Revenue Management - IELTS Listening Answers & Explanations
From Cambridge IELTS 01 Academic Listening Test 3 · Part 3 · Questions 24–32
Audio
Questions
Questions 24–27 One Choice
Click the correct answer
Questions 28–32 Note Completion
Complete the notes using NO MORE THAN THREE WORDS for each answer
Two reasons for the new approach to pricing are:
28 has been changed and have 29 .
In future people will be able to book airline tickets 30 .
Also being marketed in this way are 31 groups and 32 companies.
Answers & Explanations Summary
| # | Answer | Evidence | Explanation |
|---|---|---|---|
| Q24 | B | you were going to give us a quick run down on a new strategy for pricing which is now being used by many large companies known as “revenue management” before we go on to your actual tutorial paper on Sales Targets |
Excerpt/Transcript Explanation: The transcript shows the tutor asking Mark to first talk briefly about a new way to pick prices (revenue management) before starting his main project about sales goals (Sales Targets). Answer Explanation: The answer means Mark will talk for a short time about the different ways businesses choose the best prices for what they sell. Reason For Correctness: The correct answer is chosen because Mark is asked to start with a 'quick run down' (a brief explanation) of 'revenue management.' The tutor explicitly defines this as a 'new strategy for pricing.' Although Mark's main paper is about 'Sales Targets,' the question asks what he will talk about 'briefly' before that main topic. |
| Q25 | C | even cheaper if you buy a ticket where you can’t get a refund if you have to cancel; in that case the ticket costs about half the price | Excerpt/Transcript Explanation: The transcript shows that if you buy a ticket and cannot get your money back after canceling, the price is much lower—about half the normal cost. Answer Explanation: The answer means that plane tickets are the cheapest when you cannot get your money back if you decide not to go on the trip. Reason For Correctness: The correct answer is based on Susan's description of flight prices. She explains that while staying over a Saturday night makes a ticket cheap, the price is 'even cheaper' (the lowest) when the ticket is non-refundable. Non-refundable means you 'can’t get a refund' if you need to cancel, meaning the airline keeps your money. |
| Q26 | D | M: Well not really when you think about it, that’s just common sense isn't it |
Excerpt/Transcript Explanation: The transcript shows Mark's opinion. He tells Susan that her feeling of unfairness is wrong because he believes the situation is actually logical and easy to understand as a sensible business choice. Answer Explanation: The answer 'reasonable' means that Mark thinks the way companies set prices makes sense and is logical. Reason For Correctness: The correct answer is reasonable because when Susan says that charging different prices for the same flight feels unfair, Mark disagrees. He uses the phrase 'common sense' to describe why the prices change. In English, calling something 'common sense' means you think it is a smart and logical way to behave, which is a synonym for 'reasonable'. |
| Q27 | A | The fact is that the companies are not actually interested in selling you a cheap flight! They’re interested in selling the seats and flying aeroplanes that are full | Excerpt/Transcript Explanation: The transcript explains that the companies do not focus on lower prices for the people. Their main interest is making sure every seat is sold so that the planes fly with no empty spots. Answer Explanation: The answer means that the goal of the airline companies is to make more money. Reason For Correctness: The correct answer is A because the conversation explains a strategy called revenue management. Mark says that airlines do not care about giving people cheap tickets. Instead, they want to make sure they sell every seat so that their planes are always full. By filling the planes and changing prices, the companies can earn the most money possible. |
| Q28 | the law / law | firstly because the law has been changed to allow the companies to do this | Excerpt/Transcript Explanation: The transcript tells us that the first reason for the new pricing method is a change in the rules that now lets companies set and change prices more freely. Answer Explanation: The answer means that the official rules (the law) are now different than they were before. Reason For Correctness: The correct answer is right because Mark explains that companies started using revenue management for two reasons. The first reason he mentions is that the law was adjusted to permit companies to change their prices. Before this change, companies were not allowed to change ticket prices frequently. Law and changed are the important keywords here. |
| Q29 | powerful computer programs / computer programs / powerful computer programmes / computer programmes | and secondly we now have very powerful computer programs to do the calculations and so the prices can be changed at a moment’s notice | Excerpt/Transcript Explanation: The transcript shows Mark explaining that the second reason for the change is that companies use very strong computer software to work out prices instantly. Answer Explanation: The answer means using very strong or fast software on computers. Reason For Correctness: The correct answer is one of the two reasons Mark gives for why companies use this new pricing method. He explains that they now have very big and fast computer systems to do the math and change prices very quickly. The word "reason" in the task matches Mark saying "two basic reasons" in the text. |
| Q30 | from home computer / from home | M: And I understand we have almost reached the stage where these computer programs that the airlines are using will eventually be available to consumers to find the best deals for their travel plans from their home computerS: Heavens! What a thought! So the travel agent could easily become a thing of the past if you could book your airline tickets from home | Excerpt/Transcript Explanation: The transcript shows Mark explaining that computer programs will be available for people to use on their own computers at home to find travel deals. Susan then says that as a result, people will be able to buy (book) their flight tickets from home. Answer Explanation: The answer means that in the future, people will be able to use a computer in their own house to buy flight tickets instead of going to a travel office. Reason For Correctness: The correct answer is 'from home (computer)' because the speakers talk about a future change in how people buy flights. Mark explains that computer software used by airlines will soon be ready for customers to use on a 'home computer'. Susan then realizes that this means people will be able to 'book' their 'tickets from home', potentially making travel agents unnecessary. |
| Q31 | hotel / big hotel | Many of the big hotel groups are doing it now. That’s why the price of a bed in a hotel can also vary so much | Excerpt/Transcript Explanation: The transcript mentions that many large hotel businesses are now using the same system as the airlines. This is why the price of a room in a hotel can change a lot depending on how or when you book it. Answer Explanation: The answer refers to the specific type of business groups that are using the new pricing strategy called revenue management. Reason For Correctness: The correct answer is 'hotel' or 'big hotel' because Mark says 'Many of the big hotel groups are doing it now.' The notes in the task ask for the name of the 'groups' that are using this system. Since the word 'groups' is already written after the blank, 'hotel' or 'big hotel' is the word that completes the sentence correctly based on the talk. Keywords to notice here are 'hotel' and 'groups'. |
| Q32 | hire car | Yes, and hire car companies are also using revenue management to set their tariffs, because they are also dealing with a “commodity” if you like | Excerpt/Transcript Explanation: The transcript explains that companies that rent out cars are also using this new pricing method to decide their prices because they treat their services like physical items. Answer Explanation: The answer 'hire car' refers to businesses that let people pay money to use a vehicle for a short time. Reason For Correctness: The correct answer is 'hire car' because Mark says these companies are also using 'revenue management' to set their 'tariffs,' which means their prices. Since the note asks for a type of 'company,' and the text mentions 'hire car companies,' the words 'hire car' fit perfectly in the blank. In this context, 'hire' is a synonym for 'rent'. |
Transcript
T = Tutor
M = Mark
S = Susan
T: OK, everybody, good morning! It’s Mark’s turn to talk to us today so Mark, I’ll ask you to get straight down to business.
M: Right!
T: Now following on from what we were discussing last week in Susan’s tutorial on approaches to marketing, you were going to give us a quick run down on a new strategy for pricing which is now being used by many large companies known as “revenue management” … before we go on to your actual tutorial paper on Sales Targets. Is that correct?
M: Yeah, OK, well …
T: So what exactly is revenue management?
M: Well, it’s a way of managing your pricing by treating things like airline tickets and hotel rooms rather more as if they were perishable goods.
S: Yeah, I just tried to book a ticket yesterday for Perth and would you believe there are three different prices for the flight?
M: Right! And what was the rationale for that?
S: Well … the travel agent said it depended on when you book and the length of the stay, like it’s cheap if you stay away for a Saturday night, presumably because this isn’t business travel and even cheaper if you buy a ticket where you can’t get a refund if you have to cancel; in that case the ticket costs about half the price. You wouldn’t think it would make that much difference, would you?
M: Well it does, and that’s basically because the airlines are now treating their seats like a commodity. You see — if you want a seat today, then you pay far more for it than if you want it in three weeks’ time.
S: That seems rather unfair.
M: Well … not really … when you think about it, that’s just common sense isn't it?
S: I suppose so.
T: What this actually means is that in the same row of seats on the same flight you could have three people who have all paid a different price for their tickets.
S: And is this just happening in Australia?
M: No, no it’s the same all over the world. Airlines are able to “market” a seat as a perishable product, with different values at different stages of its life.
S: Well like mangoes or apples at the market.
M: Yeah, it’s exactly like that. The fact is that the companies are not actually interested in selling you a cheap flight! They’re interested in selling the seats and flying aeroplanes that are full.
T: Mark why do you think revenue management has come about?
M: Well, as far as I can see there are two basic reasons: firstly because the law has been changed to allow the companies to do this. You see in the past they didn’t have the right to keep changing the prices of the tickets, and secondly we now have very powerful computer programs to do the calculations and so the prices can be changed at a moment’s notice.
S: So you mean ten minutes could be critical when you’re buying a plane ticket?
M: Absolutely!
T: That’s right!
M: And I understand we have almost reached the stage where these computer programs that the airlines are using will eventually be available to consumers to find the best deals for their travel plans from their home computer
S: Heavens! What a thought! So the travel agent could easily become a thing of the past if you could book your airline tickets from home. Are there any other industries using this system, or is it restricted to the airline business?
M: Many of the big hotel groups are doing it now. That’s why the price of a bed in a hotel can also vary so much … depending on when and where you book it
T: It’s all a bit of a gamble really.
M: Yes, and hire car companies are also using revenue management to set their tariffs, because they are also dealing with a “commodity” if you like … so the cost of hiring a car will depend on demand.
T: Well, thank you, Mark, for that overview … that was well researched. Now let’s get on with your main topic for today…