Research on dynamic pricing model of electronic airplane ticket in electronic commerce

Authors:
Zhe Guo;Ikou Kaku;Jiafu Tang;Dingwei Wang;Shixin Liu
Affiliations:
School of Information Science and Engineering, Northeastern University, Shenyang, China;Department of Management Science Engineering, Akita Prefectural University, Akita, Japan;School of Information Science and Engineering, Northeastern University, Shenyang, China;School of Information Science and Engineering, Northeastern University, Shenyang, China;School of Information Science and Engineering, Northeastern University, Shenyang, China
Venue:
CCDC'09 Proceedings of the 21st annual international conference on Chinese control and decision conference
Year:
2009

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Abstract

The distinctive characteristics of electronic airplane ticket make its pricing method different from traditional pricing method. According to the different demands of passengers about the seats, electronic airplane ticket was sorted into multi-class. The income of each class of electronic airplane ticket was analyzed, considering its click number online and probability of passengers purchase. For the sake of maximizing the gross revenue of electronic airplane ticket, real-time multi-class dynamic pricing model was built at revenue management point of view. Then the state parameters in the math model were analyzed according to the operation status of Airline Company in practice. The recursion of the math model was deduced and proved. The results of experimentation verified that the methods are practical in computational efficiency and more close to practice.