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

 

166,356 thoughts on “Railway Industry in France”

  1. You have done a great job on this article. It’s very readable and highly intelligent. You have even managed to make it understandable and easy to read. You have some real writing talent. Thank you.  video porn

  5. Los doramas kdramas, Cdramas, tailandeses y Jdramas, entre otros, se pueden ver en línea con subtitulos en DoramaFlix. Doramas y películas completas en español, subtituladas y latino en alta calidad en línea.

  8. Delta 8 cannabis, your trusted provider of premium Delta 8 THC products for medical cannabis patients in the USA. Our mission is to provide safe and legal access to high-quality Delta 8 THC products that can help improve the lives of people with various health conditions.

    Check out more Purchase Alien mints starin

  9. I was surfing net and fortunately came across this site and found very interesting stuff here. Its really fun to read. I enjoyed a lot. Thanks for sharing this wonderful information. virgin

  14. I am continually amazed by the amount of information available on this subject. What you presented was well researched and well worded in order to get your stand on this across to all your readers. sex online

  17. Just admiring your work and wondering how you managed this blog so well. It’s so remarkable that I can’t afford to not go through this valuable information whenever I surf the internet!  Pigeon Forge Magic Shows

  23. I’ve been surfing online more than three hours today, yet I never found any interesting article like yours. It’s pretty worth enough for me. In my opinion, if all webmasters and bloggers made good content as you did, the web will be a lot more useful than ever before. bubbl.us

  25. The article you have shared here very awesome. I really like and appreciated your work. I read deeply your article, the points you have mentioned in this article are useful sex online

  31. NatashaRoy providing Best Hyderabad Escort Services. We have beautiful and sexy Hyderabad Escorts for you. You can get best escort services in Hyderabad from us. Book an appointment and enjoy with our escorts. We will provide you 24*7.

  37. 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
    world largest religion

  42. It was a very good post indeed. I thoroughly enjoyed reading it in my lunch time. Will surely come and visit this blog more often. Thanks for sharing. 英文補習

  46. I feel extremely cheerful to have seen your site page and anticipate such a large number of all the more engaging circumstances perusing here. Much appreciated yet again for every one of the points of interest. I need you to thank for your season of this great read!!! I definately appreciate each and every piece of it and I have you bookmarked to look at new stuff of your blog an unquestionable requirement read blog! Sustain the great do the job, When i understand several threads within this web page in addition to I’m sure that a world-wide-web blog site is usually authentic useful possesses bought bags connected with excellent facts. 토토

  48. I love significantly your own post! I look at all post is great. I discovered your personal content using bing search. Discover my webpage is a great one as you.I work to create several content this post. Once more you can thank you and keep it create! Enjoy!
    world largest religion

  49. pastikan Anda telah memilih Agen Slot terpercaya dan terbaik untuk Anda mainkan. Selanjutnya, perhatikan batasan taruhan Anda dan pastikan Anda memasang taruhan dengan bijak. Anda juga perlu menguasai permainan slot yang Anda mainkan dan memahami karakteristik setiap game serta peluang kemenangan yang diberikan.

Leave a Reply

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