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

 

206,796 thoughts on “Railway Industry in France”

  1. A debt of gratitude is in order for Nice and Informative Post. This article is truly contains parcel more data about This Topic. 꽁머니

  3. Thanks for taking the time to discuss this, I feel strongly about it and love learning more on this topic. If possible, as you gain expertise, would you mind updating your blog with more information? It is extremely helpful for me. 토토사이트 순위

  4. Wow! Such an amazing and helpful post this is. I really really love it. It’s so good and so awesome. I am just amazed. I hope that you continue to do your work like this in the future also oppo a16 price in bangladesh

  6. Thank you so much as you have been willing to share information with us. We will forever admire all you have done here because you have made my work as easy as ABC oppo a54

  7. I recently realized your website the other day and that i happen to be following it’s routinely. You’ve got great deal of tips proper here so i delight in your lifestyle of online site likewise. Preserve acknowledge that there are succeed! KanTime Medicare login

  8. This is a smart blog. I mean it. You have so much knowledge about this issue, and so much passion. You also know how to make people rally behind it, obviously from the responses. askwriting.co.uk

  10. Build a second brain with Taskade, the AI-powered productivity platform for you and your teams. Unleash the full potential with generative workflows, task automation, intelligent notes, mind mapping, and real-time video chat, all in one unified workspace. Get work done faster and smarter! AI-powered Workflow Automation

  12. This is a great item, considering all the data about it, this kind of item that anticipates client enthusiasm for the site, and you will share more … good karma. 신규 꽁머니

  16. Great article with excellent idea!Thank you for such a valuable article. I really appreciate for this great information.. 토토

  19. فولورز عرب افضل موقع شراء اعجابات,متابعين,مشاهدات على الأنستقرام وفيس بوك وتويتر وتيك توك ويوتيوب وجميع مواقع التواصل الأجتماعي 100% امن وسريع! شراء مشتركين يوتيوب

  20. Wow! This could be one of the most useful blogs we have ever come across on thesubject. Actually excellent info! I’m also an expert in this topic so I can understand your effort. infinix hot 6

  21. A decent blog dependably concocts new and energizing data and keeping in mind that understanding I have feel that this blog is truly have each one of those quality that qualify a blog to be a one. infinix smart 5 pro

  23. A decent blog dependably concocts new and energizing data and keeping in mind that understanding I have feel that this blog is truly have each one of those quality that qualify a blog to be a one. how much is samsung s8

  31. I definitely enjoying every little bit of it. It is a great website and nice share. I want to thank you. Good job! You guys do a great blog, and have some great contents. Keep up the good work. quietum plus reviews

  32. vPositive site, where did u come up with the information on this posting?I have read a few of the articles on your website now, and I really like your style. Thanks a million and please keep up the effective work. credit card processing agent

  33. Its such as you read my mind! You appear to understand a lot about this, like you wrote the e-book in it or something. I believe that you simply could do with a few % to force the message house a bit, however other than that, this is wonderful blog. A great read. I’ll certainly be back. Escorts in Lahore

  35. Thank you for sharing a bunch of this quality contents, I have bookmarked your blog. Please also explore advice from my site. I will be back for more quality contents. lottery results

  36. An impressive share, I just now with all this onto a colleague who had previously been doing small analysis within this. And then he the fact is bought me breakfast because I stumbled upon it for him.. smile. So i want to reword that: Thnx for that treat! But yeah Thnkx for spending any time to discuss this, Personally i think strongly about this and adore reading on this topic. If at all possible, as you become expertise, could you mind updating your website to comprehend details? It really is extremely ideal for me. Large thumb up with this writing! Digital Global Times

  37. Aw, this was a really nice post. In thought I would like to place in writing in this way moreover – taking time and actual effort to create a very good article… but what / things I say… I procrastinate alot and also no indicates apparently get something done. Vip Lahore Escorts

  43. Your blog provided us with valuable information to work with. Each & every tips of your post are awesome. Thanks a lot for sharing. Keep blogging.. java burn

  44. hello!! Very interesting discussion glad that I came across such informative post. Keep up the good work friend. Glad to be part of your net community. java burn

  47. Quickly this site could without doubt generally always be dominant relating to every one of web site buyers, since thoughtful stories plus exams. alba slot

  48. I have read all the comments and suggestions posted by the visitors for this article are very fine,We will wait for your next article so only.Thanks! alibaba slot

  50. Youre so cool! I dont suppose Ive read anything such as this before. So nice to get somebody with some original thoughts on this subject. realy we appreciate you starting this up. this fabulous website are some things that is required on the internet, somebody with a little originality. beneficial work for bringing a new challenge on the world wide web! Digital Global Times

Leave a Reply

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