Updated November 2022 – As a tour and activity provider, increasing your revenue is one of your main goals and a smart way to maximize your revenue is by placing variable rates for your tours and activities.

For example, if you offer one-hour horseback riding tours throughout the countryside, you should not create a fixed price of $100 per person, per tour. You need to develop a pricing strategy that allows you to take advantage of the influx of customers during the high season, and still keep travelers booking your tours during the traditionally low season. One of the best ways to do this is through yield management.

n this article, we’ll explain what yield management is and how tour operators can create a yield management system that will increase their profit margin in the tourism industry.

What is yield management in tourism?

Yield management pricing is a practice implemented by different sectors of the tourism and travel industry. Sectors such as the airline industry, hotel industry, and even the hospitality industry all use yield management strategies to maintain steady revenue all year round.

Yield management is the process of implementing a variable pricing strategy that anticipates and understands consumer behavior during different time periods. The main goal of yield management is not to increase booking levels, but rather, it’s to maximize your tour and activity business’ revenue by forecasting your supply and demand across multiple key factors.

yield management pricing

For instance, if you’re a tour operator that does skiing tours in the Snowy Mountains of Australia, the time of year with high demand would be during the winter. During this time, the demand for your services will be extremely high. This is an opportunity for you to adjust your prices according to the demand influx to maximize the revenue of your perishable inventory.

In the case of tour and activity providers, the perishable resource is the limited resources and number of tours that are available on a given day.

The difference between yield management and revenue management

Yield management and revenue management are often used simultaneously but actually have very different meanings.

Yield management aims to generate the most revenue possible out of the sessions you have available. Revenue management is a broader strategy that aims to increase revenue across the entire business.

When we talk about yield management, we need to see it from the fact that tour operators have time-limited inventory control every day. And we need to understand that different customers are willing to pay different prices for the same tour.

Ultimately, yield management helps you find the right balance between incoming bookings and setting the ideal pricing. It’s the process of selling the right tour or activity to the right customer at the right time for the right price.

yield management strategy

Why is yield management important for tour operators?

Implementing a yield management strategy allows you to place demand forecasting techniques to increase your bookings. A variable pricing strategy will allow you to have a steady business even during the low season and can help you generate maximum revenue all year round.

For example, by setting a seasonal pricing strategy during the off-peak period, you can offer discounted pricing to interested travelers.

Another strategy you can incorporate into your dynamic pricing is adjusting your prices based on the day of the week, or even the time of the day.

Implementing these strategies could further entice potential customers to book a tour when they otherwise wouldn’t. You can adjust your yield management techniques in order to fit the needs of your business.

How can tour operators implement a yield management strategy

Tour operators, especially small, local business owners, can implement yield management by employing a mark-down as well as a mark-up pricing strategy.

In a markdown pricing strategy, you would offer your products at a discounted rate in order to increase the number of bookings you receive. By offering a discount, you get more customers than you would have if you had not created the promotion and therefore increase your profits.

What is yield management

With a markup pricing strategy, you list your tours at a higher price before offering a significant discount. The customer feels like they are getting a deal, but you are able to earn more profits on each individual tour that you book.

Ultimately, yield management will help you increase revenue by allowing you to book your tours and activities at all times throughout the year, and maximize the profits that you earn. This helps you grow your business, create new tours and activities and continue to generate interest in your local area.

How an online booking system can help you implement a yield management strategy

If you’re interested in setting up a yield management strategy, an online booking software such as Rezdy is capable of assisting you to understand your booking algorithms and metrics.

Rezdy’s software equips you with advanced reporting tools that offer insight into your potential booking rates. This tool is called session utilization and it shows you the percentage of a session’s occupancy and can predict whether it will become fully booked or not.

yield management strategy

This is the ideal tool for assisting tour and activity operators to make informed business decisions as to when they might want to create discounts and offers to drive bookings.

Furthermore, setting up variable prices, discount codes, upgrades, and adding extras can all be done seamlessly through Rezdy’s booking software. Simply set the parameters you want and the system will automatically execute it.

For example, if you want to set different prices for the weekdays and the weekends, you can simply set these parameters into the system and the software will automatically feature your weekday/weekend prices depending on the days.


Implementing yield management into your business processes is a fundamental element if you want to maximize the revenue generated for your business all year round. Yield management systems are how hoteliers manage to increase their occupancy rate and book out their hotel rooms, it’s how airlines are able to offer upgrades at a premium price and fill out airline seats.

Incorporating advanced systems into your yield management strategy will allow you to stay ahead of the game. By using software such as Rezdy that equips your business with booking and channel manager tools, you’re able to streamline your business process all while expanding your distribution channels.

For instance, Rezdy’s online booking system provides you with advanced features to automate the booking process. These features include the likes of real-time availability viewer, automatic communication and updates, and secure integration with various payment gateways. This streamlines your admin duties and simplifies your customer’s booking journey.

Furthermore, Rezdy also offers a channel manager platform that connects your business to thousands of industry resellers. These include major OTAs such as Tripadvisor and GetYourGuide, local travel agents, hotels and accommodations, and even government bodies such as information centers.

Joining Rezdy Channel Manager is as simple as listing your products and setting your commission rates. From there, you can let resellers on the platform promote and sell your services to their customers.

Set your business up for success with a FREE 21-day trial or book a demo to learn more about our products and how they can fit within your business.

If you enjoyed this article then make sure to subscribe to our newsletter, where you’ll receive up-to-date marketing tips, business operation advice, and tour operator tips designed with businesses like yours in mind.