Dynamic switching times from season to single tickets in sports and entertainment

Duran S., Swann J. L., Yakici E.

OPTIMIZATION LETTERS, cilt.6, sa.6, ss.1185-1206, 2012 (SCI-Expanded) identifier identifier

  • Yayın Türü: Makale / Tam Makale
  • Cilt numarası: 6 Sayı: 6
  • Basım Tarihi: 2012
  • Doi Numarası: 10.1007/s11590-011-0361-8
  • Dergi Adı: OPTIMIZATION LETTERS
  • Derginin Tarandığı İndeksler: Science Citation Index Expanded (SCI-EXPANDED), Scopus
  • Sayfa Sayıları: ss.1185-1206
  • Anahtar Kelimeler: Revenue management, Sports and entertainment industry, Stopping times, Bundled tickets, REVENUE MANAGEMENT, MONOPOLY, SALES
  • Orta Doğu Teknik Üniversitesi Adresli: Evet

Özet

Revenue management can be used in many industries where there is a limited, perishable capacity and the market can be segmented. In this paper we focus on the sales of event tickets in the Sports and Entertainment industries, where tickets are sold exclusively as season tickets initially or as single events later in the selling horizon. We specifically study the optimal time to switch between these market segments dynamically as a function of the state of the system. Under Poisson demand processes, we find the optimal switching time is a set of time thresholds that depends on the remaining inventory and time left in the horizon. We use numerical experiments to show that significant profit improvements can be obtained by dynamically deciding the optimal switch time over the case when the date is announced in advance. We also study an extension where "early switch to a low-demand event" is allowed.