Gymnasium revenue management is a real time pricing, that is, at the right price at the right time to sell appropriate products to the appropriate customer, so as to achieve maximum benefits. For sports venues utilization low, and mismanagement of status, from proceeds management optimization theory of angle, think sports venues applies proceeds management of features including not storage, and capacity relative fixed, and can ahead of reservation, and demand fluctuations sexual large; elaborated has proceeds management in sports venues operating in the specific application of policy has customer classification and the demand forecast, and excess reservation, and pricing, and optimization control,; last made proceeds management in sports venues operating in the should note system bound, and thought concept of obstacles, and applies of sports venues management information system, and history data accumulation, and processing Super sales, problem.
Sports complex is not only a place for fitness activities and sports training and competition venues, is an important symbol of the region’s social and economic development also reflect advanced culture. With the development of the society and people’s health and awareness-raising, sports venue is a scarce and important social resource “. But for a long time, gymnasium poor management, inadequate utilization, directly influence the development of mass sports in China. For example, Tianhe Sports Center in Guangzhou and Nanjing wutaishan Sports Center, in downtown of Tianhe Sports Center, covers an area of 420,000 m2, the annual income of 30 million Yuan and wutaishan Sports Center which covers an area of only 10,000 m2, but because of their unified management, annual income of up to $ 27 million. Visible although Tianhe Sports Center has a larger venue resource advantages, but has yet to play a role. Therefore, how to further enliven stadiums, improving its operating efficiency, make full play of multi-function, gymnasium of explore scientific, rational and efficient management is imperative. Important feature of the gymnasium is the inability to adjust the supply capacity in the short term, similar to other service sectors, important question of how to balance supply and demand as gymnasium.
In other countries, present a special management technology is applied to the aviation industry, the hotel industry in the management of perishable products such as, which is originated in the late 1970 of the 20th century United States aviation “yield management”. Revenue management is actually a real time pricing, refers to the use of information systems and pricing strategies, at the right price at the right time to sell appropriate products to the appropriate customers, broken down to achieve a fixed capacity and the potential match between the needs of the market, so as to achieve maximum benefits. Overseas experience has proved that application of revenue management in enterprises in the case of costs does not change, higher income 3%~7% profit increased 50%~100%. Currently, the revenue management technology has been widely used for hotels, car rental, TV advertising, road transport, telecommunications and energy supply industries and financial services, retail, manufacturing, Internet services, and sports stadiums and other developments in the field. The Wall Street Journal has put in many industrial applications of revenue management system, hailed as the 21st century the most important and the return on investment one of the top edge of the industry. Study on earnings management in China more and more attention in 2009 Chairman of the National Natural Science Fund Management Department “in services revenue management research (G0m3)” as the only one of the key projects of L5.
Features of this research from the gymnasium staff, exploring the feasibility of stadiums use yield management operation, and an analysis of the appropriate business strategy, finally raised revenue management problems for attention in stadiums.
1 Gymnasium for revenue management features
Yield management is not suitable for any industry, based on practical experience, has the following 6 characteristics of the industry for using revenue management, that is, products with timeliness, providing a relatively limited capacity of the products, categories, products for customer needs can be clearly advance in advance, high fixed cost and low variable cost of products, product requirements, volatile.
1) Stadium site is not stored. Of the stadia venues are not stored, if some day a venue of stadiums is not rented out a time period, then the day value of this site will forever disappear, it is impossible to transfer to a different rental periods, therefore, to maximize rental rates to achieve more revenue for Stadium venues.
2) capacity of the stadium is relatively fixed. In the short term, service capacity of the stadium is limited, to increase the stadiums capacity or number need to invest a lot of money and experience a longer construction period, for stadiums, if all the space is full, subsequent customer cannot be in the stadium activities, and how to sell at the highest price limited venue issues become the stadium operators must consider.
3) Stadium needs subdivision. Customer market of sports stadiums can be broken down according to occupation, income, consumption characteristics, such as price-sensitive customers, such as the time-sensitive customers, service-sensitive customers, therefore, stadiums to increase profitability can be conditionally developed under different types of customer sites for different periods, different service price.
4) Stadium site can book in advance. Stadium site can be sold to them before the customers arrive at stadiums, so you can more accurately predict the future Stadium venue rental rate, and according to the price of sales timely adjustment of future venues venues, achieve maximum stadiums proceeds.
5) stadiums high fixed cost and low variable cost. Fixed cost of building a sports complex is quite high, and amortization of fixed cost to happen in any customer case, so each increased a customer, only increases the cost of changes in venues such as cleaning expenses, electricity and water costs, its variable cost is quite low. Accordingly, changes in the rental price can be fairly large, and venues are rented out for Stadium cost does not increase, therefore, to maximize rental rate.
6) stadiums demand volatility. Stadiums of demand is a derived demand, non-basic needs, thus Stadium needs is vulnerable to various factors, such as macro-economic environment, people and sports-loving, climate, economic income, price effects of, and sports facilities in these factors lead to fluctuations in demand, greatly affects the income of stadiums. Sports stadiums can use historical data to forecast demand and necessary changes in demand. Leisure time, providing low-price venues, attracting customers improve occupancy; peak, increasing rental prices to increase business revenue.
Sports stadiums can be seen from the above analysis is very suitable for the use of revenue management, this is also a gymnasium and gradually use yield management in foreign countries, and achieved greater success of reason.
Application of revenue management in gymnasium 2 strategy
Fundamentals of revenue management through subdivision of the market, on the different needs of customers at different moments of the purpose of quantitative prediction, and then determined by optimization method of dynamic control, maximizes index finally made, and to maintain sustainable growth.
L) classification of customers and demand forecasting. Different customer demands for stadiums are often different. Revenue management is an important function through the scientific method to classify the different customers and concluded that statistical properties of various behavior patterns, and then for each type of customer’s future needs for accurate predictions, including Stadium reservation sooner or later, use the length of time, the actual use and differences and advance reservation and defer to the scene to the scene of probability, and so on. With these accurate forecasts, according to various customer price sensitivity, stadiums can be well controlled resources, and increase profitability.
2) oversubscribed. Stadium venue reservation more than the total amount of effective site the number of sites in order to prevent the customer cancel the booking or should go to is not to, at the stadium although the phenomenon of the booked but unused waste, resulting in a sports stadium income losses. Due to the advance and the actual scene tends to certain differences exist, so the prediction and control of how this difference in order to ensure the actual occupancy rate is one of the stadiums often to resolve problems. Especially the sale of peak and season, a special highlight. Perspective from the entire community sports facility resource use, control of overbooking is a guarantee of the venues under most conditions makes it a minimum of loss of customer service “Pareto optimal”.
3) pricing. Price segmentation is the core of the revenue management also known as “price discrimination” is according to different characteristics and price elasticity of demand of customers perform different prices to their customers. This price segment uses a customer standards, these standards are reasonable and restrictive conditions. Price elasticity of high standards on the one hand those customers enjoy low prices under certain restrictions, on the other hand for those customers willing to pay the full price with low price elasticity. Important role of such standards is: by price barriers to those “willing and able to consume for the kind of customers” and “in order to make prices lower and willing to change their consumption patterns of customers” separate development market potential to the maximum demand, improving economic efficiency.
(1) on day-time demand control the price. Customer demand for stadiums in every day is different, morning, afternoon, noon and night, according to the specific circumstances of the stadiums at the peak rental rental rate is higher when high prices for rent; rental period in low peak, the occupancy rate at low low prices for rent, forcing rental extra customers turn to low peak periods rush lease stadiums site.
(2) holiday demand control the price. Sports facilities in holiday and special event days is often the best opportunity for profit, many sports facilities can achieve a very high occupancy rates in General during this period. But high occupancy rate is not high profit margins. To maximize revenues and profits, also must have a perfect holiday demand forecast and control methods.
(3) dynamic pricing is set. Stadiums of pricing and profitability management regulation is a sports stadium in the most direct lever. Common cost based pricing is simple, but often lack the flexibility of the competition, and may not reflect the dynamic changes of market demands. Based in revenue management of pricing methods, such as pricing, real-time bidding floating pricing, competitive pricing through market segmentation and effective control makes the function of price leverage to maximize.
4) Stadium site optimization control. Accurate demand forecasting, also must have a corresponding price and income control system resources to be flexible and effective use of the stadium, making gains or profit. Adequate for high customer retention of stadium venues as possible, that is, while increasing the rental rate, as far as possible to accommodate high customer, on the other hand, limited by time, service conditions prevent expensive customer overflow.
5) other strategies. (1) sales management groups: Group sales was almost every stadium is some business, and in most cases a certain discount. But how this business, the quantitative analysis and to effectively control the level of discounts, is the very important work of yield management.
(2) combine the benefits of customer value management: as many sports venues by a profit-center management toward customer service-centered management, how to determine the value of each customer and gains control of the corresponding to differentiate is gains a new direction in the management of sports facilities.
3 revenue management problems in the gymnasium
1) institutional restraint. Sports facility system with the deepening of reform in China, after its management system by program management to budget management, and progressive realization of the transition from administrative management to operations management. However, due to the profound impact of the planned economy, coupled with the objective conditions between venues larger differences currently all stadiums used by the operating system vary among the coexistence of multiple system, there are still a number venues lineage of planned economy “full control”, “balance management” management system. Management of sports facilities in these old systems to bring a range of issues: one is the separation of ownership and operating rights cannot be separated, or less, leading to venues lacking self-determining. Second is the relationship between venues and superior sports authorities cannot be straightened out, resulting in unknown powers and responsibilities, functions are not clear, regardless of interest. Third, the market mechanism is dysfunctional, resulting in resource optimization is difficult, weak competition in the market, and management benefits of inefficient management Chao. So, to make the stadium completely separate from the traditional planned system of physical education, reducing administrative interference, complete the transition from Executive-to-enterprise as soon as possible, realizing the right to ownership and management of two separate, making managers be an independent legal personality, compete according to market rules.
2) obstacles to ideological concepts. Sports complex understanding of revenue management for practitioners there are 4 issues: not understanding yield management. Stadium operators do not even have heard of yield management, are not actually test, let alone used; think discount on revenue management is simple. Revenue management complex meaning, but it sometimes looks very simple, so that some sites for Stadium operators misunderstood as simple discounts; think about revenue management and pricing war. Looks revenue management caused a price cut, resulting in a price war, actually price cuts and price increases are the result of changing the relationship between supply and demand, it is hard to understand this relationship and revenue management, and adopt appropriate price change to regulate supply, so it’s not just prices; think revenue management for large stadiums. Revenue management for large sports stadium is only useful to a certain scale, does not apply to small stadiums, but with the popularity of computer systems and networks, as small stadiums can use income management methods to increase income.
3) sports facility management information system did not apply. Because China computer industry of development started more late, and sports venues management information system of application also basic no, and China sports venues management information system main for static data processing, is processing sports venues daily of statistics, and summary, and tab stops, and retrieved and print, basic Affairs, these affairs processing on sports venues gets more high proceeds of requirements, also far enough, China sports venues management information system software currently also cannot became based on network technology of open type software system.
4) no accumulation of historical data. Revenue management is based on historical data, if the lack of sufficiently accurate information, even with the computer system, nor good, excess reservation, site assignment for demand forecasting and real-time pricing. Currently, the stadium management in our country is to experience management, does not focus on the accumulation of data and analysis, many of the stadium’s own historical data incomplete or note on the competitive data collection, collation, analysis.
5) Super sale. Fundamental purpose is to limit overbooking wasted in Stadium venues, at the same time, overbooking or denied must be guaranteed the number of customers as little as possible, stadiums must find a balance between the two, so that the sum of the costs of the two lowest. Also, if the overbooking occurs, the service recovery is also very important.
Application of revenue management in sports stadiums are new concepts, with the increasing popularity of computer systems and networks, and continues to establish and perfect the management information system, enables the development and application of revenue management conditions of maturing. So in the near future, the revenue management that has been shown to give numerous services operate brought economic benefits of good management techniques, believe that it will be public stadiums and gymnasiums in colleges and universities in China to play an active role in the operation and management.