Revenue Management consists of all that we have talked about in previous articles. To recap it consists of Segment Pricing, Fenced Pricing, Capacity Management, Forecasting and Balanced Revenue Mix. Now, continuing with the theme of Balanced Revenue Mix I now want to go deeper into what can happen when a Maturity Mismatch occurs. First, letContinue reading “Maturity Mismatch (Revenue Mismatch)”
Monthly Archives: August 2021
Balanced Revenue Mix
Maintaining balanced revenue and profit is critical for any company. When using Segment Pricing and Fenced pricing along with Revenue Management it is important to monitor how much revenue is sold at which price and profit levels. In the chart below (from a real company) I have demonstrated what I consider to be a healthyContinue reading “Balanced Revenue Mix”
Segment Cost Types
Previously I have mentioned that customers don’t care about costs, they only care about products or services that meet their price points for what they desire. However, costs are an important part of any company’s marketing strategy. And there are many different types of costs. It is important that a company knows how to understandContinue reading “Segment Cost Types”
Forecasting
Forecasting is extremely important. It drives all aspects of a company’s business. Forecasting drives pricing decisions, strategic planning, manpower levels, assets such as trucks, ships or airplanes, etc. More accurate forecasting results in a company being more efficient. Forecasts allow companies to run revenue simulations as well as cost simulations to allow management to runContinue reading “Forecasting”
Capacity Management
Capacity Management is also known as Allocation or Allotment Management depending on which company you work for, but these terms are interchangeable. In the service sector Capacity Management is key to managing supply and demand. As illustrated in the chart below Capacity is the supply. Pricing manages demand. And Revenue Management brings both of thoseContinue reading “Capacity Management”
Revenue Management
We have talked about Segment Pricing as well as Fenced Pricing in previous articles so now we will keep building on those concepts and discuss the next concept known as Revenue Management. Revenue Management is a termed used (and often misused) in many industries for many different functions, however the accurate definition of Revenue ManagementContinue reading “Revenue Management”
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