by

Railway Industry in France

TGV 1

1. Industry Overview:

In France, one of the most popular transport modes is train.  SNCF is France’s national railway, providing high speed, overnight and local services in France and beyond into Spain, Switzerland and Italy.

>> http://www.tgv-europe.com/en

Types of Train in France:

01-TGV

02-Lunea

03-Teoz

04-TER

06-Intercites

Railway industry is quite similar to airline industry, as it sells seats for a transport from an origin to a destination. The price depends on journey, class, and date of booking. Thus, railway industry can be placed in Quadrant 2, where its service has variable prices for a predictable duration. This industry also has the appropriate characteristics to apply revenue management strategies. Those characteristics are:

– Inflexible capacity: the number of seats on a train is fixed

– Variable and uncertain demand: the demand is different depending on the time of day, day of week, origin-destination pairs, and purpose of travel

– Perishable inventory: the unoccupied seat cannot be inventoried, and the revenue of that seat is missed

– Low marginal cost and high production cost

– Product can be sold in advance

– Heterogeneous customers with different segments, varying by age, purpose of travel, independent or group, etc.

However, there are some differences that make the revenue management of railway industry is little bit different than that of airline industry.

– More difficult to forecast demand and to have the accurate number of travelers on a service: no check-in procedure, open tickets (rail pass) generally allow passengers to travel on any rail service, walk up tickets are very common (a large number of passengers purchase their tickets on the day from the station)

– Less difficult to deal with overbooking: passengers are often allowed to stand during train journeys hence increasing capacity beyond the number of seats

———

 2. Space

Railway industry defines space implicitly.

Normally, a train has two classes: Economy (2nd Class) and Comfort (1st Class). The seating options and services are different for each class. The price is same for different seating options in a class.

 Economy Class:
01-Class2
 Comfort Class:

01-Class 1

Trains, especially TGV has “TGV bar”, which provides a wide selection of meals and sweet snacks available for purchase. Additionally, the TGV bar offers films on DVD, magazines, games for children, Paris Metro tickets, even USB sticks for purchase. There is also a rolling snack cart that comes to the customers’ seats.

01-TGV Bar

For additional revenue, TGV offers Premium service includes 1st Class seat, meal service, and access to the TGV lounge at the train stations.

Personally, I would charge difference fares for different seating options in each class. A group will want to pay more to have a Club 4 seat. A couple will want the Duo seat or Club 2 seat. And an individual traveler will want a solo seat. As the number of seat are fixed, we can charge for each option, rather than a “first comes first served” policy.

I’m also thinking about a mini-cinema on train, especially overnight train. Normally, the overnight train have load factor less than 80%, so the train can use one car to transform into a mini-cinema with a projector and a screen. When the train is busy, the car will be transformed in normal guest car again.

——

3. Time

Railway industry defines time implicitly.

Although the duration of a journey is determined, the railway industry sells a journey rather than specifically selling time. In addition, there may be issues that cause the increase/decrease in duration of the journey.

However, the railway industry also tries to sell time explicitly with the Rail pass. With Rail pass, customers can have unlimited travel on the national rail network of France for a fixed number of days. The choices are 3, 4, 5, 6, 7, 8 or 9-day pass within a one-month period. Travel days may be used consecutively or non-consecutively.  Thus, the fare becomes rate-per-day, not anymore rate-per-trip.

>> http://www.raileurope.com/rail-tickets-passes/france-pass/index.html

The industry can sell time explicitly by providing Rail pass with weekly or monthly unit. However, I think it will not be effective as it makes the demand forecasting much more complicated.  Half-day unit won’t make sense as a trip is normally more than 3 hours.

——–

4. Price

Tickets can be purchased 60 to 120 days in advance depending on the route.

Ticket discounts are based on advance purchase, availability, and certain restrictions. Everyone is eligible to receive discounted fares by purchasing an Economy or Comfort class ticket in advance. Youth and seniors can enjoy specific discounts as well. Discounted tickets are available for youth (under 26 of age), seniors (age 60 and over) and children (generally ages 4-11) but should be verified with each product.

Price at 1 week before departure
01-Price-1st class-10AM-1wk

Price at 2 weeks before departure

01-Price-1st class-10AM-2wk

Price at 3 weeks before departure

01-Price-1st class-10AM-3wk

Price at 4 weeks before departure

01-Price-1st class-10AM-4wk

Normally, prices are reduced for 1or 2 week-advanced purchase, slightly reduced for 3-week-advanced purchased, and stay same for more-than-4-week-advanced purchase.

The physical rate fences are the classes:
01-Booking-Class

 

The non-physical rate fences are age, season ticket, and loyalty

01-Booking-Rate Fences-1

01-Booking-Rate Fences-2

01-Booking-Rate Fences-3

01-Booking-Rate Fences-4

As the rate fences are now already too sophisticated, I would rather consolidate these fences than create new fences to confuse customers.

 

(-Thao Ly)

——–

References:

http://www.raileurope.com

http://www.tgv-europe.com

http://www.sncf.co.uk/

Amstrong and Messneir, 2010. Railway revenue management: Overview and Methods

Schroeder, Braun, and Schnieder. Revenue management in the railway industry

 

166,047 thoughts on “Railway Industry in France”

  1. This is a great inspiring article.I am pretty much pleased with your good work.You put really very helpful information. Keep it up. Keep blogging. Looking to reading your next post. dig this

  7. I’ve been surfing online more than 3 hours today, yet I never found any interesting article like yours. It is pretty worth enough for me. Personally, if all webmasters and as you did, the web will be a lot more useful than ever before. Best of luck for the next! Please visit my web site Twinrivers.com Best Emergency Vet Kamloops service provider.

  11. Good to become visiting your weblog again, it has been months for me. Nicely this article that i’ve been waited for so long. I will need this post to total my assignment in the college, and it has exact same topic together with your write-up. Thanks, good share. คาสิโนออนไลน์

  13. Hey there, You’ve done an excellent job. I will definitely digg it and personally suggest to my friends. I’m sure they will be benefited from this web site. Best of luck for the next! Please visit my web site GardenMore. Best wholesale car audio distributor service provider.

  15. I’ve been surfing online more than 3 hours today, yet I never found any interesting article like yours. It is pretty worth enough for me. Personally, if all webmasters and as you did, the web will be a lot more useful than ever before. Best of luck for the next! Please visit my web site glennmountain.vet Best Animal Hospital Abbotsford service provider.

  16. Excellent read, I just passed this onto a friend who was doing some research on that. I will learn a lot of new stuff right here! Best of luck for the next! Please visit my web site antistaticesd.co.uk. Best Anti Static Mat service provider.

  17. Some genuinely wonderful information, Glad I discovered this. I must say that you’ve done a superb job with this. And i am glad reading your article. Best of luck for the next! Please visit my web site celebritydetoxtea.com. Best Slim Tummy Tea service provider.

  18. Hey there, You’ve done an excellent job. I will definitely digg it and personally suggest to my friends. I’m sure they will be benefited from this web site. Best of luck for the next! Please visit my web site browsandbeyond.co.nz. Best Cosmetic Tattooing Auckland service provider.

  25. Wonderful blog post. This is absolute magic from you! I have never seen a more wonderful post than this one. You’ve really made my day today with this. I hope you keep this up! Blog comment

  27. I appreciate, cause I found exactly what I was looking for. You’ve done an excellent job. I will learn a lot of new stuff right here! Best of luck for the next! Please visit my web site kamin-ofen-fabrik.de. Best Traditioneller Kamin hersteller service provider.

  28. Hey there, You’ve done an excellent job. I will definitely digg it and personally suggest to my friends. I’m sure they will be benefited from this web site. Best of luck for the next! Please visit my web site GardenMore. Best Hire Part-Time Manpower Singapore service provider.

  29. Excellent read, I just passed this onto a friend who was doing some research on that. I will learn a lot of new stuff right here! Best of luck for the next! Please visit my web site mrfloor.com.au. Best Budget Flooring Melbourne service provider.

  30. Aw, this was a really nice post! I would like to thank you for the efforts you’ve put in writing this site. Best of luck for the next! Please visit my web site apprat.io. Best No Code Web App Builder service provider.

  33. Thanks for a wonderful share. Your article has proved your hard work and experience you have got in this field. Brilliant .i love it reading. Ufabet

  35. Generally I don’t read post on blogs, but I wish to say that this write-up very forced me to try and do so! Your writing style has been surprised me. Thanks, very nice post. Best of luck for the next! Please visit my web site houseguard.com.au. Best Waste Removal Bags service provider.

  36. A good blog always comes-up with new and exciting information and while reading I have feel that this blog is really have all those quality that qualify a blog to be a one. check this out

  37. Thanks for sharing superb informations. I’m impressed by the details that you’ve on this site. It reveals how nicely you understand this subject. Bookmarked this web page, will come back for extra articles.Please visit my web site bedrocksportshawaii.com Best Hawaii sports news service provider.

  40. Thanks for sharing superb informations. I’m impressed by the details that you’ve on this site. It reveals how nicely you understand this subject. Bookmarked this web page, will come back for extra articles.Please visit my web site ctv-valves.com Best absperrschieber  service provider.

  41. تخم نطفه دار داتکام معتبر تربن فروشگاه کشور در زمینه ی فروش و خرید تخم نطفه دار به صورت تضمینی می باشد .

    https://tokhmenotfedar.com/

  42. Thanks for sharing superb informations. I’m impressed by the details that you’ve on this site. It reveals how nicely you understand this subject. Bookmarked this web page, will come back for extra articles.Please visit my web site Jenniferqueen.com Best Best Realtor in Winnipeg service provider.

  45. Really impressed! Everything is very open and very clear clarification of issues. It contains truly facts. Your website is very valuable. Thanks for sharing visit this page

  46.  I was just browsing through the internet looking for some information and came across your blog. I am impressed by the information that you have on this blog. It shows how well you understand this subject. Bookmarked this page, will come back for more. visit this page

Leave a Reply

Your email address will not be published. Required fields are marked *