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

 

163,933 thoughts on “Railway Industry in France”

  1. This is such a great resource that you are providing and you give it away for free. I love seeing blog that understand the value. Im glad to have found this post as its such an interesting one! I am always on the lookout for quality posts and articles so i suppose im lucky to have found this! I hope you will be adding more in the future… تطبيق رشفة

  4. 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. Vergleich

  5. Great Information sharing .. I am very happy to read this article .. thanks for giving us go through info.Fantastic nice. I appreciate this post. ifvod

  9. The Twitter application page will open. This is good if you’ve got a few thousand followers, but as you get more and more the usefulness of this tool is downgraded. silk blouses

  10. Excellent website. Lots of useful information here. I am sending it to a few friends ans also sharing in delicious. And naturally, thanks for your sweat! silk shirts

  11. Great Information sharing .. I am very happy to read this article .. thanks for giving us go through info.Fantastic nice. I appreciate this post. ITAD

  12. Positive site, where did u come up with the information on this posting?I have read a few of the articles on your website now, and I really like your style. Thanks a million and please keep up the effective work. joker388

  13. I am thankful to you for sharing this plethora of useful information. I found this resource utmost beneficial for me. Thanks a lot for hard work. ifvod

  14. 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 extra information? It is extremely helpful for me. login joker123

  16. Interesting and amazing how your post is! It Is Useful and helpful for me That I like it very much, and I am looking forward to Hearing from your next.. smihub

  21. Have you ever thought that you can earn profit by selling 5 Rupee coin which you can get from normal circulation and sell them at a very goo…”,”datePublished”: “2021-11-13T11:49:00+05:30 Old coin buyer

  24. Yamaha Motor Company won its first race just 10 days after the company was founded. And this burning desire to go racing continues to define Yamaha to this day, and it is what enables the company to create high performance supersport bikes like the latest YZF-R1.
    Recommended Price
    849,000 .-
    *Installment 0 Baht/ Month

    https://www.yamaha-motor.co.th/bigbike

  27. Hello I am so delighted I located your blog, I really located you by mistake, while I was watching on google for something else, Anyways I am here now and could just like to say thank for a tremendous post and a all round entertaining website. Please do keep up the great work. Work Marketplace for Freelancing

  28. Thanks for a very interesting blog. What else may I get that kind of info written in such a perfect approach? I’ve a undertaking that I am simply now operating on, and I have been at the look out for such info. homeopathic medicine for sex

  34. Easy to Register & Login Sbobet on 389Sports Trusted Sites

    Usually every new user will have difficulty registering on the main sbobet site because they have been exposed to positive internet or newsletters. However, you don’t need to worry about that, the sbobet site has collaborated with 389Sports to handle a registration process where new users can register and login sbobet on our 389Sports site.

    It already has millions of players in it every day, login sbobet and continues to do an online soccer match to get a very extraordinary income. If you are interested in playing online soccer gambling on the 389Sports site, you can directly register & login sbobet first to get an official Sbobet user ID. Come on, immediately register your account and play with other members to compete.

  37. Enjoy most reliable Chandigarh Escorts Services. Female Chandigarh Escorts, get hot and sexy call girls from our escort agencies and feel exciting moments in a pleasant ambiance

  43. I’m not that much of a online reader to be honest but your blogs really nice, keep it up! I’ll go ahead and bookmark your site to come back later. Many thanks. 토토

  47. Hello, guys welcome to my Bio I am Ankita Sharma & I am living in Delhi (City in India). I like Delhi City and Delhi people. My age is 21 years old. My Hobbies Dancing and Modeling. And I like to add new friends. Like young boys and Girls.
    Delhi Escorts

Leave a Reply

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