Qualitative revenue management in sun-and-beach hotels

Abstract

The introduction of the internet as a sales channel has pressed hotel companies to adopt new pricing policies, most notably revenue management (RM). These techniques have been heralded as an essential requirement for hotel companies to maximise profits. The present study, however, will show that this claim is not realistic for a leading, highly competitive destination like Ibiza. The analysis finds that there is strong price stability and that only a few hotels use RM. It is common, however, to find qualitative RM that involves removing cheaper room types and room-and-board options from the available offering when demand is high.