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September 2006

Thoughts from Chairman Bill

New NSAA chairman bill Jensen speaks to SAM about the state of the industry and his vision for the future.

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With construction cranes towering over Lionshead, working to make over “Vail’s Front Door,” newly elected NSAA chairman Bill Jensen has a lot at stake. We were surprised, then, when in late July the switchboard put us on his line, and he picked up himself. Where was the executive assistant? We quickly scheduled an interview for early August. We arrived, armed with our doubts about how well the COO of the largest resort in America could represent the interests of NSAA’s smaller member areas, and found our way, unescorted, back to Jensen’s corner office in the rather plain (by Vail standards) Treetops building. There, in the shadow of the Lionshead parking structure, we settled into a comfortable couch and dove into our questions. Jensen sat against a wall, away from his desk, choosing his words carefully and patiently waiting as we recorded them as faithfully as we could.

What are your goals for the next two years?

Let me begin by saying I look at NSAA as an industry voice and resource. It doesn’t represent the business—the resorts are businesses unto themselves.

The issues facing the industry are on the environmental side and skier safety. I hope that Vail Resorts’ announcement that it’s going 100 percent wind power will at least make the rest of the industry aware of the opportunities with wind. I hope that many resorts will take a look at wind power, and whether they buy 100 percent or a smaller amount, that the industry takes this opportunity to be perceived as a business leader on environmental issues. With all the talk about global warming and climate change, alternative energy sources are a mainstream step in addressing that issue.

Skier safety is an issue the industry deals with as individual resorts and collectively. I hope we can continue to work on skier safety, both from the education and awareness standpoint and on the enforcement side, because that’s integral to the success of individual resorts. Skiing and snowboarding have to be perceived as safe family activities.

What do you mean about enforcement?

At Vail, we started a program last year, and I know that Steamboat has a similar program, of publishing in the newspaper each week an ad about our commitment to safety and enforcement. We shared with our guests and the community that we are enforcing safety every day, and that we were revoking skiing privileges for violations of the Skiers Responsibility Code as well as other activities.

Did you actually revoke many tickets?

Our total for the season was over 1,000 [1,019, to be exact], and 7 people lost season’s pass privileges for the year.

It took a commitment on our side. Both our guests and the community see what we are doing each week in enforcement. We felt it was a positive thing; guest satisfaction scores for ski safety at Vail in particular were the best we’ve seen in the seven years we’ve measured it.

To me, NSAA has done a good job with safety awareness and sharing best practices with the industry, but for the sport to stay safe and to have our guests perceive that it’s safe, enforcement is just part of the equation.
For our customers collectively, safety is a high priority, both from the equipment side as well as the experiential side. As chairman, it’s my hope to heighten our focus on this.

On the environmental front are there other things areas can do, other ways to be perceived as leaders?

All of us have a responsibility to be a steward of the environment. Each region has its own mix of priorities. It’s not just wind or water or energy conservation or wildlife, it’s a variety of activities we all undertake. I believe we are good stewards; perhaps increasing the visibility of our stewardship is the most positive way to convey our commitment to the public.

What about diversity? Vail has invested a lot of time and effort to address a new market, how important will that be for the industry at large?

Diversity is one of those issues that falls into a gray zone for NSAA. In some markets, diversity is a critical business issue. Whether you are in Colorado or New England, each has a slightly different opportunity.

NSAA has done a good job of including diversity as an educational component in its conferences and conventions; it’s on the business radar screen. We need to continue educating and talking about best practices, but ultimately the action on attracting minority groups falls back to the business entity.

A diversity effort has to be a business-specific action item. It’s no different than saying, “should the industry have a broader marketing effort?” That hasn’t worked. It’s not NSAA’s place to get involved in the business model for each resort. It comes down to individual resorts and how committed they need to be and want to be in using ethnic populations to broaden their business base.

Is it too early to ask where Vail is headed on that?

Vail has worked the last two years with Denver’s Alpino group at our Colorado resorts. We have a longer relationship with SOS that also provides an opportunity to a local ethnic demographic.

Ultimately, from the business side, as with the Growth Model, we’re bringing people to trial, but we have to ask, what’s our retention rate, and are we converting people to skiers? I wonder if it would make sense to invest in a more focused effort with smaller numbers, giving people of color multiple experiences, to see if they can transition from trial to commitment. We have to look at that in the broader context.

Roberto [Moreno, head of Alpino] has talked about the importance of having people of color in front-line positions, but I’m a strong believer that working at a ski resort is a lifestyle choice. To diversify our workforce, we need to get people who are passionate about the lifestyle, regardless of color. I’m not sure that just offering a program that gives ethnic minorities a one- or two-day experience will convert people to a lifestyle. So we’re reflecting on what we’ve learned in the last few years.

As an industry we’re committed to growing our business model and recognize that ethnic populations represent part of the opportunity. But how do we reach them in a way that generates a commitment to the sport and ultimately to a lifestyle, vs. just a one-day trip to the amusement park? We need to figure out how to make lifelong converts.

If you’re looking for lifestyle and retention, it tends to drive you back to your local communities first.

Does Vail’s size make it difficult for you to relate to smaller areas, or for smaller areas to relate to you? Can they look at you and say, “Yes, Bill understands our issues and problems?”

I’ve worked at smaller ski areas, and the business is very much the same whether you do 100,000 skier visits or one million. Neither business is very complicated, but bigger areas become a bit more complex, you have more employees, and your relationship with the community is much more integral.

I’ve always felt like I had a good relationship with Midwestern areas and I understand the challenges they face.

The industry has had a longstanding tradition of sharing ideas. We’re competitive with one another, but we’re very collegial. And we can all learn from one another. Some of the people I admire most in this industry operate smaller areas, people like Brian Fairbank [Jiminy Peak, Mass.]. His ski resort isn’t Vail, but it’s very successful and he does a spectacular job of operating it.

Three years ago I spoke on a panel at an NSAA convention, and one of my friends told me someone in back commented, “We’re not Vail, what can we learn from them?” At that point, we had discovered the success of 300- to 400-foot conveyor lifts in the learn-to-ski process, and it was a big “aha!” for us, and sharing that became a big “aha” for small ski areas. It absolutely goes both ways.

And NSAA has done a great job under president Michael Berry and his staff to create best practice opportunities. Whether it’s at the winter shows or the annual convention, we spend a considerable amount of time sharing best practices. There’s always a mix of large and small areas in these sessions. I try to attend all those meetings because those are the ones that make you think the most, that hold the most value.

What is there in what Vail is doing in your Lionshead renovation project that other areas can learn from?

What we’ve incorporated in both the Arrabelle development and Vail’s Front Door project is, we’re investing in skier services. And from the skier service standpoint we’re investing in both the public element and the “back of the house” for our employees. We’re building new locker rooms for ski school, lift ops, ticket scanners, and supervisors. For the first time, this is purpose-built space for our employees. Historically at areas, employees got some random space, and it was the third use for it. We were no different. Now, as a company, we’re making a commitment to the back of the house space for our employees and significantly improving our employees’ work environment. The reality is, 90 percent of their work environment is out on the mountain, and that’s great. But their first and last impression will be of a facility designed to meet their needs.

We’re also building new ticketing operations and interfaces, new rental shops, food and beverage, coffee shops. We have looked at the industry and taken everything we’ve learned over the last 10 to 20 years and incorporated that into these new facilities. It’s also the guest’s first and last impression of their experience. It’s my hope that these two new facilities raise the bar from the experiential standpoint for the guest to a new level they haven’t experienced before at most resorts.

In fairness, Aspen at Snowmass Village is doing the same thing. Copper Mountain focused on skier services in its new village as well. What we’re doing for our staff may be the little extra effort that makes a difference in our business for the next decade or two.

Earlier, while discussing diversity, you mentioned the importance of focusing on trial and retention. Is there a broader approach to retention that the industry can take, or that you’re going to take at Vail?

As I look at the industry’s business model, I’m optimistic that the next 5 to 10 years may be the best years ever. We have done an excellent job of retention with the Baby Boom generation. That has always been the question mark for the last 20 years. The record numbers we’ve seen can be attributed to Boomers not dropping out. Skiers and snowboarders and areas owe thanks to the equipment manufacturers for creating products that make it easier to ski better and have more fun.

Also, the industry in its own way connected with Gen X, via snowboarding and terrain parks and to a lesser extent with freeskiing.

And industrywide we’re seeing huge growth in our children’s programs. They literally are setting records across all resorts. The influx of kids has been a point of conversation at our conferences for the past few years. When you look inside our children’s programs, you wouldn’t have the impression that the U.S. has a childhood obesity problem. We have families who place a priority on active recreation. And that trend is also great for the ski industry.

There’s no doubt, though, that we had to take a look at the entry process for new skiers and snowboarders, as NSAA has done for the past six or seven years. Michael [Berry] was evangelical in talking to the industry; he made it part of his agenda. He made a significant difference in that we shared best practices. The quality of rental gear has come up. We have focused on how we were teaching beginners. But we have to ask, did we really move the needle?

In hindsight, I’d say that if we can increase retention by one or two or five percent, that’s successful. Does that meet the aspirations that the industry set seven or eight years ago? It probably falls a bit short. We thought we could raise retention by 10 percent. But so many areas have focused on it, and that retention increase hasn’t happened. Even so, if we move it just one or two percent, over the long term, that’s a real positive.

We have a glamorous sport, but it connects with some people, and doesn’t with others. I still remember the very first day I went skiing, and you just knew that this is who you were and this is what you wanted to do. We still have that same experiential reaction with our first-time skiers.

The best opportunity of retaining someone is to get them through three days of skiing and snowboarding with good equipment and instruction. Once you can ski down a run and share the experience with friends, you have that in common. That’s a key point in making the long-term connection to skiing or snowboarding.

A lot of areas have recognized that that third or fourth day is the tipping point. It’s something we push. We price our learn to ski/board packages so that you basically pay for the first day and the next two are free.

What else does the industry have to do in particular to improve the odds of fulfilling the potential you see for the next 5 to 10 years?

Travel and leisure is an extremely competitive market. As the world has become more complex, it’s also become more sophisticated. People have many more points of comparison than they did 10 or 20 years ago. We’re being judged on a much broader scale for that leisure/travel/entertainment dollar.

The expectations for the winter resort experience—about value, about the overall experience—are significantly higher than they were a generation ago. Weather was never an issue 25 years ago, but today, if a cloud passes in front of the sun for a minute, you’ll lose a skier visit because of it. People have become that finicky about their decisions.

What that means is we have to work that much harder every year to make sure that what we’re doing resonates with our customer. We really have an obligation, a responsibility, to make a connection with every customer. If we do that, we have a great chance of that customer choosing that experience again, whether it’s at our resort or another resort. In that sense, the industry is only as good as the customer’s last experience. We all share that responsibility of making sure that what we’re offering meets the guests’ expectations.

Two years from now what’s the one thing you’d like to have your term remembered for?

That the industry has an even stronger connection to our guest, both on an environmental and experiential level and from a safety perspective. We’ve done an exceptional job over the years of evolving and adapting to our guests’ expectations, but we continue to be focused on that, and at the end of the next two years, I hope we can say, “yep, we moved it up a notch.”

I have a saying here that I tell all our employees. We all multi-task every day. When we multi-task, most of the time we accomplish the job and that’s good enough. I only ask that, before you move onto the next task, stop for three seconds and ask, if I did 2 percent more, would it make a difference? If so, do it. If not, move on.

I think that lesson can be applied to a lot of things in life. If we think about how we operate our business and how we deliver that experience every day—if we all take that approach, it raises the bar to a different level.