Abstract
Higher education is influenced by social, cultural, economic and academic drivers (Knight, 2004). According to Marginson (2003) education is moving in the direction of marketization and is also becoming more profit-driven. Researching for-profit higher education, Fried and Hill (2009:37) state that “higher education is different from most goods in several ways”. Nonetheless, for-profit higher education has to maintain its profitability to stay not only in a very competitive market but one in which external factors have a huge impact. One way to react to the changing landscape could be the application of revenue management principles to for-profit higher education. Revenue Management is nowadays of growing importance across several industries which face capacity constraints and fluctuations in demand. Hence, the purpose of this thesis is to examine how revenue management can be applied in for-profit higher education. Based on a realism research paradigm, the author has conducted a single case study design with embedded units, by interviewing 19 members of management in a leading for-profit hospitality school which offers higher education programs. The aim of the research was two-fold; first, to analyse the specifics of for-profit higher education, and second, to investigate what implications this has for the management of pricing and capacity. This has led to the following findings: - Although revenue management is applied nowadays in many industries it is necessary in order to fully understand the practice, to classify the type and application of revenue management practice in terms of preconditions and components and tools of revenue management utilised, - For-profit higher education looks like a suitable candidate for revenue management practice, however only a 'loose' revenue management model can be applied, mainly based on the use of scholarships and optimised capacity utilisation, - There are different viewpoints on the product and nature of education, which has implications for the management of pricing and capacity such as for example avoidance of overuse of capacity. The thesis contributes to theory, as research was undertaken regarding an application of revenue management in a new industry setting. Moreover, the author argues that a contribution has been achieved by developing a new typology of revenue management, based on several components identified, which assists in classifying revenue management applications in different industries.