Air Cargo Industry Leaders Continue Commitment to Pricing & Revenue Management Optimization Despite Today’s Economic Challe...
18 August 2009 - 10:00PM
Business Wire
With airlines under increasing pressure to boost revenue in all
business sectors, revenue management in the air cargo industry is
gaining ground as a best practice applied by Delta,
Continental Airlines and other leading air carriers.
Recently, representatives of these and other companies attended the
Cargo User Conference hosted by JDA®
Software Group, Inc. (NASDAQ: JDAS) in Atlanta. During the
conference, attendees discussed the importance of business process
analysis, and learned how JDA’s next-generation price optimization
technology can help drive profits in times of excess capacity, as
well as assessed the impact from toughening regulatory
requirements.
A major air cargo provider presented an overview of its recent
revenue management project implementation that emphasized the
importance of balancing the synergies of people, processes and
technology with a company’s overall IT strategy and revenue
management goals. Conference attendees benefited from an in-depth
discussion of how to use business process modeling that encompasses
revenue management and its impact on sales, accounting, operational
policies and client dynamics.
“The record attendance at our conference and the lineup of
industry leaders who spoke about the issues illustrates the growing
focus on revenue management strategies,” said Andy Archer, group
vice president, service industries, JDA Software. “Even with
reduced demand and capacity, air cargo companies are focused on
pricing and revenue management solutions, and are working with JDA
to continue improvement in this critical area. The conference gave
us an opportunity to offer our vision for future product
development and to gather ideas for ongoing improvement.”
Revenue Management Experts Provide Perspective,
Guidance
Speakers at the Cargo User Conference consisted of noted
authorities who have pioneered pricing and revenue management
approaches for air cargo, including the following:
- Raja Kasilingam, chief
executive officer of CargoINTEL, discussed the impact of
tighter U.S. Department of Homeland Security regulations on cargo
security inspection mandates and the added costs those regulations
will bring. He also acknowledged that many companies are looking at
pricing and revenue management technology to uncover opportunities
to increase revenues during the economic downturn, and that JDA is
in a key position to address the emerging realities facing the air
cargo industry.
- Dr. Pelin Pekgun-Cakmak,
a noted researcher and architect of pricing solutions across
multiple industries in collaboration with JDA, presented the
results of her research on innovative methods to determine price
elasticity in travel-related industries. She remarked that due to
unique characteristics present within the travel industry, standard
pricing theories and practices would lead to incorrect assumptions
concerning consumer behavior and the impact of price changes on
demand.
- Jason Cameron, general
manager of business planning and analysis, Delta Air Cargo, led
a session on key performance indicators and ideal reporting
strategies for the air cargo sector. Cameron discussed the
challenges of accurate and insightful reporting, and emphasized
that each analysis must be tailored to individual consumers’ needs
– whether they are in operations or corporate strategy
positions.
- JDA’s Suresh Acharya, vice
president, analytical services, and Fion Choi, operations
research consultant, highlighted that while revenue management
techniques work well when carriers are capacity constrained, there
are additional revenue opportunities available when excess capacity
exists by applying price optimization techniques. Results from a
working prototype of JDA’s Travel Price Optimizer™ were then
presented to session attendees. The exercise illustrated a 3
percent revenue improvement during challenging economic times when
demand is less than the available capacity.
Elevating Air Cargo Revenue Management from Manual
Processes
A common theme at the Cargo User Conference was how JDA is
prompting more carriers to see that manual measures are
insufficient to meet the increased revenue targets of today’s
aviation industry. The JDA solution elevates air cargo revenue
management from the traditional manual process focused on
controlling availability and yielding less-profitable ship dates,
to a fully automated approach that optimizes pricing. The solution
then recommends the best price for all dates, forecasting rates
based on price sensitive revenue management data, and factoring in
all of the variables that make up air cargo revenue management such
as demand, volume and competitive rates.
Commenting on the success of the conference, David King,
senior manager of cargo revenue management, Continental
Airlines, said, “JDA continues to grow the quality and scope of
its solution offerings to the Air Cargo market. We look forward to
identifying additional revenue opportunities on top of the proven
results the JDA solutions have already delivered.”
At the conference, JDA’s User Group weighed in on the Company’s
product roadmap for the coming year, and how new updates and
releases will be managed for JDA’s Price Sensitive Revenue
Management solution suite.
About JDA Software Services Industries Group
JDA Services Industries Group helps companies in the Travel,
Transportation, Hospitality and Media industries balance supply and
demand through innovative forecasting, pricing and revenue
management solutions. The result is a dramatic increase in revenue,
margin and efficiency. JDA clients include Carlson Worldwide,
Continental Airlines & Cargo, Harrah’s Entertainment, Omni
Hotels, Princess Cruise Lines, Eurostar and TUI Travel (formerly
Thomson Holidays).
About JDA Software Group, Inc.
JDA® Software Group, Inc.
(NASDAQ: JDAS) is the world’s leading supply chain solutions
provider, helping companies optimize operations and improve
profitability. JDA drives business efficiency for its global
customer base of more than 5,800 retailers, manufacturers,
wholesaler-distributors and services industries companies through
deep domain expertise and innovative solutions. JDA's combination
of unmatched services, together with its integrated yet modular
solutions for merchandising, supply chain planning and execution
and revenue management, leverage the strong heritage and knowledge
capital of market leaders including Manugistics, E3, Intactix and
Arthur. When supply chain results matter, companies turn to JDA.
For more information about JDA, visit www.jda.com or contact us at
info@jda.com or call +1.800.479.7382 / +1.480.308.3000.
We do not believe this press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Nevertheless, if remarks in this press release
are considered to be “forward-looking” or to have forward-looking
implications (including statements by Andy Archer, Raja Kasilingam,
Dr. Pelin Pekgun-Cakmak, Jason Cameron, Suresh Acharya, Fion Choi,
David King and by JDA regarding anticipated benefits from the
implementation of JDA’s products), we would remind our investors
and prospective investors that future events may involve risks and
uncertainties. These risks and uncertainties include the risk that
complex software solutions such as JDA’s may be costly and
time-consuming to implement and/or may not produce the level of
benefits anticipated by the parties at the outset of the project.
Other risks and uncertainties that may affect our business are
detailed from time to time in the “Risks Factors” section of our
filings with the Securities and Exchange Commission. As a result of
these and other risks, actual results may differ materially from
those predicted. We undertake no obligation to update information
in this release.
“JDA,” “Price Sensitive Revenue Management solution suite” and
“Travel Price Optimizer™” are trademarks or registered trademarks
of JDA Software Group, Inc. Any trade, product or service name
referenced in this document using the name “JDA” is a trademark
and/or property of JDA Software Group, Inc.
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