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Emerging price optimization models systematically incorporate competitor price information into the derivation of optimal price points. While consideration of competitor pricing at this tactical level is essential to maximizing short-term revenues, the long-term impact of competitive price positioning on revenue performance should not be overlooked. This study examines the effect of two key dimensions of strategic price positioning - relative price position and relative price fluctuation - on the revenue performance of 6998 US hotels over an 11-year period. It finds that revenue performance is strongest for hotels that price higher than the competition and maintain a consistent relative price over time. Implications for revenue management practitioners are discussed.


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© Palgrave Macmillan. Final version published as: Noone, B. M., Canina, L., & Enz, C. A. (2013). Strategic price positioning for revenue management: The effects of relative price position and fluctuation on performance. Journal of Revenue and Pricing Management, 12(3), 207-220. doi:/10.1057/rpm.2012.48

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