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

 

177,839 thoughts on “Railway Industry in France”

  1. I want you to thank for your time of this wonderful read!!! I definately enjoy every little bit of it and I have you bookmarked to check out new stuff of your blog a must read blog!

    카지노사이트

  2. Very nice article and straight to the point. I don’t know if this is truly the best place to ask but do you folks have any idea where to get some professional writers? Thank you. Feel free to visit my website;

    바카라사이트

  3. I am glad to discover this page. I have to thank you for the time I spent on this especially great reading !! I really liked each part and also bookmarked you for new information on your site. Feel free to visit my website;

    토토사이트

  4. You make so many great points here that I read your article a couple of times. Your views are in accordance with my own for the most part. This is great content for your readers. Feel free to visit my website;

    카지노사이트

  7. Venuepro is made up of 14 comprehensive modules that deliver all aspects of event and venue management. Venuepro is constantly under further development by consulting with industry experts and global venue and space owners. Venue Management Systems

  18. I was just lookuping for this information to get a while. Approximately two hrs of online lookuping, thankfully I obtained it in your website. I do not understand why Bing don’t exhibit this form of resourceful internet sites in the first web page. Generally the leading websites are craps. Perhaps it is time to alter to another research engine. ინდოეთის ბიზნეს ვიზა

  19. I genuinely enjoy your website, but I’m having a problem: any time I load one of your post in Firefox, the center of the web page is screwed up — which is bizarre. May I send you a screenshot? In any event, keep up the superior work; I definitely like reading you. Индия за бизнес виза

  22. I want to show my thanks to you just for rescuing me from such a predicament. Because of looking throughout the world wide web and coming across thoughts that were not helpful, I thought my entire life was well over. Living without the approaches to the issues you’ve solved as a result of your main guide is a crucial case, as well as the kind which may have adversely damaged my career if I had not noticed your web page. Your actual skills and kindness in dealing with all the stuff was crucial. I don’t know what I would’ve done if I had not come upon such a step like this. I can at this time look ahead to my future. Thanks so much for the impressive and effective help. I will not be reluctant to recommend your web sites to any individual who should receive guidelines on this problem. Iarratas Ar Líne Víosa na Tuirce

  24. It’s very interesting. And it’s fun. This is a timeless article. I also write articles related to , and I run a community related to 카지노사이트 . For more information, please feel free to visit !!
    🙂

  29. Youre so cool! I dont suppose Ive learn anything like this before. So good to find any individual with some original thoughts on this subject. realy thanks for starting this up. this web site is one thing that’s needed on the web, someone with just a little originality. helpful job for bringing something new to the internet! Melatonin Vape Pen

  31. Yes i am totally agreed with this article and i just want say that this article is very nice and very informative article.I will make sure to be reading your blog more. You made a good point but I can’t help but wonder, what about the other side? !!!!!!Thanks payment gateway partner

  34. When I originally commented I clicked the “Notify me when new comments are added” checkbox and now each time a comment is added I get four e-mails with the same comment. Is there any way you can remove people from that service? Many thanks! Rehab Center

  37. I concur with your conclusions and will eagerly look forward to your future updates. The usefulness and significance is overwhelming and has been invaluable to me! Umzug Zürich

  40. Odd this post is totaly unrelated to what I was searching google for, but it surely was indexed on the first page. I guess your doing one thing proper if Google likes you sufficient to position you on the first web page of a non comparable search. cocaine for sale

  42. I beloved as much as you will receive carried out right here. The comic strip is attractive, your authored subject matter stylish. nevertheless, you command get got an shakiness over that you would like be delivering the following. unwell undoubtedly come further beforehand once more since precisely the similar nearly a lot steadily within case you protect this hike. <a href="https://blogs.cornell.edu/advancedrevenuemanagement12/2012/03/26/railway-industry-in-france/comment-page-557/#comment-59448

  46. Admiring the time and effort you put into your website and in depth information you present. It’s good to come across a blog every once in a while that isn’t the same old rehashed information. Wonderful read! I’ve bookmarked your site and I’m adding your RSS feeds to my Google account. funko pop

  47. Very efficiently written information. It will be beneficial to anybody who utilizes it, including me. Keep up the good work. For sure i will check out more posts. This site seems to get a good amount of visitors. best washing machine

  49. Very efficiently written information. It will be beneficial to anybody who utilizes it, including me. Keep up the good work. For sure i will check out more posts. This site seems to get a good amount of visitors. best washing machine

Leave a Reply

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