Yield management is a pricing strategy by which any business that has a fixed number of products can optimise revenue. It is the process of selling the right product to the right customer at the right time.
Demand-based pricing of fixed-time, limited resources such as hotel rooms, rental cars, train, plane and bus tickets is a familiar concept, with most people willing to pay different prices for the same product at peak times or out of season.
Ride-sharing app Uber manages revenue in peak times with surge pricing: Fare rates automatically increase as demand outstrips the supply of available drivers near the passenger’s location, ensuring a reliable service for those people who are prepared to pay a premium for not having to wait. Users who would rather avoid the price hike are notified via the app when the price drops again.
Can it work for parking?