The encyclopedia · Sales & Retail · Financial decision · 2017–2021
Carnival's YODA prices 65 cruise ships and lifts net ticket revenue 1.5–2.5%.
A quadratic-programming revenue system jointly sets cruise prices and cabin inventory, gaining 1.5–2.5% net ticket revenue in A/B tests.
Carnival Corporation & plc
the move
Carnival found airline and hotel revenue management systems incompatible with cruises, where one ship sells multiple cruise lengths from the same inventory at once.
With Revenue Analytics it built YODA, which uses quadratic programming to set prices and allocate cabins jointly across a ship's offerings, with machine-learned demand forecasts and a cruise-specific elasticity model.
Since December 2017 YODA has priced voyages on 65 Carnival ships, about a quarter of the world's cruise fleet; A/B tests showed 1.5–2.5 percent incremental net ticket revenue. The work was a 2020 Edelman finalist.
why it works
- Joint optimization captures substitution between cruise lengths on the same ship.
- A cruise-shaped elasticity model beats airline formulas that don't transfer.
- Millions of daily price recommendations scale across brands and currencies.
what transfers
If off-the-shelf pricing systems don't fit your product, model the joint price-and-inventory decision for your own unit structure — the uplift compounds across the fleet.
what came after
YODA expanded across Carnival brands and became the pricing backbone for its fleet; the Edelman citation and the Interfaces paper are standard references in cruise revenue management.
references
- 2020 INFORMS Franz Edelman Award Selects Finalists (via Internet Archive)
- Carnival Optimizes Revenue and Inventory Across Heterogenous Cruise Line Brands (INFORMS Journal on Applied Analytics 51(1), 2021)
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