Pricing Analytics

Pricing analytics and revenue management focuses on how a firm should model demand, set and update pricing and product availability decisions across its various selling channels in order to maximize its profitability. The use of such strategies has transformed the transportation and hospitality industries, and they are increasingly important in retail, telecommunications, entertainment, financial services, health care and manufacturing.

Within the broader area of pricing theory, the course places emphasis on tactical optimization of pricing and capacity allocation decisions, tackled using demand modeling and constrained optimization – the two main building blocks of revenue management systems.

Case studies provide hands-on experience of the subject. Students are using R for most of the exercises within the RStudio environment, involving training on both demand modeling and optimization problems.

• Ability to explain, apply and implement fundamental price optimization approaches to business problems
• Ability to recognize the business conditions conductive to application of pricing analytics
• Ability to model demand (using a limited range of methods) and to estimate price elasticities

Exam: 60%

The group assignment is formative, whereas the exam is summative