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January 2011

In the Fast Lane

Tubing continues to grow in popularity, both with customers and resorts looking to expand their revenue streams.
Written by Peter Oliver | 0 comment

Tubing, the low-skill relative of skiing and snowboarding, has quietly continued to grow over the past decade. Not only does the number of tubing areas nationally appear to be increasing, but ski areas with existing tubing operations tend to be expanding and upgrading. And the number of tubers appears to be rising, too. In a difficult economy, tubing has been easy money for clever and well-positioned resorts.

The beauty of tubing is that it brings non-skiers into the winter sports mix, and the potential audience expands exponentially. Yet tubing isn't necessarily a smart choice for every ski area. What makes sense at one area might be ineffective or even counterproductive elsewhere.

SLIDING INTO PROFITS

With its low skill requirement, relatively low costs, and growing popularity, tubing can add a substantial punch to a ski area's bottom line. That's why 44 percent of Midwestern areas offer some kind of tubing, according to NSAA figures.

And the profit motive applies outside the Midwest as well. Ben Wilcox, president and GM at Cranmore in North Conway, N.H., says that tubing now represents about 10 percent of the ski area's total revenues, but that the gross profit margin is between 75 and 80 percent, or about three times the figure for many other operations. "It provides a much better return," says Wilcox, pointing to relatively low operational costs. "We operate on small acreage, and just two weeks of snowmaking can pretty much get us through the season. With the ski area, there is a much bigger and more expensive infrastructure."

Jim Engel, VP at Sunburst Ski Area, Wisc., calls tubing "a profit center that is a valuable part of our operation," and Steve Showalter, general manager at Massanutten in Virginia, reports that the roughly 64,000 tubers Massanutten hosted last winter represented approximately a 30 percent increase in the six years he has been working at the resort.


BEST PRACTICES

As the tubing industry has matured, the operational logistics have come a long way, especially in making the activity safer and more user-friendly. Although Showalter concedes that "liability is still a big concern," successful tubing operators have added meaningful safety measures over the years to reduce the risks of injury. (See "Reining in Risk" page 46.)

Also key to customer satisfaction as well as safety is keeping numbers manageable. As at many areas, Showalter says Massanutten divides the tubing day into two-hour sessions (six per 12-hour day, in Massanutten's case). The area caps sales at 200 tubers per session on its 14 lanes.

Sheer manpower is perhaps the most important safety and customer satisfaction component. Labor is usually the heftiest single budget line, but successful tubing operators agree that it is an essential investment-and inexpensive, considering the profits that flow from tubing. Engel, with a 20-lane tubing hill, says that one employee per lane at the start, and one for every two lanes in the run-out area, keeps the traffic flow organized, timely, and safe.

One relatively inexpensive technological innovation is Reliable Racing's Tube Sentry, a red/green stoplight device that uses electronic beams, like those on a race timing system, to change the lights and signal when a lane is, or is not, clear for the next slider. Engel began using the lights last year at Sunburst, and has been pleased with the results.

Some of the industry's best practices have evolved at resorts that have located their tubing lanes offsite, and have created stand-alone operations. Among those is Gorgoza Park, which was opened in 2000 by Park City Mountain Resort at a spot eight miles from the ski area. It has its own management team, headed by snowtubing manager Tom Butz, who has been with the tubing park since its inception. He has created a culture that emphasizes responsibility and dedication.

"That consistency from an operational management standpoint has been a special and significant factor in how Gorgoza has been able to set the standard for both safety and the guest experience," says skiing services director Tom Pettigrew. The park has seven lanes, two rope tows, and this year, a conveyor lift that replaces a third rope tow. There are short lanes of 500 feet and long lanes of 1,000 feet, all of them straight, fall-line plunges. "We've learned that curves require too much maintenance because they set up a bobsled-type of situation," says Butz. "So we put in some gentle rollers." Gorgoza requires between 13 and 22 staffers per day, and operates both day and evening hours.

It also manages adjacent attractions that include snowmobile rides for kids. In a good season, the park can attract 75,000 attendees, Pettigrew says.

The expansion of tubing from standalone activity to one of several winter adventure activites could become the next big trend. Sierra-at-Tahoe this year is planning to move its two-lane tubing operation from the ski hill in front of the day lodge to a separate, stand-alone location, Blizzard Mountain, that will create a sort of mini theme park, with music, costumed characters and food services.

Ski area general manager John Rice says the tubing hill has its own supervisor and is meticulous in observing safety protocols. "We test the lanes by putting 100- or 150-pound sandbags in the tubes the first thing in the morning," he says. "That helps us find the appropriate starting point."

Rice says that having the tubing hill allows the area to promote skiing and snowboarding to the snowplay audience, with incentives such as vouchers for discounts on ski and boarding lessons. "Upselling the other things that we offer is a great way to recruit newcomers," he says. "We see tubing as a way to expand the portal to our mountain."

WHO ARE THE CUSTOMERS?

An area's location and market can determine whether tubing will be a success. Tubing has a different appeal to each of four distinct populations: non-skiers, day skiers, weekend skiers, and vacationing skiers.

That tubing is especially popular for the smaller hills of the Midwest makes sense. The areas often have large populations of non-skiers and non-riders nearby, and are an easy day trip. For these guests, tubing is an easy thrill.

In some scenarios elsewhere, a tubing operation can draw effectively on all four possible audiences. The town of Frisco, Colo., centrally located among several major Colorado resorts, is constructing a tubing hill for this winter as part of a six-million-dollar municipal-park project. As project manager Rick Higgins puts it, "we are right in the heart and soul of ski country," meaning that the town expects to draw from a combination of destination skiers, day-trippers and weekenders from Front Range cities, and local families. Although nearby Copper Mountain and Keystone also offer tubing, Frisco expects that there are plenty of potential customers to keep all three busy and financially viable.

At areas that rely primarily on overnight visitors, however, tubing-only customers might displace skiers and snowboarders. That can be a concern in resorts where the number of paying visitors is capped by the number of beds. Tubing customers typically spend less than skiers, who buy not only a more expensive lift pass but also spend on lessons, rentals, retail products, and other services. A tuber in a skier's bed can negatively impact the overall revenue stream.

And perhaps not. Showalter points out that for weekenders visiting Massanutten, the availability of tubing can help increase the overnight numbers of skiers as well. A family of skiers and non-skiers may not be able to mobilize for a weekend visit unless there's something for the non-skiers to do, and tubing can be part of the package. (The area also has a sizable indoor water park and fitness center, among other draws.) And, Showalter adds, sometimes just getting non-skiers to the area (through a supplemental activity like tubing) can lead to the conversion of new skiers. That's a net gain.

In some cases, tubing operations can benefit from other, nearby attractions. Wilcox says that Cranmore, basically a weekend area with a day-skier base, benefits from North Conway's draw as a regional sport and shopping destination. Shopping at local outlets helps draw people into the area. Tubing supplements their visits as a secondary activity. The area's strategy is to reach out to these visitors, rather than to try and build a unique customer base.

The least likely customers? Those hardcore skiers who commit their energy to a full day on the slopes, and for whom tubing holds no special thrills. Still, some destination areas have found tubing to offer nighttime activity for hyperactive kids, and that makes it appealing even for some vacation resorts.

In the end, the beauty of tubing is that it broadens the market for winter sports. Anyone can do it; no special athleticism is required. From pipsqueak to grandma, the whole family can join in. And if you can expand your market in a tough economy, that's saying something.



Ken Castle also contributed to this report.