PROS®, a provider of SaaS solutions optimizing shopping and selling experiences, highlighted the power of its willingness-to-pay (WTP) forecasting and optimization technology with the implementation at Malaysia Airlines. WTP is available in PROS RM Advantage, an edition of Airline Revenue Management, that gives airlines access to the latest in technology and revenue management best practices and workflows. With WTP, airlines can overcome common buy-down challenges in priceable demand markets by utilizing the power of artificial intelligence (AI) and pricing science at scale to improve demand forecasting and inventory management and to drive efficiency across all aspects of their revenue optimization programs.
As travel demand continues to increase, airlines are refining their business strategies that require innovative solutions to accelerate revenue and to capitalize on a stronger recovery. Moreover, revenue management teams want greater control over fares and offers to meet evolving passenger expectations. The optimal path to achieve this is through leveraging AI-powered capabilities that deliver real-time demand forecasting and inventory control. By having the power to price beyond a static price point and in between two fares, revenue managers can capture much-needed incremental revenue.
“Malaysia Airlines operates in a highly competitive environment, where evolving passenger demands and buy-down are real challenges that we must continually overcome,” said Malaysia Airlines Berhad Group Chief Executive Officer Captain Izham. “With PROS WTP capabilities, Malaysia Airlines can deliver a personalized offering for every passenger, tailored to their needs and ultimately giving them more choice in offers that they book, while at the same time enhancing revenue.”
WTP is a method in which demand is forecast as a function of price to ultimately capture the price sensitivity of customers – something traditional forecasting methods cannot easily achieve. PROS WTP forecasting is designed to scientifically predict the price sensitivity of passenger demand, incorporate that price sensitivity into an optimization algorithm, and then adjust seat availability based on the optimal decision. PROS WTP is implemented using the PROS Bayesian forecast engine, which has an established track record of success within the airline industry as the model can continuously learn and update itself while receiving new data and information.
PROS RM Advantage is part of the PROS Platform for Travel which connects the critical pieces of revenue management, offer creation, distribution and digital retailing to reduce inefficiency and create consistent and revenue optimal offers across all channels.
“Airlines today are looking for advanced, proven ways to improve revenue generation,” said PROS President, Travel Benson Yuen. “Malaysia Airlines’ adoption of willingness-to-pay methodology is a testament of its focus to undertake transformation by adopting new revenue management innovations and to drive efficiency across its revenue optimization program. PROS is proud of its long-standing partnership with Malaysia Airlines.”
