Disney adopts Revenue Management practice – is the Spa industry next?

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In an announcement early this month, the executives at Disney have implemented revenue management pricing to reduce overcrowding in the parks at peak times. Disney will raise and lower One-day tickets at both California and Florida locations with Value (off-Peak), Regular, and Peak ticket prices. Revenue management is not a novel concept in the hospitality industry. First used in the 1960’s by the airline industry, revenue (yield) management uses company data to predict demand and adjust the price of service or good based on supply and consumer demand. Revenue management increased earning especially in non-tangible businesses like hotels, rentals car companies, and now hopefully spas.

The concept of Revenue Management has minimal application in the spa industry outside of the occasional spa month around the country. The earning potential revenue management would create for the spa industry has been studied by spa industry legend Mary Tabacchi of Cornell University and others in the Spa industry. As one of the fastest growing sector according to the Bureau of Labor, Spa Indusry leaders must find creative ways to stay ahead of the competition. In studying the past, Spa Managers and Directors can better plan and price the present and predict the future with the use of Revenue Management.

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