Abstract
Market segmentation techniques have played an extraordinarily important role in successful revenue management programs. For example, purchase fences allowed companies to sell a single product at multiple prices, simultaneously, to customers that self-selected into different customer segments, based on willingness-to-pay. As revenue management expanded to more industries, new approaches to market segmentation became possible. The financial benefits associated with successful implementations have been extraordinary. This article discusses how market segmentation techniques have evolved in support of revenue management and dynamic pricing practices and what companies and customers may be able to look forward to in the future.
Similar content being viewed by others
Notes
Seat maps obtained during flight search at www.aa.com
References
Bodea, T. and Ferguson, M. (2014) Segmentation, Revenue Management, and Pricing Analytics. New York: Routledge.
Acknowledgements
The author would like to express his appreciation to Scott Nason, former VP, Revenue Management for American Airlines for his insightful comments and feedback as well as his colleagues Bruce Patty and Jim Mullin at Veritec Solutions for their suggestions.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Lieberman, W. The evolution of market segmentation in revenue management and dynamic pricing. J Revenue Pricing Manag 15, 283–292 (2016). https://doi.org/10.1057/rpm.2016.11
Received:
Revised:
Published:
Issue Date:
DOI: https://doi.org/10.1057/rpm.2016.11