We develop an innovative framework to study how hoteliers apply inventory control and price discrimination taking into account seasonality. We end up with a time-varying model that, using publicly available information, connects the early booking and last-minute pricing decisions. In doing so, we account for the expected demand size and price elasticity, the inventory put on sales, and the last-minute demand shocks. An analysis focused on 100 hotels in Milan (Italy) shows that during the Covid-19 last-minute discounts/surcharges remain stable over long periods while the role of advance booking as a lever for revenue management is reduced. Moreover, the pandemic has increased the last-minute adjustment at the short advance booking, especially for midweek days.
Hotel dynamic pricing, stochastic demand and covid-19 / Guizzardi, Andrea; Ballestra, Luca Vincenzo; D'Innocenzo, Enzo. - In: ANNALS OF TOURISM RESEARCH. - ISSN 0160-7383. - ELETTRONICO. - 97:(2022), pp. 103495-103510. [10.1016/j.annals.2022.103495]
Hotel dynamic pricing, stochastic demand and covid-19
Guizzardi, Andrea;Ballestra, Luca Vincenzo;D'Innocenzo, Enzo
2022
Abstract
We develop an innovative framework to study how hoteliers apply inventory control and price discrimination taking into account seasonality. We end up with a time-varying model that, using publicly available information, connects the early booking and last-minute pricing decisions. In doing so, we account for the expected demand size and price elasticity, the inventory put on sales, and the last-minute demand shocks. An analysis focused on 100 hotels in Milan (Italy) shows that during the Covid-19 last-minute discounts/surcharges remain stable over long periods while the role of advance booking as a lever for revenue management is reduced. Moreover, the pandemic has increased the last-minute adjustment at the short advance booking, especially for midweek days.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.