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

 

202,657 thoughts on “Railway Industry in France”

  7. Nice to see you again. You’re still running a good site. I’m very envious of that passion. I should learn passion from him. I learn a lot. I look forward to visiting again.안전놀이터

  9. I have been having issues with finding the best  lollipop for myself. After reading this article, my issues has come to an end. I really love the information you provided here as it has helped me a lot. merely looking at the article, i can see that it is written by a PRO. please check my article on
    바카라

  10. Really a great addition. I have read this marvelous post. Thanks for sharing information about it. I really like that. Thanks so lot for your convene. hill house

  11. A very awesome blog post. We are really grateful for your blog post. You will find a lot of approaches after visiting your post.

  12. Such an enlightening website. An obligation of appreciation is all together for sharing. Furniture is a thing that we in general need in our home or workplace. In case you thinking about obtaining new goods, by then I propose you buy victorian decorations. Since it’s altogether pleasing and the arrangement is so impeccable. time news hunt

  13. Extremely helpful post. This is my first time i visit here. I discovered such a large number of intriguing stuff in your blog particularly its exchange. Truly its extraordinary article. Keep it up.
    Journalistic freedom in India

  14. I know your aptitude on this. I should say we ought to have an online discourse on this. Composing just remarks will close the talk straight away! What’s more, will confine the advantages from this data. 
    Journalistic freedom in India

  18. You are a very persuasive writer. I can see this in your article. You have a way of writing compelling information that sparks much interest. LEANBIOME

  19. 인터넷을 검색하다가 몇 가지 정보를 찾고 있던 중 귀하의 블로그를 발견했습니다. 이 블로그에있는 정보에 깊은 인상을 받았습니다. 이 주제를 얼마나 잘 이해하고 있는지 보여줍니다. 이 페이지를 북마크에 추가했습니다. 먹튀검증

  20. Everyone pointed out to you that it’s not true, but it’s amazing that you really didn’t change your beliefs and walked your way and created a beautiful work like this메이저사이트

  21. Experience the ultimate pleasure with Pune Escorts Service. Our high-class escorts are professional, discreet, and cater to all your needs. With a wide range of stunning beauties to choose from, we ensure you have an unforgettable experience. Book now and indulge in the luxury you deserve.
    https://www.nehatondon.in

  24. متعلقات تونلی فرم
    قالب بتن تونلی فرم
    متعلقات تونلی فرم ساختمان
    متعلقات قالب بتنی تونلی فرم
    قیمت متعلقات تونلب فرم
    انواع متعلقات تونلی فرم
    Hyperlink

  28. Thanks for sharing this information. I really like your blog post very much. You have really shared a informative and interesting blog post with people.
    newesttrendy

  35. Somebody essentially help to make significantly articles I would state. This is the first time I frequented your web page and so far? I amazed with the analysis you made to create this actual publish amazing. Magnificent process!
    온라인카지노

  38. کانال سازی
    کانال کشی هوا
    کانال سازی کولر
    کانال سازی صنعتی
    کانال سازی ساختمان
    قیمت کانال سازی
    Hyperlink

  46. Keep up the good work; I read few posts on this website, including I consider that your blog is fascinating and has sets of the fantastic piece of information. Thanks for your valuable efforts. flat fee mls illinois

  47. I am not sure if you mean that you want to write a weblog but don’t want the templates that come supplied with places like Doodlekit… or if you mean you would like to use the content material from another blog – not written by you – in your web site. wettanbieter ohne oasis

  50. هود صنعتی آشپزخانه
    نصب هود صنعتی آشپزخانه
    قیمت هود صنعتی آشپزخانه
    انواع هود صنعتی آشپزخانه
    Hyperlink

Leave a Reply

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