In light of the increase observed in average daily rates over the last few years, hoteliers are increasingly inclined to be in favour of flexible rates to stay in line with the market’s fluctuating needs. But while “dynamic pricing” is commonly accepted within a yield management strategy, it makes business clientele, who are accustomed to negotiated fixed rates that vary in function of the volume of nights, cringe.
A few years ago the Coca- Cola Company triggered much criticism when it experimented with vending machines that could adjust their prices as the mercury rose or dropped. And yet, the idea actually aimed more at dropping the price in a slow period to stimulate sales than at increasing them during hot...
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