Rallying call for railways: gearing up for a new era in rail distribution

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It has been a long time coming but in the not too distant future it may be possible to book train journeys on any channel. This could be on anything from an online travel agency site to a travel meta-search engine, as a corporate online booking tool for business trips or even on an airline’s website. EyeforTravel’s Ritesh Gupta investigates

Rail distribution is about to break through several technological barriers. That said, according to SilverRail Technologies, a specialist in this arena, the industry still has a way to go before it will be possible to buy a single rail ticket that allows you to travel across multiple operators’ trains like we can in air today.

For rail operators, technology solutions and distribution solutions go hand-in-hand; the right technology is, after all, a critical foundation for a successful distribution strategy. It’s more than just technology though; one of the hurdles that has prevented the rail industry developing a global distribution strategy is a lack of standards. This makes it difficult for rail operators to broaden their distribution efficiently and effectively outside their home markets. As a result of the lack of standards travel distributors would need to build a new and unique connection with each and every rail operator if they wanted to provide their customers with a compelling rail proposition.

According to Cameron Jones, vice president, commercial, SilverRail Technologies, this is just not feasible and also why we only see a few online travel agencies selling a few rail operators’ tickets - the business case has just never stacked up.

It is also one of the key obstacles that SilverRail claims to have solved. “We’re not only building the infrastructure for travel distributors to connect to rail operators through a single system, but we’re establishing these standards and operations,” says Jones. These include a global station code standard, commission distribution services and multi-currency settlement services that allow travel distributors to easily access and work with multiple rail operators all over the world.

Expanding reach 

SilverRail has made major strides in revolutionising the way rail journeys are planned and purchased. “We’ve now connected to seven rail operators’ systems in Europe and North America (USA and Canada) enabling new channels to open up for leisure and corporate, domestic and international distribution. Ebookers, the first major international online travel agency to sell rail will be launching this quarter,” says Jones.

The company also has multiple corporate online booking tools accessing its global footprint of rail operators and is helping rail operators reach new customers.

“Looking more broadly at the industry, it is exciting times in Italy with the launch of the new high-speed rail carrier ‘.italo’ backed by Ferrari. This marks the first time a privately run high-speed rail carrier takes on a government run national rail operator. In this instance consumers are the winners with more choice, better service and lower prices. We expect to see more of this style of competition emerging across more markets in Europe,” says Jones.

As travel distribution continues to evolve and consumers choose multiple new channels to research and purchase their travel, rail operators need to have their product available where consumers are buying other travel products like air, hotel, car and packages. Consumers should be able to make an informed decision considering all options, including rail, which were previously unavailable, like air + rail, air or rail, and rail + hotel/ car packages. Rail operators need robust distribution platforms that provide the scale to enable their tickets to be available in air searches in channels like Expedia, ebookers, Kayak, Skyscanner and so on.

Jones says this opens up rail to millions and millions more eyeballs if considering the size of the global customer base these travel retailers have.

Consumers demand a quick, simple, intuitive shopping experience online that is consistent across multiple countries.

“Consumers shouldn’t need to be trainspotters to find the right train at the right price and understand the validity and restrictions of their ticket,” says Jones. “All this should be possible in the consumer’s own language and home currency.” After all, this is already possible with other travel products like, air, hotel and car. Buying a rail journey online in a home market is possible as consumers have learned the ‘ins and outs’ of the rail operators website. “But anything outside this becomes more difficult and sometimes impossible,” he says.

Yet this is changing and we will see ebookers selling rail for the first time this quarter powered by SilverRail’s global rail ticketing platform. Other global online travel agencies are following close behind as they move to capture the swell of customers shifting from air to rail.

Overcoming traditional challenges

There are a couple of key areas where progress is made:

-     Booking a cross-border rail journey has always been considered to be a tough task. And cross-border rail journeys are still dominated by JVs run by rail operators like SNCF, DB, SBB, Renfe, SNCB and so on. However, Eurostar is operating more independently with plans to extend its network reach into new markets. These international cross-border rail journeys are still a niche segment when considering the total size of the rail market, however rail liberalisation in the European Union is providing a catalyst for competition in the cross-border rail market. More competition means rail operations need to be on top of their game when it comes to distribution,” says Jones.

-     Rail packages are still not widely available other than on some leisure routes like Eurostar’s London to Paris/ Brussels. “Online travel agencies' expertise is providing compelling customer driven packages and as they enter this space making rail available to the mass domestic and international market we will see more rail + hotel/ car packages or air + rail packages. There is no reason why rail operators cannot exploit this segment to attract more leisure customers filling empty seats,” says Jones.

Continuous improvements

At SilverRail the team is adding new functionality to its API (application programming interface) every four weeks. This continuous improvement is driven by progress in adding new rail operators to its global rail-ticketing platform SilverCore. The company prioritises the functionally based on its customers’ needs in the leisure and corporate markets.

“Each time we connect a new rail operator’s reservation system we add functionality to bring it up to the ‘high water mark’ of all the previous connections, so the platform continues to evolve,” says Jones.

The company has seven rail operators connected and plans to add three more before the end of 2013.

So it seems the industry is getting closer to letting travellers book rail tickets via their preferred channel.

“We will be releasing our first version of journey planning this year which will allow a customer to plan a rail journey between two cities across multiple countries such as Birmingham to Brugge,” he says. They will also be able to package multiple rail operators in one transaction. All this opens up a whole new market for rail operators and travel distributors.

In addition, in the corporate travel arena where rail is often avoided due to its complexity, travel management companies (TMCs) will finally have the chance to achieve efficiencies similar to other travel products. Now it will be possible for agents to book rail all over the world from any of the TMC’s geographical locations, be that a centralised office/ hub or regional locations.

Going by the latest developments, rail could soon be as easy to book as air.

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