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An approach to offer management: maximizing sales with fare products and ancillaries

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  • Ben Vinod

    (Sabre Research)

  • Richard Ratliff

    (Sabre Research)

  • Vikram Jayaram

    (Sabre Research)

Abstract

With the growth in ancillary sales, an area of increasing importance for airlines is the concept of offer management, which entails the creation of dynamic, custom, personalized offers consisting of a flight itinerary and ancillary products offered by an airline. This practice-oriented, overview paper provides an end-to-end, future-oriented framework for determining the composition of optimal base fare and ancillary bundles by customer trip-purpose segment followed by 1:1 personalization to maximize total sales. Our focus in this paper is primarily on the proposed offer management framework and its sub-components.

Suggested Citation

  • Ben Vinod & Richard Ratliff & Vikram Jayaram, 2018. "An approach to offer management: maximizing sales with fare products and ancillaries," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 17(2), pages 91-101, April.
    • Handle: RePEc:pal:jorapm:v:17:y:2018:i:2:d:10.1057_s41272-017-0121-1
    DOI: 10.1057/s41272-017-0121-1
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    References listed on IDEAS

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    Cited by:

    1. MadhuSudan Rao Kummara & Bhaskara Rao Guntreddy & Ines Garcia Vega & Yun Hsuan Tai, 2021. "Dynamic pricing of ancillaries using machine learning: one step closer to full offer optimization," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 20(6), pages 646-653, December.
    2. Stacey Mumbower & Susan Hotle & Laurie A. Garrow, 2023. "Highly debated but still unbundled: The evolution of U.S. airline ancillary products and pricing strategies," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 22(4), pages 276-293, August.
    3. Kevin K. Wang & Michael D. Wittman & Adam Bockelie, 2021. "Dynamic offer generation in airline revenue management," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 20(6), pages 654-668, December.
    4. Daniel Schubert & Christa Sys & Rosário Macário, 2022. "Customized airline offer management: a conceptual architecture," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 21(5), pages 553-563, October.
    5. Tomasz Szymanski & Ross Darrow, 2021. "Shelf placement optimization for air products," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 20(3), pages 322-329, June.
    6. B. Vinod, 2021. "Advances in revenue management: the last frontier," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 20(1), pages 15-20, February.
    7. B. Vinod, 2021. "Artificial Intelligence in travel," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 20(3), pages 368-375, June.
    8. Michael Byrd & Ross Darrow, 2021. "A note on the advantage of context in Thompson sampling," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 20(3), pages 316-321, June.
    9. Michal Sznajder & Richard Ratliff & Cuneyd Kaya, 2023. "A heuristic for incorporating ancillaries into air choice models with personalization (Part 1: estimating preferences using hedonic regression)," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 22(2), pages 122-139, April.
    10. Muzaffer Buyruk & Ertan Güner, 2022. "Personalization in airline revenue management: an overview and future outlook," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 21(2), pages 129-139, April.
    11. Kevin K. Wang & Michael D. Wittman & Thomas Fiig, 2023. "Dynamic offer creation for airline ancillaries using a Markov chain choice model," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 22(2), pages 103-121, April.
    12. B. Vinod, 2021. "The age of intelligent retailing: personalized offers in travel for a segment of ONE," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 20(4), pages 473-479, August.
    13. Michal Sznajder & Richard Ratliff & Cuneyd Kaya, 2023. "A heuristic for incorporating ancillaries into air choice models with personalization (part 2: integrated multinomial logit and hedonic regression models)," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 22(2), pages 140-151, April.

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