Those were the predictions of some of the industry’s respected visionaries— resort managers, developers and designers—who spoke at a conference at Vail, Colo., in May. Attended by more than 150 ski area executives and consultants, the conference, titled “Developing, Marketing and Managing Destination Resorts,” was produced in the United States by Canada Forum Inc. of Toronto.
Among the high-powered speakers at the two-day resort development program were George Gillett, Jr., chairman of Booth Creek, Inc.; Bill Jensen, senior vice president and COO of Breckenridge; Jerry Blann, president of Jackson Hole; and Bruce W. Mainzer, senior vice president for marketing at Vail Resorts.
In his comments, Jensen drew a hushed response from the audience with his assertion that the public regards skiing as neither a sport nor a recreation but, in the 1990s, as a form of entertainment. “With people spending less and less time on the slopes—an average of three hours per day—skiing can no longer be considered a lifestyle, but merely a diversion,” he said. The era of the hard-core skier is gone and, in today’s mobile society, “people are less likely to be committed to anything.”
In terms of generating revenue, resorts need to concentrate more on aprés-ski activities and not just shopping and dining, Jensen said. Vail’s Adventure Ridge, a nighttime cornucopia of tubing, sledding and other non-skiing winter escapes, has established the appeal of mountain theme parks, said Jensen. In connection with this trend, he predicted an “explosive growth in children’s programs” and urged ski areas to invest quickly in this. “Baby boomers have no limit on how much money they will spend on their kids,” he said.
What will bring visitors back to a resort, said Jensen, is “an enduring sense of place,” a reference to villages and towns that have character and diversity. As part of that attraction, resorts must revitalize their bed base through renovation and new construction, he said, or they will lose business. “There are going to be some major changes in the rental market in the next two to three years,” he said.
The ski industry, typically dominated by masculine perspectives, might need to soften its image, said another speaker, Becky Zimmermann, who is a principal with Design Workshop of Denver. “Women today are increasingly making vacation decisions and this will continue to be true in the future,” she said. A 1997 survey by Marriott found that women chose the location of the family vacation 62 percent of the time, and a 1996-97 National Skier/Boarder Opinion Survey showed that 72 percent of women at ski resorts were there with their children, up from 61.7 percent three years earlier. Further, she said, the number of women who go backpacking, traditionally a male pastime, now exceeds the number of men who backpack. The inference from these statistics is that women will be more influential and as active as men and resorts should be aware of this when planning programs and facilities.
Market segments that have been virtually ignored, she said, are ethnic groups. “By the year 2010, Caucasians will be in the minority in the United States. The next generation of resorts must identify opportunities to attract Asian Americans, Black Americans and Hispanic Americans,” said Zimmermann. She cited a 1996 survey by the Travel Industry Association of America that said the three largest minority groups have the willingness and discretionary income to travel, but are often overlooked by resort marketers.
She encouraged ski areas to reinvent themselves as multidimensional destinations. “Successful resorts will understand the fantasy of the resort experience and the interplay of the natural environment, history, regional culture, architecture, art, food, recreation, leisure, housekeeping, romance and group and family experience,” said Zimmermann. “People go to resorts to recreate something that is missing from their lives.”
They may also go to resorts for retirement, in the view of Chris Cares, principal with RRC Associates of Boulder, Colo. Cares, who has been involved in surveys for Colorado Ski Country and NSAA, said statistics clearly indicate that Baby Boomers are eyeing the mountains for their twilight years. In one study at Vail, 58 percent of property owners said they intend to occupy their homes and condos for longer periods of time. Among absentee owners, 25 percent said they expect to make Vail their primary residence in five to ten years, as a “preretirement or retirement” strategy.
The implications of these trends are that there will be fewer rental units available to the public, more people of retirement age living in ski resort communities, and a continued demand among Baby Boomers for scarce mountain real estate. The downside for ski resorts, said Cares, is that Boomers at or near retirement age are more likely to pursue leisure activities that are less rigorous than skiing.
Another trend touched on was the increasing use of the Internet as a marketing and sales tool. Jerry Blann of Jackson Hole said his surveys show that 82 percent of visitors this year checked out the area’s Website before arriving. That was up from 60 percent the year before and 15 percent the year before that.
Bruce Mainzer said that at Vail Resorts the number of Internet requests for information now far exceeds inquiries from other sources. In what may be the most detailed analysis put forth thus far by any major ski resort, Vail properties last season received 40,459 inquiries through the Web, which led to the booking of 4,650 room nights—a conversion rate of 19 percent. That is now roughly equal to the conversion rate achieved through the travel trade (20.6 percent) and fulfillment programs (21.4 percent). The next highest source for requests was at 25,457.
Vail is so convinced that Internet sales will dominate in the coming years that the company is devoting more financial resources to its Websites. In fiscal year 1998, five percent of VR’s total marketing budget, which exceeded $20 million, went to the Internet, said Mainzer.
Gillett, who drew laughter when he said that his wife tells him, “I am wrong most of the time, but I’m never uncertain,” made some veiled jabs at competing companies. “We think that it is a mistake to homogenize resorts,” he said, without elaborating. Both American Skiing Company and Intrawest, are pursuing visions of mountain villages and hotels based on established formulas.
Booth Creek, said Gillett, intends to spend a year consolidating its recent ski area acquisitions, but if the right deal comes along for a major destination resort, “we have the resources to acquire it.” Sometimes portrayed as being highly leveraged, and thus vulnerable financially, Gillett said his company is on sound footing. Booth Creek, he said, made $28 million in earnings for the 1997-98 season and “we don’t owe a cent of principal for 10 years.”
