Yield management and recognition programs - how do they influence travellers' choices?

Abstract

Capacity constrained service firms simultaneously employ customer centric marketing (CCM) and perishable asset revenue management (PARM), which can create conflicts and perceived unfairness for the consumer. We first introduce a conceptual model to explain variations in customer demand as a result of fairness judgements. According to our model, purchase decisions for services are based on a) utility judgements of their product and price attributes, and b) a coding phase to adjust for any fairness issues. Focus group research provides first empirical support for all but two constructs of the model, and clarifies which PARM and CCM attributes matter most for airline travellers.