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

 

177,590 thoughts on “Railway Industry in France”

  2. Many thanks for your informative posting. What else could I possibly find that kind of information put in such a flawless way? I have been looking for such information for a project that I am now working on. women’s activewear

  6. It truly is major, however it can be significant to assist you to top of the head towards web page the product weblink: acim

  7. It truly is major, however it can be significant to assist you to top of the head towards web page the product weblink: acim
    v

  8. This is a great high resolution screen which you have shared for the users. Making a website is not an easy task but managing a good website is really a hard work. As far as this website is concerned, I am very happy. dinner Seminyak place

  9. Considerably, the article is really the greatest on this worthw hile topic. I concur with your conclusions and also definitely will eagerly look forward to your approaching updates. Saying thanks will certainly not simply just be sufficient, for the exceptional clarity in your writing. I can at once grab your rss feed to stay informed of any kind of updates. Genuine work and much success in your business dealings! ufabet บน มือ ถือ

  11. Such a very useful article. Very interesting to read this article. I would like to thank you for the efforts you had made for writing this awesome article. 툰코

  12. We provide expert assistance for seamless Linksys Velop AX4200 Setup . Our team ensures a hassle-free installation and configuration process, guaranteeing you a robust and reliable home Wi-Fi network. Say goodbye to connectivity issues with our dedicated support.

  13. I really loved reading your blog. It was very well authored and easy to undertand. Unlike additional blogs I have read which are really not tht good. I also found your posts very interesting. In fact after reading. I had to go show it to my friend and he ejoyed it as well! private event seminyak

  16. Learn the ropes of how to deposit fiat and crypto on kraken. Whether you’re a crypto enthusiast or just starting out, our guidance can assist you in navigating the process with ease. Our comprehensive resources provide step-by-step instructions and expert tips to help you seamlessly fund your Kraken account, making it a hassle-free experience.

  28. Do you want the best GFE experience call girl service in Karachi at no cost? Call us now to set up a date with your dream call girls in karachi pakistan. There are many girls who are ready to fulfill your wildest dreams. We are here for you 24 hours a day, seven days a week.

  33. Temperature Regulation: Skin helps regulate body temperature by controlling perspiration and blood flow.Detoxification: The skin aids in the removal of waste products and toxins from the body through sweat.Emotional and Psychological Well-being: Healthy skin can boost self-esteem, confidence, and emotional well-being. Skin problems can sometimes lead to psychological distress. my website

  34. A fascinating dialog is value remark. I feel that it is best to compose more on this matter, it may not be an unthinkable theme however generally people are insufficient to chat on such subjects. To the following. Salud. dinner Seminyak place

  39. You have made some decent points there. I looked on the internet for more information about the issue and found most people will go along with your views on this web site 토토사이트

  47. Here, talking with an acclaimed NetSuite Solution Provider can get you to handle your business issues and help you with picking the most fitting software solution as per your business purposes, and plans, and wherever required tweak and design the framework too. You can connect to an avowed NetSuite Partner offering off-shore business service expecting that you are fighting with various or disparate systems.

  48. Katie Sakov‘s achievements have not gone unnoticed. She has received numerous awards and recognitions for her outstanding contributions in [specific industry or field]. These accolades serve as a testament to her dedication and excellence.

Leave a Reply

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