Deregulation is generally regarded as the catalyst for yield management in the airline industry, but this tends to overlook the role of Global Distribution Systems (GDS’s). It is arguable that the fixed pricing paradigm occurs as a result of decentralized consumption. With mass production, pricing became a centralized management activity and customer contact staff focused on customer service exclusively. Electronic commerce, of which the GDS's were the first wave, created an environment where large volumes of sales could be managed without large numbers of customer service staff. They also gave management staff direct access to price at time of consumption and rich data capture for future decision-making.
On January 17, 1985, American Airlines launched Ultimate Super Saver fares in an effort to compete with low cost carrier PEOPLExpress. Donald Burr, the CEO of PeopleExpress, is quoted in the book "Revenue management" by Bob Cross saying "We were a vibrant, profitable company from 1981 to 1985, and then we tipped right over into losing $50 million a month...We had been profitable from the day we started until American came at us with Ultimate Super Savers." The Revenue management systems developed at American Airlines were recognized by the Edelman Prize committee of INFORMS for contributing $1.4 billion in a three year period at the airline.
Revenue management spread to other travel and transportation companies in the early 1990s. Notable was implementation of revenue management at National Car Rental. In 1993, General Motors Corporation was forced to take a $744 million charge against earnings related to its ownership of National Car Rental Systems. In response, National's program expanded the definition of Revenue management to include capacity manageme ...