Industry leader attributes stable revenue stream to pre-booked vacations
April 19, 2012
OLYMPIC VALLEY – Snow sport enthusiasts were likely suffering a “snow hangover” last spring, according to Ralf Garrison, director of Denver-based Mountain Travel Research Program, an organization that provides marketing services and statistics to destination resorts around the country.
Still reeling with exhilaration from the copious amounts of snowfall in the 2010-11 winter, skiers and snowboarders booked their 2011-12 ski vacations well ahead of time, Garrison told his audience of businesspeople at the 37th annual Mountain Travel Symposium in Squaw Valley on Wednesday.
But after a warm and dry winter, during which mid-season bookings dropped off precipitously a few months into the ski season, the pre-booked reservations began to look not only like a godsend, but also a windfall.
“The story between 2011 and 2012 is different indeed,” said Garrison, “you don’t need me to tell you that.”
Garrison said the strength of the beginning of the season is what kept many establishments afloat when bookings flagged. But research collected by Garrison’s company near the end of the season also showed a slight increase in the average total revenue brought in by U.S. destination resorts.
Garrison attributes the increase to a rise in room rates, a slightly improving economy and the stability of the destination resort business model.
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“Economically, if you look at the season from a destination standpoint, there is a very different story from the lift ticket side of the equation,” Garrison said in a phone interview. “Destination travelers still spend money, but they spend it at shops and dining facilities rather than on a lift ticket.”
Visitors to a destination resort stay longer and come even when the snow is not cooperating, he said, as opposed to day skiers who often stay away when snow conditions are bad and don’t spend as much money when they do arrive.
Garrison challenged attendees of the conference to consider the how they might drive their own business and create economically sustainable products in order to prevent a future marred by headaches.
Driving the business of mountain travel
Following Garrison’s introduction, a panel comprised of Intrawest’s Chief Marketing Officer Ian Arthur, Chief Marketing Officer of Vail Resorts Kirsten Lynch and Visit Florida Chief Marketing Officer J. William Seccombe discussed ideas on how businesses might market the mountain travel industry. The panel was moderated by President of Reach Advisors James Chung.
“The strengths of the ski industry are strengths other industries would kill for,” said Lynch, who previously worked on an oatmeal rebranding campaign. “A fundamental strength of this business is how people connect to it.”
Hers was a point the entire panel agreed upon.
“There is great passion for various sports, but the difference with skiing is that there is a higher level of identification. I don’t ski,” said Arthur, “I’m a skier. Skiing is a lifestyle, a community, and that sets us up for a lot of opportunities.”
The Intrawest brand bills itself as “a leader in experiential destination resorts” and has made a business around the creation of ski mountain real estate, such as ski mountain base villages and other all-inclusive, destination resorts.
Those who are passionate about skiing advocate for skiing, added Seccombe.
“I can guarantee you that guy at the post office (in Florida) is not an excellent skier,” he said “but he talks about it like he is. Consumers like this share their experiences.”
The panel expressed uniform agreement that skier passion should be harnessed and used to market the industry.
“You can go on a ski vacation with your family. It’s a big deal. You play cards together, you hang out in the evening together. You’ll probably pass this on to your kids,” said Arthur. “We need to leverage this to grown the business.”
“Certainly,” said Chung, “it’s not the surface level product, it’s the emotion it engages.
“Exactly, but what do each one of our businesses do to tease that out?” said Arthur.
But the panel also agreed the issue was not about gaining market share. Today, when the total number of skiers has leveled out at 13 million, industry leaders must work together to bring more skiers and snowboarders into the market.
“How do we expand the audience is really the question here,” Arthur said.
Rocks in the trail
Industry marketers have recognized for years that barriers to enter into skiing or snowboarding are high. Not only is the sport expensive, but also the activities have a learning curve and require commitment to master – and on an interpersonal level, Arthur pointed out, many people begin skiing only when they are invited to do so by friends.
The panel discussed the need for innovation, creativity and risk-taking when attracting new markets.
Lynch said the ski industry should borrow low-hanging fruit from other travel and tourism sectors by incorporating the marketing and management techniques of cruiseships, airlines and theme parks. She talked about the difficulties of schlepping an entire family’s ski gear from the airport to their accommodations, and how the ski industry can look to guest luggage management practices at Disney to help improve the guest experience.
“We don’t want to plasticize the sport, but we do want to make it easy for young families to go on a ski vacation. Marketing is no longer about us telling you all the good things we do,” she said. “It’s about what we know about you and what you need.”
NASCAR, Seccombe added, allows spectators to log on to a website and watch races from the cockpit of their favorite driver. He offered a comparison between the amount of money spent on marketing and improving the skiers’ experience and the amounts spent on novel experiences such as the Wizarding World of Harry Potter, the new Universal Orlando theme park. The New York Times reported in 2009 the theme park cost an estimated $265 million to build.
“We need to tap into new experiences,” he said. “There is great news; people are traveling, but they just aren’t traveling here.”
The panel urged the audience to think beyond market share and to recognize families and travelers were selecting fro a variety of destination when choosing how to spend their vacation – and their vacation dollars.
“If we as an industry grow the base,” said Arthur, “then all boats will rise.”