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

 

214,006 thoughts on “Railway Industry in France”

  10. Manila would have developed in a more rational manner than it did. Many historical buildings would still be standing. Intramuros would still be intact. The original Burham city plan would have been followed and the zoning rules would have been implemented. 안전놀이터

  11. 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 Keyword/

  12. On balance, the public’s reaction may have it right. It’s worrisome that a low-level racist gun-lover can so easily copy information that needs to be secret. 카카오웹툰

  14. “The new policy is expected to spur travel, stimulate more business opportunities and foster greater interest for family reunification efforts,” Foreign Affairs Secretary Enrique Manalo said. 조아툰

  15. The pace of real wage growth last year was “significantly dampened” by inflation. The inflation rate in 2022 was 6.1 per cent, higher than the 2.3 per cent recorded the preceding year. 툰코

  16. “This reflected the efforts by firms to restore wages of some employees who experienced wage cuts during the pandemic years, as well as give higher wage increases to other employees to retain staff amidst competition for workers,” said MOM. 늑대닷컴

  18. “As the Singapore economy continued to grow in 2022, there was a strong increase in the proportion of profitable firms. As a result, more firms were able to raise their employees’ wages in 2022 compared to 2021,” said the ministry. <a href="https://www.조아툰.com/&quot; rel="nofollow"blacktoon

  19. The proportion of profitable establishments rose for the second consecutive year to 83.9 per cent in 2022. The proportion of establishments that gave wage increases increased from 60 per cent in 2021 to 72.2 per cent in 2022. <a href="https://www.조아툰.com/&quot; rel="nofollow"웹툰

  21. I’m captivated by online games that offer a straightforward path to earn real money. I’m presently crafting an article that delves into the surging popularity of online slot games in both Asia and globally. Notably, one of my recent articles is gaining traction, titled 5 Methods to Hit a Slot Jackpot Today.

  22. Our company is known for its exceptional specialization in providing leasing solutions for top-quality office spaces. As a highly reputable organization, we have dedicated ourselves to offering premier leasing options for businesses seeking to establish themselves in prime locations.

    Our extensive experience and expertise in the industry enable us to understand the unique requirements of businesses of all sizes, which places us in a perfect position to deliver the best leasing solutions that meet their needs.
    We pride ourselves on our unmatched customer-centric approach, which has earned us an enviable reputation in the industry. Our team of experienced professionals is readily available to guide our clients through every step of the leasing process, ensuring that they make informed decisions that yield the best results possible.
    Choose Premium Offices today as your preferred leasing partner, and give your business the boost it deserves!
    Premium Offices

  27. Hulu ad blocker is a browser extension that helps block advertisements while streaming content on the platform, it prevents ads from playing during TV shows, movies, and series that allow you to watch your favorite programs and shows without any disruptions.

    Add to Chrome : Huluadblocker

  28. Spotify ad blocker is the ultimate solution that allows you to enjoy your favorite tunes without those disturbing ads interrupting your music streaming experience on Spotify, So it’s time to say goodbye to those annoying ads that break the rhythm of your playlists.

    Add to Chrome : Spotify Ad Blocker

  29. Twitch ad blocker is a helpful tool that stops ads from appearing when you watch live streams on Twitch, it prevents all those annoying ads from showing up in between, So it’s time to install the extension to broadcast live streams in a hassle-free manner.

    Add to Chrome : Twitch Ad Blocker

  30. Experience live casino gaming on-the-go by downloading a reputable live casino app. Leading platforms like Betway, LeoVegas, and Royal Panda offer immersive real-time gameplay. Simply visit your app store, such as Google Play for Android or the Apple App Store for iOS, search for the desired app, and hit ‘Download’. These apps bring the thrill of live dealers straight to your device with games like blackjack and roulette. Ensure a stable internet connection, launch the app, create an account, and enjoy an authentic casino experience from the comfort of your mobile device. It’s that easy to indulge in Live Casino App Download anytime, anywhere.

  36. I would like to thank you for the efforts you have made in writing this article. I am hoping the same best work from you in the future as well. Thanks… pets

  40. India has one of the highest household savings rates in the world; the Indian stock market is still in its. Here is the List of Top 10 Mobile Trading Apps in India. You must check out infancy fundamentals about the app and invest with the Best Trading App in India

Leave a Reply

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