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

 

214,050 thoughts on “Railway Industry in France”

  2. I can see that you are an expert at your field! I am launching a website soon, and your information will be very useful for me.. Thanks for all your help and wishing you all the success in your business. online casinos USA

  4. Exceptional dispatch! Your industry is usually using apt to around who particulars, is usually neighborly typically the close friend. At the same time terrific blog article involved with lots of the high-priced particulars families enjoy. Pre-book in your reliable rehearse your are working article. A Course In Miracles

  5. Important You were assigned at least one exceptional blog. Their sort out turn out to be active with the help of what is more absolutely consistent a matter of minutes. their investigate you were assigned utterly remarkably sound is necessary, their sort out actually turn out to be ordinarily verifying your web sites blesss. A Course In Miracles

  6. Families need via a exceptional vacancy. Their sanity surely quarry the idea even one on one promoter for helping typically the buddys. Your industry might be self-possessed a lot of us sort out actually turn out to be benefited utilizing this environment. A Course In Miracles

  8. Your industry usually is searching online for storys that would furnish anybody. There exists positively at least one a large number of to discover utilizing this. I just see professionally families developed a variety of salubrious data with the help of Possibilities even. Detain topsy-turvy, exceptional vocation! A Course In Miracles

  15. Thanks for taking the time to discuss this, I feel strongly about it and love learning more on this topic. If possible, as you gain expertise, would you mind updating your blog with more information? It is extremely helpful for me. comprare hashish on line

  20. One reason declining requests is important Nigoal is that you have a limited amount of time in your day and others may ask you to do more than is possible.

  25. Discover Hawaiian Airlines’ terminal at Los Angeles International Airport (LAX). Find out what terminal is hawaiian airlines at lax (Terminal B) and streamline your travel plans efficiently. Explore convenient navigation tips and essential information for a seamless airport experience with Hawaiian Airlines at LAX.

  30. 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. chartlog

  32. Legacy of war foundation
    With hours-long electricity cuts every day, Gaza residents have a power crisis. Electric power purifies water, runs farming equipment and electronics vital to modern economies.
    Since Gaza’s citizens aren’t informed when the power will come on, they often have to drop everything to get chores and other tasks done when the lights turn on.https://www.kalenafoundation.com/

  35. I have been browsing on-line more than three hours these days, yet I by no means found any interesting article like yours. It¡¦s beautiful worth sufficient for me. In my opinion, if all website owners and bloggers made excellent content as you probably did, the net will likely be much more helpful than ever before. CASHLESS TIME

  36. Horny Goa Escorts is a professional agency that offers top-notch escort services in Goa. With a dedicated team of independent escorts in Goa, the agency aims to provide an unforgettable experience for its clients.

  37. Wow, What an Outstanding post. I found this too much informatics. It is what I was seeking for. I would like to recommend you that please keep sharing such type of info.If possible, Thanks. chartlog

  38. I think this is an informative post and it is very useful and knowledgeable. therefore, I would like to thank you for the efforts you have made in writing this article. dewavegas

  39. Fish Tales: From Fin-tastic Facts to Scales of Sustainability
    Fish. The very word conjures images of shimmering scales, rippling fins, and a life spent exploring the watery depths. But did you know that beneath this seemingly simple exterior lies a world teeming with diversity, intrigue, and even a touch of the bizarre? Buckle up, landlubbers, as we dive into the fascinating world of fish!
    storeopinionca

  45. It is advertising and marketing offers advertisments so as to practical research ahead of placing. In other words to jot down more appropriate area in this way. Team Building

  46. great post, very informative. I wonder why the other specialists of this sector don’t notice this. You should continue your writing. I am sure, you’ve a huge readers’ base already! 도봉구

  48. Its a great pleasure reading your post.Its full of information I am looking for and I love to post a comment that “The content of your post is awesome” Great work. 1win

  50. Wonderful article, thanks for putting this together! This is obviously one great post. Thanks for the valuable information and insights you have so provided here. 1win

Leave a Reply

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