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Journal cover: Journal of Services Marketing

Journal of Services Marketing

ISSN: 0887-6045

Online from: 1987

Subject Area: Marketing

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Yield management, dynamic pricing and CRM in telecommunications

Document Information:
Title:Yield management, dynamic pricing and CRM in telecommunications
Author(s):Frédéric Jallat, (ESCP-EAP, European School of Management, Paris Graduate School of Business, Paris, France), Fabio Ancarani, (Alma Mater Studiorum, University of Bologna, Forli, Italy)
Citation:Frédéric Jallat, Fabio Ancarani, (2008) "Yield management, dynamic pricing and CRM in telecommunications", Journal of Services Marketing, Vol. 22 Iss: 6, pp.465 - 478
Keywords:Customer relations, Services marketing, Telecommunications, Yield management
Article type:Research paper
DOI:10.1108/08876040810901882 (Permanent URL)
Publisher:Emerald Group Publishing Limited
Acknowledgements:This article is part of two broader research projects on marketing strategies in convergent industries and on customer relationship management. Bocconi University and Club International at ESCP-EAP have respectively funded a stream of the research focused on the definition and measurement of the convergence phenomenon on one hand, on the use of technologies to integrate customer relationship management and market research on the other hand.

Purpose – The purpose of this paper is to show how yield management and dynamic pricing, which originated in the airline industry, are now diffusing in other service industries. The aim is to demonstrate that these techniques can be profitably applied to telecommunications and similar sectors and to examine the particular conditions of their implementation, development and efficiency.

Design/methodology/approach – The main concepts of yield management, dynamic pricing and CRM are carefully scrutinized. Also discussed is the concept of natural demand curve that aims at reaching a better compromise between the capacity of a company and the demand in an environment where services cannot be sold in advance. In order to sustain the analysis and demonstrate its managerial implications, five case studies are presented that exemplify some aspects of yield management techniques in the telecommunication sector.

Findings – Since the telecommunications are undergoing a process of increased competition and dynamic convergence, yield management techniques can help telecom operators to optimize the benefits they can derive from a subtle management of information networks and partnerships. However, such an approach is more difficult to implement in the telecommunication industry than in the airlines sector because of the difficulty to control (and sometimes refuse) network access to customers.

Originality/value – Capacity and revenue management become critical differentiation factors in improving service quality, loyalty and profitability. Given the increase in competitive pressure, the main objective of operators to sell customer access database to potential partners represents a radical change in the nature of financial and information flows and leads to a “customized management of services supply”.

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