Term paper in
Service Management

Revenue Management: does it work for event providers?

Contents 1 Introduction 1 2 Theory 1 2.1 Definition 1 2.1.1 Literature Review 2 2.1.2 Working Definition of Revenue Management 3 2.2 Criteria for Applications 3 2.3 Implementation of Revenue Management 5 2.3.1 Objectives for Establishing Prices 5 2.3.2 Pricing Strategy 5 2.4 Methods of Revenue Management 6 2.4.1 Price Discrimination 6 2.4.2 Capacity Control 8 2.4.3 Overbooking 9 2.4.4 Dynamic Pricing 9 3 Case „Theater Hagen“ 10 3.1 Review of the criteria for application 10 3.2 Description of used methods 11 4 Conclusion 13 5 Reference 14

List of figures 1.1 Interdependence between criteria....................................................................4 1.2 Criteria for market segmentation.....................................................................7 1.3 Theatre hall plan...............................................................................................11 1.4 Pricing table......................................................................................................12

Introduction
Revenue Management is pioneered by American airlines and is in practice since the “Airline-Deregulation-Act” from 1978. Since this act the airlines are free to set their prices the way they want to. Most of the airlines used this new opportunity to take advantage of their customer’s different levels of price sensitivity (Kimms & Klein, 2005, p. 2). Theoretically revenue management is part of the micro economical price theory and is often regarded as second degree price discrimination (Hermann Diller, 2007, p. 497).
This paper wants to give an overview over the theory behind revenue management. The first part will deal with the requirements for the implementation of a revenue management