2 How does it all work?

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Market Segment Identification

The first and foremost step in a hotel RM system is the identification of the various market segments for the hotel room, followed by implementation of a differential pricing scheme.

The objective in front of the hotel is the expansion of its market and in motivating the customer to pay more than he/she will usually spend. It is further observed that customers in the business class segment are less sensitive to higher prices as opposed to those in the vacation segment.

An RM system helps hotels create additional price-points by building physical and logical fences around the different market segments, as shown in the table below:


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