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Pricing and Revenue Management of Services: A Strategic Approach by Irene C.L. Ng. Published by Routledge, PRINT ISBN10: 0-415-35077-8 (Hardbook), ISBN10: 0-203-69659-X (e-book) 197 pages (2008)

Our book browse continues the trend of discussing business books that cover the theme of pricing. As industrial and systems engineers, we are concerned with operational efficiency, but we must also be concerned about operational and organisational profitability. Not all industrial and systems engineers work in production facilities, where many writers and researchers of pricing and revenue management have focused their interests in the past years. Ng's book on pricing and revenue management is very much centered on the services industry. The 197-page book covers the topic from both a microeconomics (individual buyer) and a macroeconomics (buyers in aggregate) perspective.

In the first three chapters (after the introduction), the reader gets an understanding of the expected consumer value framework. This framework helps to corral one's thoughts how purchasing decisions are done by consumers and how the service firm can target various consumers in different segments. The examples used are mainly business to consumer (B2C) services interactions instead of the business to business (B2B) services interactions. Therefore, if you are in the B2B sphere, you will have to do more reading or some adoption of the strategies outlined in these chapters. Ng goes on to provide strategies on how to optimize for revenue with the company's pricing strategies.

The second half incorporates economics principles to examine the supply and demand curves of the service industry. Supply and demand curves help to determine the prices that companies can charge. The chapter explains how to implement revenue management with demand management. The service industry has to deal with capacity perishability – i.e., when the day is over, any unused service capacity has been wasted. Ng also provides four additional strategies that incorporate demand management as part of revenue management (optimization) strategies for companies to follow.

The book has an easy to follow approach suitable both for practitioners and academics. It provides practical solutions with examples and is supported by research. It is a good book to have in your physical or electronic book shelf. Pricing and Revenue Management of Services: A Strategic Approach is definitely a recommended read for the pricing professional and revenue managers in addition to industrial and systems engineers who are interested services profitability.

If you have any other books that can be reviewed, contact Newsletter Editor Daren Maynard.