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Customer profitability analysis an avant-garde approach to revenue optimisation in hotels

Author

Listed:
  • Anand Iyengar
  • Ketan Suri

Abstract

The widespread use of customer relationship management systems has provided hospitality/hotel organisations with detailed insights into the profitability of their individual customers and at the same time have highlighted unprofitable patrons. Critically appreciating contributions in the area of customer profitability analysis (CPA), this paper provides a retrospective (management accounting) and prospective (customer lifetime value) approach to estimate profitability of customer/guest segments in the hotel business environment. The research enumerates antecedents and outcomes of CPA and proposes an integrated framework to render robustness to the prevalent revenue management systems.

Suggested Citation

  • Anand Iyengar & Ketan Suri, 2012. "Customer profitability analysis an avant-garde approach to revenue optimisation in hotels," International Journal of Revenue Management, Inderscience Enterprises Ltd, vol. 6(1/2), pages 127-143.
    • Handle: RePEc:ids:ijrevm:v:6:y:2012:i:1/2:p:127-143
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    References listed on IDEAS

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    1. Bo Hu Ferns & Ruomei Feng & Siu-Ian So & Alastair M. Morrison, 2010. "Member segmentation of vacation travel club: price sensitivity and member status," International Journal of Revenue Management, Inderscience Enterprises Ltd, vol. 4(3/4), pages 284-305.
    2. Haenlein, Michael & Kaplan, Andreas M., 2009. "Unprofitable customers and their management," Business Horizons, Elsevier, vol. 52(1), pages 89-97.
    3. Mats Carlback, 2010. "From cost accounting to customer accounting in the restaurant industry," International Journal of Revenue Management, Inderscience Enterprises Ltd, vol. 4(3/4), pages 403-419.
    4. Kate Varini & Cathy Burgess, 2010. "Maximising profits: Do revenue managers have the skills?," International Journal of Revenue Management, Inderscience Enterprises Ltd, vol. 4(2), pages 163-178.
    5. Wen-Chyuan Chiang & Jason C.H. Chen & Xiaojing Xu, 2007. "An overview of research on revenue management: current issues and future research," International Journal of Revenue Management, Inderscience Enterprises Ltd, vol. 1(1), pages 97-128.
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