Launching customer TACA now benefits from optimal pricing in real time
TACA is the first airline worldwide to optimize its pricing processes and increase its revenues by using Dynamic Price Engine (DPE). After Lufthansa Systems has implemented its next generation revenue management solution the leading Latin-American airline now can evaluate booking requests in real time and respond with the optimal price.
"By deploying the Dynamic Price Engine, we gain even more flexibility and significant competitive advantages through optimal pricing in real time and by optimizing distribution costs," explains Mario Cruz, Revenue Management and Pricing Manager at TACA, the airline's decision to enhance their revenue management system. The airline has been successfully using revenue management solution ProfitLine/Yield O&D (Origin & Destination) from Lufthansa Systems since 2005.
With its DPE, Lufthansa Systems has developed an innovative tool that enables network airlines to improve their position when directly competing with low-cost carriers. Network carriers traditionally use a static price concept with strictly defined booking classes, while low-cost carriers work with a simple staggered price model. By deploying the DPE airlines can combine both models. As soon as they arrive, all booking requests are evaluated in real time on the basis of various criteria, including the point of sale, the requested travel route (Origin & Destination) and the prices of the competitors. Then the system automatically responds to each request using either traditional booking classes or a low-fare model.
„This innovative solution enables TACA to always take the current market situation into account in order to offer the optimal price. It provides a fully integrated approach to revenue management and pricing that leads to real time dynamic pricing," says Dr. Ulrike Gall, Senior Vice President Airline Management Solutions at Lufthansa Systems. "The implementation of the Dynamic Price Engine for our launching customer TACA is a further testimony to our in-depth airline expertise and extensive IT know-how."
Since 2005, TACA has been using an extensive package of IT solutions from Lufthansa Systems to handle its core processes. The Central American airline optimizes its revenue management and pricing (ProfitLine), crew und fleet management (NetLine), flight planning (Lido OC) and passenger management with IT from Lufthansa Systems. The IT provider operates all systems in its own data center.