HiL > 2016/17 Studiehåndbok > INN3027/1 Pricing and revenue management

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Pricing and revenue management

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Language of instruction - English
Telefon: 612 88000

Course description:

Pricing and revenue optimization have been used at airlines and hotels for a long time, while markdown management systems are in a period of rapid adoption at retailers. Dynamic and customized pricing are also being developed for a number of other industries.  

The course “Pricing and revenue management” provides a comprehensive introduction to how various companies should set and (frequently) adjust their prices on goods, services, and events, in order to maximize profitability. With increasing competition within most business areas, price is one of the most important variable in order to improve operating profit.

Examples of topics that will be covered in the course are:

  • Basic price optimization
  • Price differentiation
  • Pricing with constrained supply
  • Revenue management
  • Markdown management
  • Customized pricing

Additionally, the course will briefly include the topic “price hedonism”, where the objective is to analyze what attributes, and to what degree, they contribute to the overall price on various goods and services.

One of the most important goals for the course is to provide the students with the insights and tools that enable them to help a future manager to identify and capture pricing and revenue optimization opportunities. Pricing and revenue management is a relatively new and “hot” topic, and there are potentially many interesting research questions that can be addressed in Master theses. It would be particularly interesting to apply many of the now known techniques on pricing and revenue optimization to new (local) markets.  Analyses of potential improvements in operating profit for local businesses within the tourism and event industry would be particularly interesting.


Learning outcomes:


  • Be able to identify what opportunities various companies might have to apply pricing and revenue management.
  • Understand the critical differences among different types of opportunities and approaches needed to address them.
  • Understand and be able to explain key concepts such as; (1) the impact of constrained capacity, (2) opportunity costs, (3) customer response, (4) demand uncertainty, and (5) market segmentation.


  • Formulate decision problems within price and revenue management for companies/events.
  • Model real decision problems within price and revenue management using spreadsheets / appropriate software.
  • Implement the obtained results for (imaginary / real) companies / events within different business areas.
  • Understand and discuss what prices of various goods and services consist of from a price hedonistic point of view.


  • Assess what opportunities and limitations that are present by applying price and revenue management as tools in order to improve a company’s profitability.
  • Be able to propose various pricing models and implement these, using the appropriate software, in private/public companies.


Pedagogical methods, teaching and learning strategies:

Lectures, exercises, group work, case-reports, student presentations of research articles, self-study.


Written case-report. The rest will be announced at course start-up



1 day exam: Written report.


Grading: A - F

Full-time (part-time): Full-time

Duration: One semester

Recommended prerequisites:

Basic understanding of business economics, statistics, and optimization is an advantage.

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