Not any more. That isn't just a trend in designer beers. In its place, we now have millions of individual market segments. The same Friday night airline seat is worth a lot more to a business person headed home than to a student in search of a cheap weekend trip. May. So, a revenue-managed system seeks to define different market niches, match price and product to specific markets, and price goods and services based on value rather than cost.
Revenue management can have an astonishing effect on revenues and profitability.
Revenue management asserts as a general principle that it makes a lot more sense to juice up revenues than to slash costs. Robert Cross helped to pioneer the science of revenue management at Delta Airlines when profits plummeted in the wake of airline deregulation. Running revenue management in those industries is very high tech. It involves huge historical databases, sophisticated forecasting models, extensive computer simulation, and the repetitive processing of mountains of data. When done at that level, it is an exacting and expensive undertaking.