Optimal Selling Strategies: Application of Hotel Revenue Management
Optimal Selling Strategies: Application of Hotel Revenue Management

Summary/Abstract: The purpose of this paper is to study optimal selling strategies when a hotel faces a stochastic and dynamic arrival of guests from different market segments, considering fixed capacity and a finite planning horizon. In this paper we present two models that differ in the degree of complexity in terms of the assumptions considered. The first model determines the optimal policy for renting hotel rooms when there is only one type of room and there is no reservations made at the beginning of the target date (i.e. guests show up without making previous reservations). Then, we extended this model in order to include the case of multiple type rooms with possibility of downgrading. The second model determines the optimal policy for renting hotel rooms when there is multiply type of rooms and there is possibility to make reservations.

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