ABSTRACT
This chapter explains the meaning and definition of revenue management and describes the history and evolution of revenue management. It identifies and describes the key ingredients of the revenue management process. The chapter also shows how to apply primary key performance indicators for measuring revenue management success. Revenue management found its way into the hotel industry in the early 1990s and ever since has been widely used to optimise inventory and pricing of hotel rooms. Over time, hotels started to introduce new concepts such as rate fences or booking restrictions. The general principle underlying these concepts is to link the price of a room to the time of purchase. Even though revenue management was only introduced in the 1990s and could thus be considered to represent a relatively new concept, it has developed into a strategic discipline that plays a crucial role in the success or failure of most hotels.
