Optimization of travel subscription use

Abstract

Subscription models where consumers pay fixed (monthly) fees for access to services are becoming increasingly popular across a wider set of service offerings as firms look for ways to stabilize revenues. Lodging subscription services are natural and flexible extensions of timeshare models whereby consumers pay monthly subscriptions fees to get access to a wide variety of stay options. The value of the subscription service may be difficult for consumers to evaluate and hence limit adoption. This study demonstrates that service providers can assist consumers in maximizing use of their subscription through addition of simple sort functionality or via more robust optimization approaches. Using synthetic data as well as data from a lodging subscription provider, we develop approaches for consumers to maximize their use of the subscription service - we compare and contrast optimal approaches to readily deployed heuristic approaches.