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Simulating the impact of pricing decisions
The pricing world is extremely volatile. For airlines, it becomes more and more important to be able to adjust their prices quickly and flexibly, as demanded by market conditions.
With ProfitLine, Lufthansa Systems has been offering the leading software solution for revenue management and pricing in terms of method and technology for years.

By developing the new module "Pricing Simulation Model" (PSM), Lufthansa Systems now offers an approach that supports the pricing decision making process by simulating the impact of pricing actions for a certain fare with respect to changes in passenger demand and revenue achieved. This way, business experts are able to precisely assess the quality of a planned pricing action. In addition, the module's optional integration into a revenue management system enables the forecasting component process to consider the impact of own and competitive price changes on the booking behaviour. The input for the Pricing Simulation Model is a number of imaginary - perhaps prospective - tariff changes, forming a so-called "scenario".

This way, the Pricing Simulation Model allows simulating the impact of pricing decisions on passenger demand and revenue prior to putting them into action and furthermore a re-forecasting due to price changes within the revenue management process. The model forecasts the pure passenger behavior (real willingness to pay) and the behavior of the passengers within the impact of the revenue management (highest willingness to pay) by considering competitor reactions, cannibalization effects, customer migration and market stimulation effects. This accelerates the calculation of fare prices, thereby lowering response time to competitor price actions, and increases revenues by adjusting prices far more precisely than possible before.

The components of the Pricing Simulation Model support the features in Lufthansa Systems' project "Dynamic Pricing". This integrated approach to revenue management and pricing is unique to the industry and provides a fast and very flexible way of calculating the price of an air trip individually for each request by including parameters like specific customer needs, demand/supply situation at the airline and current competitor prices.


Route Planning in the Air
The flight to North America takes off in four hours. Your suitcase is packed. You check your handbag one last time and then jump in a cab to the airport. At the same time, the dispatchers starts calculating the route for your flight. Will it be able to take the shorter route today? Every single flight must be planned meticulously so that the flight can arrive on schedule, the skies can be kept safe, and fuel can be used both economically and ecologically.

Navigation from the departure to the destination airport is a central process which makes flight execution possible. Lido OC covers all aspects of flight planning and relevant follow-up procedures and has set a new benchmark for flight preparation and operations. It draws on its own database, which allows it to automatically calculate the ideal flight path between two airports and to generate secure and easy-to-understand briefing documents for each flight.

Martinair has been using Lido OC from Lufthansa Systems since 1997. The Dutch airline was impressed by the functionality of Lido OC and has just extended its contract for the use of Lido OC for another five years. Other airlines using Lido OC are Lufthansa, Singapore Airlines, Air Canada, British Airways and the Latin American airline TACA. Qantas also opted for the powerful solution in August 2005.

The automatic calculation of routes based on the criteria of time, cost or distance takes into account flight-related information such as weather data and all current aeronautical restrictions like NOTAMs. Lido OC offers comprehensive customer service with the Lido Helpdesk, which is available 24/7 to provide support for technical and practical questions.