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Dynamic capacity allocation for airlines with multi-channel distribution
Tongji Univ, Peoples R China.
Linköping University, Department of Management and Engineering, Production Economics. Linköping University, Faculty of Science & Engineering.ORCID iD: 0000-0003-3058-7431
Tongji Univ, Peoples R China.
2018 (English)In: Journal of Air Transport Management, ISSN 0969-6997, E-ISSN 1873-2089, Vol. 69, p. 173-181Article in journal (Refereed) Published
Abstract [en]

Due to fierce competition in markets, recently, many airlines have faced the challenge of reducing channel distribution costs. However, channel distribution decisions are often made separately from inventory allocation decisions in practice. Thus, in this study, we propose a dynamic programming model to derive the optimal policy and investigate customer-shift behaviours in a problem setting with the above two issues combined. The numerical experiment results illustrate that introducing the channel distribution into the airline revenue system significantly improves the revenues and efficiently reduces the channel distribution costs. The improvement comes mainly from a better match between channels and fare classes and a subsequent risk reduction of revenue losses.

Place, publisher, year, edition, pages
ELSEVIER SCI LTD , 2018. Vol. 69, p. 173-181
Keywords [en]
Multi-channel distribution; Capacity allocation; Airlines; Revenue management
National Category
Other Civil Engineering
Identifiers
URN: urn:nbn:se:liu:diva-149735DOI: 10.1016/j.jairtraman.2018.02.006ISI: 000434753400014OAI: oai:DiVA.org:liu-149735DiVA, id: diva2:1234373
Note

Funding Agencies|National Natural Science Foundation of China [71371140]

Available from: 2018-07-24 Created: 2018-07-24 Last updated: 2019-06-27

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  • nn-NB
  • sv-SE
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