At the NSAA Convention & Trade Show in May, one session addressed the return on investment for terrain parks. The session was hosted by John Rice, the longtime president and GM of Sierra-at-Tahoe and godfather of terrain parks; the primary panel member was premier terrain park designer and operator Chris “Gunny” Gunnarson.
Observing John, Gunny, and the other panelists explain various rationales to support the ROI of terrain parks, I found myself wondering, why is this even a question at all?
I should admit that, as a resort owner, I have not been very supportive of extensive terrain park construction, along with its cost of maintenance, damage to equipment and grooming vehicles, snowmaking commitment, and higher risk for customer injury and potential litigation. I attended this session to see whether terrain parks were a good investment, or simply a necessary evil that we offer to a very limited market. Should we keep the lid on the investment we make in park management, wages, electricity, machines, etc.?
I have read the Facebook posts and nasty emails about my complete ignorance on the subject. Still, I have stuck to my guns and kept terrain park costs to a minimum. This past winter, I used the excuse that the 500 inches of snow we received made it difficult to keep the park intact, whether I thought it was a good expenditure or not.
But sitting there, listening to John and Gunny work the calculus on ROI, I kept thinking about Michael Berry’s “state of the industry” speech, and the “Path to Growth - Facing the Challenges” NSAA Journal supplement I had received in advance of Michael’s presentation.
The Demographic Time Bomb
As a longtime student of demographics, the answer to our future success or failure lies 100 percent with Generation Z—our children just now being born, up to those just now entering college. In my case that includes one granddaughter, age 2, and my recently born grandson, as well as the 29 great grandchildren of my 89-year-young mother-in-law, Nell.
The Baby Boomers are heading to the barn. Generation X will hang in for a while, but not nearly in the same numbers as my Boomers. And the Millennials, while big in numbers, clearly don’t ski or ride anywhere near as often as we do, or did.
The most compelling graph in Michael’s presentation, to my mind, demonstrated the lack of days skied by 19- to 35-year-olds as compared to us Boomers. It isn’t that the Millennials don’t ski or ride; they do, just half as much as we Boomers did. That’s not nearly often enough to offset the diminished visits we are destined to see from Boomers in the coming decade.
Not to mention that we have shrunk from 10 million participants nationally to 8.4 million.
With all that, no one can dispute that the salvation for keeping annual attendance above 50 million in 2025 lies with Generation Z, the children of the Millennials.
The Role of Terrain Parks
Anyone who really gives this serious thought must admit that we cannot entice, excite, and thrill Generation Z with natural terrain alone. Engaging this generation will require an extensive commitment to adding manmade terrain features, in as many areas of our developed terrain as we possibly can.
If you’ve been following terrain park development, you know we’re not talking about massive features that require incredible commitments to grooming, snowmaking, and maintenance. It’s about “flow,” “newness,” and “creativity,” manageable and affordable features that can be changed often to maintain interest.
In conversation with me after the session, Gunny summarized the situation perfectly to me. Gunny’s a passionate snowboarder; both his young daughters are skiers, and his wife Jenn both skis and boards. His favorite days on the slopes now are two things: fresh pow, and spending all day with his daughters in the park.
Sometimes you can state a huge position by making an odd but relevant point, so here’s mine:
If every seven-year-old in America isn’t crying his or her eyes out at 4 p.m. at the bottom of the terrain park after riding in it for seven hours, because their dad or mom won’t let them go up for one more run through the park so dad or mom gets one more pic for their Instagram page, we are all in deep, deep trouble, with 45 million skier visits the likely outcome in 2025.
Am I overstating this? Maybe. But I am not willing to take the risk. Our industry has spent hundreds of millions on high-speed chairlifts, snowmaking, and terrain expansion over the past 37 years since we discovered we were in for a long run of flat market growth. What has the ROI been on all of these lifts, snowmaking expansions and new terrain?
I installed a used but beautiful fixed-grip quad this summer at China Peak for $800,000, replacing an old, center-pole double, our most popular lift. It was old, but still ran fine, had been expertly maintained, and never has a long lift line. Did I have to replace it? No. Was I right to replace it? Probably.
Did I do an ROI analysis? No. My gut tells me it will create excitement among Central Californians, who stuck with me after four years of drought and now two good seasons. It’s our first new lift since 2006. But I wouldn’t bet the ranch it drives significantly more business, or even has an adequate ROI.
It Comes Down to This
In my 40 years in this business, I’ve seen countless resorts invest millions in new lifts and runs, only to do the same or less business. Sure, we’re making more money with less, largely due to much higher prices and better margins.
So to come full circle: What is the ROI on terrain parks? I’m not sure—no more sure than I am about the ROI on my “new” lift, or the lift I’d like to install next season, or the extensive snowmaking expansion I’d like to make sometime, plus clearing a few new runs to expand terrain.
But I can tell you this: If you agree that the future of our industry hangs on how successful we are at enticing, exciting, and thrilling my son’s children and my grandchildren, you’d better take a very hard look at what that takes.
This past winter, I followed my nephew’s and niece’s young children all over China Peak. They showed me that the secret sauce is not groomed runs, regardless of their pitch. And it’s not fresh powder—not at age seven. No, it’s every jump, hit, rail, quarterpipe, bank, whoop-de-do, roller, and terrain change that gets them off the ground.
Just as it was for me when I was their age, come to think of it.