How the science behind revenue management is helping Alaska Airlines drive transformation in challenging times

June 30, 2022

3 min read

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Benjamin Cany

Vice President Product & Strategy, AI Delivery Hub - Amadeus

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Travel demand has been ebbing and flowing in unpredictable ways over the last few years, and therefore revenue management has never been more important. Revenue management is critical to airlines because it allows them to better anticipate and deliver on customer demand to maximize revenues and yields.

When Alaska Airlines was looking for a revenue management solution (RMS) that could bring maximum flexibility and agility to monitor changing market developments and understand customer’s willingness to pay, it reached out to Amadeus.

The technology backing Amadeus’s RMS is cutting edge and unique. The role of AI, machine learning and data in Revenue Management cannot be emphasized enough – Amadeus has been at the forefront of adapting machine learning to the revenue management discipline to help airlines efficiently forecast passenger demand and willingness to pay. By leveraging real-time data, airlines can accurately forecast demand based on customer purchasing behaviour, competitor pricing, and yield capacity. In addition, easy-to-use dashboards allow airline analysts and business teams the ability to react decisively to RMS intelligence and changing market conditions. The sophisticated algorithms and customer choice modelling are best-in-class in the RMS scientific community, thanks to Amadeus’ consistent innovation to help airlines maximize returns and improve competitiveness in the market.

Previously, only airlines using Altéa, Amadeus’ passenger service system (PSS)—which includes an airline reservations system, an airline inventory system and a departure control system—were able to benefit fromAmadeus Revenue Management solution . Now, Amadeus offers RMS as a PSS-agnostic solution and any airline can use Amadeus’ RMS. Alaska Airlines is the very first non-Altéa passenger service system airline to implement Amadeus’ revenue management solution. It has experienced notablebusiness benefitsfrom having a better understanding of its passenger needs and more time to focus on strategic decision making. And despite a raging pandemic, Amadeus implemented the RMS solution smoothly and on schedule.

Today, Alaska Airlines benefits from configurable dashboards that help its teams take faster, better, and more informed decisions. It is ahead of the game with a future-proof, open and configurable RMS. The RMS is natively integrated into our openAmadeus Airline Platform , which was designed to help airlines easily collaborate with partners and other third parties to enable modern digital retailing.

Most importantly, Amadeus technical and functional experts continue to work with Alaska Airlines to ensure maximum business benefits as it supports RMS deployment and usage with best practices. The Amadeus Revenue Management R&D and Machine Learning Services team work together to continuously define new data-driven models and new revenue management techniques, such as a competitor-aware revenue management system and Active Forecast Adjustment.

To learn more about our partnership with Alaska Airlines,read our latest case study .

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