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

 

166,177 thoughts on “Railway Industry in France”

  9. I in addition to my buddies happened to be digesting the excellent points located on your web site and then all of the sudden I had an awful feeling I never expressed respect to the site owner for them. All the men were absolutely thrilled to read through them and have now in truth been having fun with them. Thank you for actually being indeed kind and then for obtaining this kind of excellent useful guides most people are really desperate to know about. My honest regret for not expressing appreciation to earlier. Packers and Movers Kolkata to Bhubaneswar

  10. I essentially discovered your site page and expected that would state that I have truly respected the experience of looking on the web diary sections. Terms of use

  13. I have to convey my respect for your kindness for all those that require guidance on this one field. Your special commitment to passing the solution up and down has been incredibly functional and has continually empowered most people just like me to achieve their dreams. Your amazing insightful information entails much to me and especially to my peers. Thanks a ton; from all of us. curcumy

  16. CoinCRED, a popular exchange that has already amassed a user base of approximately
    two lakhs, has come up with its pro version, known as CoinCRED Pro digital currency list . CoinCRED’s impressive
    user base in less time and its amazing features are a testament to the trust and confidence
    that users have in this brand, and we expect CoinCRED Pro to attract even more users in the
    coming months.CoinCRED pro promises to be a more advanced and sophisticated trading platform,
    offering a wide range of trading pairs, with listing at low prices when compared with other
    exchanges in the market. With its-user friendly interfaces and advanced trading options,
    CoinCRED Pro is poised to become a leading player in the world of cryptocurrency trading.

  21. Great post! I am actually getting ready to across this information, is very helpful my friend. Also great blog here with all of the valuable information you have. Keep up the good work you are doing here. App terms of use

  23. Articles with informative content like yours are a breath of fresh air. I thoroughly enjoyed every thought you made in your material. I am with you on your original views and unique content. Thank you. boyntech

  24. Directories such given that the Yellow Websites need not list them, so unlisted numbers strength sometimes be alive more harm than financial assistance. boyntech

  26. The most effective means bring in some form of e-book and enjoy this almost from anywhere is during the entire fascinating process involving mp 3 mp3 audio books. The true sound e-book outlets that always one thinks of as rapidly as. App terms of use

  27. Oh my goodness! a tremendous article dude. Thank you Nonetheless I’m experiencing difficulty with ur rss . Don know why Unable to subscribe to it. Is there anybody getting equivalent rss problem? Anybody who is aware of kindly respond. Thnkx quietum plus

  29. I’m going to read this. I’ll be sure to come back. thanks for sharing. and also This article gives the light in which we can observe the reality. this is very nice one and gives indepth information. thanks for this nice article… situs judi bola resmi

  30. Pretty good post. I just stumbled upon your blog and wanted to say that I have really enjoyed reading your blog posts. Any way I’ll be subscribing to your feed and I hope you post again soon. Big thanks for the useful info. Content Marketing for Businesses

  32. Our team of skilled and trustworthy maids is dedicated to delivering unparalleled cleanliness and organization to your home. Experience the freedom of a spotless and relaxing environment without lifting a finger. From routine maintenance to deep cleaning, our comprehensive range of services ensures every nook and cranny is thoroughly attended to. With our meticulous attention to detail and commitment to customer satisfaction, you can trust us to exceed your expectations. Click on this link;
    http://maidservicesislamabad.com

  36. This is such a great resource that you are providing and you give it away for free. I love seeing blog that understand the value of providing a quality resource for free. agen judi bola

  40. Really I enjoy your site with effective and useful information. It is included very nice post with a lot of our resources.thanks for share. i enjoy this post. agen judi bola

  45. This is my first time visit to your blog and I am very interested in the articles that you serve. Provide enough knowledge for me. Thank you for sharing useful and don’t forget, keep sharing useful info: agen judi bola

  47. This particular is usually apparently essential and moreover outstanding truth along with for sure fair-minded and moreover admittedly useful My business is looking to find in advance designed for this specific useful stuffs… UFABET เว็บตรง

  50. This is my first time i visit here. I found so many interesting stuff in your blog especially its discussion. From the tons of comments on your articles, I guess I am not the only one having all the enjoyment here keep up the good work situs judi bola resmi

Leave a Reply

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