Dynamic pricing in lodging industry: Case of European hotels

Abstract

Master thesis is devoted to the problem of an optimal choice of dynamic pricing strategy in hospitality industry. The paper examines current pricing trends on four European markets: Amsterdam. London, Rome and Vienna and defines a set of factors that influence hotel’s decision related to the choice of mark-up and mark-down pricing strategies. Those factors include hotel’s room availability star rating, affiliation to a chain, competitors’ rate pressure and external political or social events. The paper also studies pricing practices adopted by the best performing hotels on the market (Revenue generation index more than 1). Dased on this benchmark managerial recommendations on implementation of mark-up and mark-down policies under different market conditions have been worked-out.