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

 

166,140 thoughts on “Railway Industry in France”

  2. 나는 훌륭한 유용한 리소스를 무료로 제공하는 비용을 이해하는 웹 사이트를 보는 것을 좋아합니다. 나는 당신의 게시물을 읽는 것을 정말 좋아했습니다. 감사합니다! 토토사이트

  3. Acknowledges suitable for penmanship an incredibly precious column, As i occured adjacent to your web site in addition to approximate several assistance. I had desire people build in touch with manuscript… cat brush

  30. Wow, I love how your site keeps me updated on the latest entertainment trends! If you’re a fan of streaming apps like HBO Max, you’ll definitely want to check out my site Hbo Max APk for the best tips and tricks to enhance your streaming experience. Keep up the great work!”
    Remember to customize your comment to fit the context of the blog or website where you’re leaving the comment, and always ensure that your comment is relevant and adds value to the discussion.

  31. I am royj18 working for thewebscience . PR consultant. With more than 6 years experience in PR and Digital Industry, helping teams to achieve goals by streamilining the process.

  32. Thanks for sharing nice information with us. i like your post and all you share with us is uptodate and quite informative, i would like to bookmark the page so i can come here again to read you, as you have done a wonderful job momobet

  34. I recently came across your article and have been reading along. I want to express my admiration of your writing skill and ability to make readers read from the beginning to the end. I would like to read newer posts and to share my thoughts with you. Make Money online

  35. เรื่องราวของ เอมิ ฟุกาดะพี่สาวของเพื่อนบ้านที่ “จืด” ไอ้หนุ่มโตเกียว แวะมาเยี่ยมหาเพื่อนวัยเด็กอากาศที่บ้านนอกร้อนมาก จืดได้แต่มองเหงื่อเธอไหลลงร่องอก ภาพติดตากลับบ้านแถมลืมสายชาร์จ จนต้องกลับมาเผด็จศึก

    สามารถติดตามหนังAVซัพไทย หนังAVญี่ปุ่น หนังAVเเนวลักหลับ AVเเนวครบครัว
    ได้ที่นี่ที่เดียว https://av-ogc66.com/

  44. 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! HYIP forum

  46. Hmm… As i fully grasp websites having a linked problem, all the same as i do not ended pictures web page. As i added in from the piece that can help populars moreover i’ll quite possibly possibly be people specific primer. cat clothes

Leave a Reply

Your email address will not be published.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