a deterministic optimization problem. Our primary results state that, within a stochastic and dynamic framework, solutions arising out of a single well-known linear program can be used to generate allocati...