JDA Passenger Rail Brochure

8/3/2019 JDA Passenger Rail Brochure

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Passenger Rail

Optimize capacity and

price to improve business

performance with JDA

Price Sensitive Revenue

Management solutions

Balancing Supply and Demand to

Drive Proft and Service Levels


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Challenge: Optimizing Capacity and Balancing

Supply and Demand

The high-speed passenger rail sector has become increasingly

vital to the economic and environmental future of industrialized

nations worldwide. With the promise of such signicant benets

as faster, more ecient mobility, signicant energy savings and

reduced environmental damage, countries around the world are

continuing to invest in, extend and maintain their high-speed

rail systems.

Ecient Use o Capacity

These rail operators are investing in new, faster trains, with

increased capacity in the form of additional carriages or

double-decker trains to provide improved service. However,

increased capacity to address high-demand peak travel times

magnies the eect of o-peak trains carrying fewer passengers

per carriage and can add extra costs without an increase in

revenues.

Environmentally friendly and sustainable green transportation,

high-speed trains are signicantly more energy ecient than

airplanes and even automobiles. However, in order to decrease

pollutants and green house gas emissions, available capacitymust be used as eciently as possible since an o-peak train

with a low-load factor generates more carbon emissions per

passenger than a full airplane. Thus, optimizing capacity at all

times is a critical rail operator objective.

Price and Demand Elasticity

While faster trains are reducing passenger travel time,

heightened airport security measures mean that door-to-door

travel times for airlines are increasing. The result is that the

train now competes strongly with airlines in markets where

journey times are under four and a half hours. Additionally,

as deregulation starts to open up national and international

markets, rail companies are starting to compete with each otherin what used to be captive markets.

Rail companies must also deal with the realities of todays

market transparency and heightened price competition created

by the Internet and the increasingly price-driven business

landscape. In some markets, business passengers are moving

away from exible, high-priced tickets into restricted advance-

purchase tickets that place increased pressure on yields. Further,

special online promotions and competitive pricing are leading

to higher numbers of price-sensitive passengers seeking and

booking discounted tickets.

To ensure that high-speed passenger rail can deliver on

its potential for improved environmental, economic and

service outcomes, rail operators must be able to respond to

changing market conditions and competitive pricing actions

while also balancing passenger demand with ticket prices

and seat capacity. In order to eectively address these new

industry challenges, rail operators must look beyond their

current revenue management practices and systems to adopt

a more sophisticated approach that brings price elasticity

and competitor data into the heart of revenue management

systems, enabling them to more evenly spread demand acrosspeak and o-peak travel times.

Solution: JDA Price Sensitive Revenue

Management

JDA Pricing & Revenue Management solutions delivers Price

Sensitive Revenue Management capabilities through world-class

demand forecasting, price optimization and inventory/capacity

management solutions. These solutions help rail companies

grow demand and revenue, provide better service and enhance

market share. JDA is an industry leader in Price Sensitive

Revenue Management innovation, and many of todays largestand most protable global companies are leveraging JDAs

solutions for passenger rail to take their businesses to the

next level.

JDAs Passenger Rail Pricing & Revenue Management

Innovations:

2003: First passenger rail origin and destination optimization

revenue management solution

2006: First passenger rail price-sensitive forecasting solution

2010: First passenger rail revenue management solution

implemented in Japanese market

2011: First implementation of price optimization inpassenger rail

Unlike traditional revenue management methodologies,

JDA Price Sensitive Revenue Management solutions place an

emphasis on optimizing price rather than focusing on inventory

controls alone. JDAs solutions enable companies to optimize

revenue potential across all customer segments with a well-

dened strategy based on price elasticity modeling, accurate

demand forecasting and real-time visibility into competitor

pricing.


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Traditional Revenue Management JDA Price Sensitive Revenue Management

Focuses on occasions when demand outstrips supply Makes pricing decisions that optimize the entire network at

all times

Assumes demand is what it is Understands that demand can change depending on what

price is charged

Increases prots by yielding out the least desirable

business

Uses price to improve market share from competitor sets

Manages product availability through inventory Manages prices directly

Uses competitor price data to evaluate revenue

management decisions

Pulls competitor data into the heart of forecasting and

pricing processes

JDAs Price Sensitive Revenue Management solutions position rail

operators to achieve optimal protability even while addressing

economic and competitive demands. This dynamic, automated

and exible approach to pricing and revenue management

combines pricing and yield management into a more cost-

eective, ecient business process that positions you to:

Maximize profts and revenue. Through the combinationof automation, demand forecasting, price optimization and

inventory/capacity management, you can gain a competitive

advantage and boost revenue-generating opportunities by

managing revenue in markets without price restrictions.

Improve orecast accuracy. Advanced forecasting enables

you to analyze how a price increase or decrease will aect

demand. By leveraging robust demand segmentation, you

can adjust forecasting based on current booking patterns,

capacity and inventory.

Optimize pricing through up-to-date competitive data.

Integrate advanced price elasticity modeling, customer

segmentation and competitive pricing into your core

decision-making process, enabling you to set the right pricesand dierentiate customer value in real time across multiple

fare classes and journeys.

Balance supply and demand through improved visibility.

Using price optimization, you can adjust prices based on

uctuations in demand on any given day or route, as well as

manage high- and low-demand periods and fare structures.

Understanding Passenger Demand

Demand forecasts must incorporate an understanding

of customers willingness to pay. Given increased price

transparency, it is essential to account for price sensitivity sincerecommending a change in price will in turn inuence demand

for your services. Only price-sensitive demand forecasts can

deliver the level of accuracy required by a price optimizer to

maximize rail companies revenues.

By analyzing all available sources and other historical and

competitor data, JDA Price Sensitive Revenue Management

solutions can generate an accurate, unconstrained forecast

that enables you to better manage inventory and make more

informed decisions that will yield prots. You can proactively

identify where high demand is likely to occur and where low

demand exists to make optimal price recommendations that

will help generate the most revenue. Operators can then use

marketing campaigns to stimulate demand at low demand

times, as well as for seasonal activities and special events.

Applying an Optimal Mix o Pricing and Products

Armed with an accurate demand forecast, you can employdemand steering tactics related to prices and products on sale.

Although price is a primary driver of choice, exibility is also

important to many rail customers. Such customers are prepared

to weigh trade-os between price and exibility by purchasing

more expensive tickets that allow exchanges or refunds.

Operators can use the mix of prices and products on sale to help

control when customers travel.

Understanding the scale and size of both peaks and shoulder

peaks enables rail operators to direct demand to less busy

times and smooth demand at the peak period. With JDA Price

Sensitive Revenue Managements sophisticated forecasting

technology along with critical data, you can oer attractively

priced products to passengers traveling at both peak and o-

peak times to secure the best price and optimal passenger

numbers.

Key JDA Price Sensitive Revenue Management

Benefts:

Signicantly improved demand forecasts, providing a more

accurate view of future demand for all services and markets

Optimal price setting for all train departures until the day of

departure, based on price-sensitive demand forecasts

Reduced manual overrides and increased number ofautomatically routed pricing decisions, enabling analysts to

focus their attention on high-value opportunities rather than

routine tasks

Appropriate response to competitor pricing actions by

integrating competitive prices

Understanding of how price changes in second-class cabins

would impact demand in rst-class cabins by incorporating

cross-cabin eects

Ability to model how modifying price on one train could

change demand on another departure by incorporating

cross-train eects


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Passenger Rail

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Copyright 2011, JDA Software Group, Inc. All rights reserved. JDA is a Registered Trademark of JDA Sof tware Group, Inc. All other company and product names may be Trademarks, Registered Trademarkor Service Marks of the companies with which they are associated. JDA reserves the right at any time and without notice to change these materials or any of the functions, features or specications o

any of the software described herein. JDA shall have no warranty obligation with respect to these materials or the software described herein, except as approved in JDAs Software License Agreemenwith an authorized licensee.

UK & Northern Europe

+44 (0) 1344 354500

France & Southern Europe

+33 (0)1 56 79 27 00

US

+1 800 479 7382

Canada & Latin America

+1 480 308 3555

WEB

www.jda.com

EMAIL

[email protected]

ASIA PACIFIC

Singapore

+65 6305 4350

Australia

+61 2 8912 7900

Bangalore

+91 80 3028 8888

Mumbai

+91 22 3088 7878

Japan

+81 3 6418 1100

China

+86 21 2327 9400

EUROPEAMERICAS

08.08.1

Real Results. Fast.

JDA Software can help your company upgrade its traditional revenue management

systems to leverage more sophisticated Price Sensitive Revenue Management capabilities

by following a phased approach that meets your timeline and resources. Here are some

of the real results that our customers have achieved from using JDA Pricing & Revenue

Management solutions*:

Boosted annual revenue by more than US$7 million

Improved forecast accuracy by 17 percent

Improved revenue on leisure trains by up to 20 percent

Enhanced overall passenger volume by 27 percent

Helped double the number of daily pricing decisions Freed up analyst time to focus on planning and implementing special event details

Optimized revenue management strategies

Substantially improved business operations

Leveraged price as an eective means to gain market share from competitors

Improved internal communication

* Represents actual results realized by JDA customers.

About JDA Pricing and Revenue Management Group

JDA Pricing and Revenue Management Group, a global business unit within JDASoftware, is a leading provider of Price Sensitive Revenue Management solutions that

help companies improve prots by balancing supply and demand through innovativeforecasting, pricing and revenue management. For more than 25 years, companies in

the travel, transportation, hospitality and media industries have beneted from theongoing innovation and deep domain expertise from JDA. To learn more about JDAPricing and Revenue Management, please visit www.jda.com/revenuemanagement.

Suzanne Donnelly,

Head of Revenue,

East Coast Main Line

What JDAs solution allows usto do is achieve greater prots.With three quarters of passengersbooking in advance, were able toanalyze data, as well as monitorand understand our customersbehavior to accurately priceour seats. We have delivered a3 percent increase in passengernumbers in the past year and weare planning for growth. JDA Rail

Price Manager has helped EastCoast deliver against our revenuetargets and we look forward tocontinuing success.

Why are leading passenger

rail companies using JDA

Price Sensitive Revenue

Management?

Documents

JDA Passenger Rail Brochure