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

 

167,815 thoughts on “Railway Industry in France”

  5. There are some interesting points at some point on this page but I do not know if these people center to heart. There is some validity but I most certainly will take hold opinion until I consider it further. Great post , thanks therefore we want a lot more! Included with FeedBurner also buy google reviews

  9. Rapidly this kind of internet site can easily unquestionably recognition among virtually all blogging and site-building and also site-building individuals, to be able to the meticulous content or simply opinions. asiaqq

  12. Good day I am so glad I found your web site, I really found you by mistake, while I was looking on Aol for something else, Regardless I am here now and would just like to say thank you for a fantastic post and a all round enjoyable blog (I also love the theme/design), I don’t have time to browse it all at the moment but I have book-marked it and also added your RSS feeds, so when I have time I will be back to read a great deal more, Please do keep up the awesome work. cheap gaming chairs ebay

  20. Conveyancing Solicitors… […]below you’ll find the link to some sites that we think you should visit[…]…

  25. When I originally commented I clicked the -Notify me when new surveys are added- checkbox and from now on when a comment is added I receive four emails with the exact same comment. Possibly there is in any manner you’ll be able to eliminate me from that service? Thanks! 不可燃材料

  29. 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. smm panel

  34. I’m impressed, I must say. Really rarely do you encounter a blog that’s both educative and entertaining, and let me tell you, you might have hit the nail on the head. Your concept is outstanding; the issue is something which not enough people are speaking intelligently about. My business is very happy i always stumbled across this within my try to find something relating to this. buy oxicodone sandoz

  35. Hi there, i read your blog occasionally and i own a similar one and i was just curious if you get a lot of spam feedback? If so how do you stop it, any plugin or anything you can suggest? I get so much lately it’s driving me crazy so any support is very much appreciated. k86sport

  39. Oopsmight have spoken too soon. Young teams dont know how to play late in games, especially playoff games. Total self-destruction. Can they now learn to win? Go Cs. situs slot gacor

  41. Pretty good post. I just stumbled upon your blog and wanted to say that I have really enjoyed reading your blog posts. Any way I’ll be subscribing to your feed and I hope you post again soon. Big thanks for the useful info. 강남달토

  43. Tutorguideinindia introduced you to the CLAT Coaching Institutes . All of the institutes have well-trained faculty members. If you are interested in joining clat coaching classes, you should visit tutorguideinindia.com to register for demo classes.

  44. We provide gorgeous maiden escorts in PAKISTAN to keep you happy by sensuous dick-escorts. Sorry, actually ‘A paid female escorts. It is slightly tough to find a caring companion for free until you’re not handsome, so, never scruple to pay for something which satisfies you. Everything is paid in this world, even the life you are living has been borrowed for several years. Escort services in PAKISTAN have been a perfect option for many pleasure seekers for years.
    escorts in islamabad

  45. จุดด่างดำ บริเวณใบหน้าหมองคล้ำ ไซโกโนะ คอลลาเจน
    ไม่แจ่มใสช่วยยั้งการผลิตเม็ดสีผิว saikono
    กระตุ้นการผลัดเซลล์ผิว GOJI BERRY EXTRAC สารสกัดจากโกจิเบอร์รีมีสารต้านอนุมูลอิสระสูงช่วยคุ้มครองและก็รักษาผิว จากรังลีแสงอัลตราไวโอเลต มีวิตามินซีสูตระหนี่ว่าส้ม 500 เท่า GRAPE SEED EXTRACT สารสกัดจากเม็ดองุ่น Saikono collagen ชะลอไม่ให้ผิวหนังแก่ก่อนวัยรวมทั้งแห้งด้าน ไซโกโนะ
    ลดปัญหาสำหรับคนที่มีสีผิวไม่บ่อยนักกัน ACEROLA CHERRY EXTRACT

  46. จุดด่างดำ บริเวณใบหน้าหมองคล้ำ ไซโกโนะ คอลลาเจน
    ไม่แจ่มใสช่วยยั้งการผลิตเม็ดสีผิว saikono
    กระตุ้นการผลัดเซลล์ผิว GOJI BERRY EXTRAC สารสกัดจากโกจิเบอร์รีมีสารต้านอนุมูลอิสระสูงช่วยคุ้มครองและก็รักษาผิว จากรังลีแสงอัลตราไวโอเลต มีวิตามินซีสูตระหนี่ว่าส้ม 500 เท่า GRAPE SEED EXTRACT สารสกัดจากเม็ดองุ่น Saikono collagen ชะลอไม่ให้ผิวหนังแก่ก่อนวัยรวมทั้งแห้งด้าน ไซโกโนะ
    ลดปัญหาสำหรับคนที่มีสีผิวไม่บ่อยนักกัน ACEROLA CHERRY EXTRACT

  49. Hi there, just became alert to your blog through Google, and found that it is really informative. I¡¦m gonna watch out for brussels. I¡¦ll appreciate if you continue this in future. Many people will be benefited from your writing. Cheers! 防火隔音

Leave a Reply

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