Definitions of Revenue Management

Question 1

Define Overbooking

Answer 1

process of accepting bookings greater than the aircraft physical capacity in order to compensate cancellations, no-shows, and duplicate bookings

Question 2

Define Recapture

Answer 2

probability of capturing a passenger whose initial request for booking denied

Question 3

Define Spoilage

Answer 3

loss of revenue due to protecting seats for higher revenue passengers that may not materialize

Question 4

Define Dilution

Answer 4

loss of revenue due to selling a low fare seat to a customer who would be willing to pay more

Question 5

Define Spill

Answer 5

portion of the booking demand that is not accommodated

Question 6

Define Bid Price

Answer 6

minimum acceptable price for the next available seat

Question 7

Define Protection level

Answer 7

number of seats reserved exclusively for a fare class not to be sold to lower fare classes

Question 8

Define BOB

Answer 8

also known as buy-on-board, buy things on the airplane

Question 9

What is Yield Management?

Answer 9

Average price paid per person

Question 10

What is load factor?

Answer 10

Number of bums in the seat

Question 11

What is CASM?

Answer 11

Cost per Available Seat Miles

Question 12

What RASM?

Answer 12

Revenue per Available Seat Miles

Question 13

What is PACT?

Answer 13

WestJet (Proactive Communication Team)

Question 14

What is WHY?

Answer 14

We Hear You

Question 15

What is the % of IQ and EQ in the airline industry?

Answer 15

IQ = 30%
EQ = 70%