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Revenue maximization in service systems with heterogeneous customers

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  • Bodas, Tejas
  • Manjunath, D.

Abstract

In this paper, we consider revenue maximization problems for service systems with heterogeneous customers. To extract meaningful insights, we consider a simplified two queue system where each server charges an admission price to its customers. The customers differ in their cost for unit delay and this customer heterogeneity is modeled as a random variable with distribution F. On arrival, the customers must choose a server that offers the lowest sum of admission price and the expected delay cost.

Suggested Citation

  • Bodas, Tejas & Manjunath, D., 2019. "Revenue maximization in service systems with heterogeneous customers," European Journal of Operational Research, Elsevier, vol. 278(2), pages 686-698.
    • Handle: RePEc:eee:ejores:v:278:y:2019:i:2:p:686-698
    DOI: 10.1016/j.ejor.2019.04.041
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    References listed on IDEAS

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    Cited by:

    1. Sun, Wei & Zhang, Zhiyuan & Xie, Xumeng & Li, Shiyong, 2024. "Heterogeneity of delay information and revenue-cost structure in a multi-server queue with threshold policy: Customer behaviors and optimization," Applied Mathematics and Computation, Elsevier, vol. 465(C).
    2. Gu, Wei & Heese, H. Sebastian & Kemahlıoğlu-Ziya, Eda & Ziya, Serhan, 2024. "Pricing for services with cross-segment externalities, capacity constraints, and competition," European Journal of Operational Research, Elsevier, vol. 313(2), pages 801-813.

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