Abstract
Revenue management is the control of selling a limited quantity of a resource to a potential set of customers. Motivated by practical problems in three different sectors, we explore the strategies that managers employ to maximize revenue while navigating various capacity and pricing constraints.
In the first essay, focusing on the context of a single live event, we define the managers' decision problem as the Event Ticket Pricing (ETP) problem and formulate it as a constrained non-linear optimization problem. The ETP problem we constructed incorporates constraints based on capacity considerations and pricing restrictions. Our formulation for the ETP problem is robust and can embed many demand functions. Importantly, our analysis of the optimal solution to the ETP problem reveals vital insights for live entertainment promotion planners facing insufficient supply and customer emotional concerns.
Our second essay delves into the revenue management issue in the hotel industry, particularly investigating the effect of loyalty programs on hotel profits under various scenarios in the context of price and capacity restrictions. Given tourists' price and quality sensitivities, we assume the competition between two vertically differentiated hotels over prices and capacities and against the loyalty program. Through formulating unilateral/bilateral award sale problems, we probe the circumstances under which hotels can benefit from reward sales-factors that heavily depend on quality differentiation, the size of the loyal customer group, and the reimbursement rate.
In the third essay, we shift our focus to the rapidly evolving world of live-streaming events-a highly promising promotional instrument and sales channel in the e-commerce landscape. We identify
that certain prevalent issues and challenges have seldom been approached from a modeling perspective. By constructing game theoretic models based on key characteristics of the live-streaming industry, we characterize equilibrium and examine how the live-streaming channel influences manufacturers' pricing decisions.