It’s been a while since I’ve posted! I was looking back through some of my old school files and came across this paper I wrote over two years ago. Check it out!
Since the creation of the ski industry as we know it back in the 1940’s, the three keys to the industry have been snow, snow, and snow. Global climate change has been rapidly changing the ski industry directly and indirectly over the years with the most significant impact being the variable and shorter ski seasons. The ski industry has had to adapt to significant variances in snowfall from season to season and has required the industry to look at how they operate. (EPA, 2013)Extensive snowmaking operations have supplemented natural snow and can make or break a season or an entire resort. Continual warming trends dictate that the industry explores further options to diversify their product in order to reduce the risk of a poor snow season significantly compromising the finances of a ski area.
What is happening?
The winters are getting warmer, and they are getting shorter. Global climate change has altered the winter season as temperatures rise and there is no obvious slowing in this trend. The industry is taking a hard look and has decided that they can no longer operate as a seasonal tourism enterprise, but rather must adopt a year round destination strategy. The year round strategy with a variety of tourism opportunities can make up for poor snowfall seasons. The graph above clearly shows the warming trend that is occurring. This warming trend starts around the 1900 mark when many of the “developed” countries started to go through industrialization on a large scale and has continued as more countries develop, produce and consume more resources. (EPA, 2013)
How is the Ski industry reacting?
Luckily, many ski areas have significant infrastructure already in place to make the transition from a seasonal ski resort to a year-round tourism destination. Although the resort may be primarily used in the winter, the large investment made in transportation, food services, trails, hospitality, and roads exists already and can be leveraged to experiment with summer and fall activities. The trails are there, the buildings exist, accessibility is easier, and becoming a year round destination retains key employees. The incremental costs are minimal and income for the summer activities will more than offset these variable costs. All additional profit after variable costs can be put towards shortfalls in winter revenues and the large fixed infrastructure costs of a ski resort.
Industry wide, there are many different approaches to creating new experiences and opportunities to reduce seasonality issues on the ski areas. I have compiled a list to discuss the most popular and profitable opportunities that can be implemented to a ski area with limited additions to their current infrastructure.
- Special Events/Festivals
- Mountain Biking
- Challenge Courses
- Water Parks
Several communities have done an outstanding job of working with their local community to create special events and festivals. If we focus primarily on the Aspen / Snowmass area as an example, they have worked well with the Aspen community to provide a full host of summer events through the city and the resort. Several large festivals that are hosted by the city are very well attended. The Food and Wine Classic in Aspen occurs in late June (Aspen Chamber of Commerce). They bring in culinary experts to provide food and some of their chefs include Mario Batali, Bobby Flay and Jacques Pepin. The event also includes 300 Vintners who pour premium wines during the three day event. The mountain and town come together for an annual 4th of July Celebration that includes the traditional parade coupled with live music, a carnival and picnics, and fireworks over Aspen Mountain. A two day Aspen Arts Festival in late July brings in life-size sculptures along with other art medium for purchase and enjoyment(Aspen Chamber of Commerce).
The JAS June Festival, a ten day event, provides four nights of concerts as well as 10 days of free jazz concerts in the Aspen valley (Stayaspen). These concerts work well with Snowmass Mountain that provides free outdoor concerts every Thursday night on Snowmass Mountain during the summer. Aspen Mountain follows that up with Classical Music for free on Saturdays during the summer as well as Bluegrass music on Sunday afternoons. All of these music events have food and beverage service and the Aspen events require a gondola ride to the top. The summer is topped off with a Labor Day weekend Jazz AspenSnowmass concert series on Snowmass Mountain. The line up of bands is strong and meant to bring in people from around the area (jazzaspensnowmass.org).
A fairly new addition to the lineup is the addition of the USA Pro Cycling Challenge at the end of August. Lance Armstrong joined the community in Aspen a few years ago and started this rigorous event that allows professional and novice alike to participate in a multi city circuit course. This seven day event begins in Aspen and will continue to Crested Butte and then on to Gunnison – Monarch Mountain before going through Colorado Springs and then onto – Breckenridge with a stop into Vail before ending in Denver. This is a great example of bringing several ski resorts together to host a popular event that provides food and hotel revenues, but also provides strong PR opportunities that introduce more people to the resorts. (US Pro Cycling).
The mountain provides the traditional summer activities that all resorts offer such as Mountain Biking at Snowmass and Aspen Mountains. Bike rentals are available as well as private biking adventures and group downhill clinics. If cycling is too rough, there are extensive hiking trails serviced by the Gondolas (at a fee). Camp Aspen/Snowmass is offered for children to develop outdoor skills and camping. The other outdoor and indoor opportunities include disc golf, a climbing wall and Eurobungy, a paintball course, outdoor yoga, horseback riding and fishing adventures.
Do the special events bring in new revenue? Certainly these events bring in new tourists and money is brought into the market. Having spoken with management from The Hilton on Prospect in Professor Kang’s class, special events are always worth the investment for them. The increased revenue from additional guest stays and from the restaurant far out weight the cost of booking these groups. In many resort ski areas, there are significantly more accommodations than at The Hilton Fort Collins and these accommodations are primarily used in the winter season. The infrastructure exists so the resorts should capitalize on what they have.
Who should be reached?
What is the point of diversifying and creating these new opportunities if no one will participate? Creating an experience that consumers do not want is financially irresponsible and negatively impacts the environment. Let’s look at groups who can be targeted to participate in these opportunities.
The first are special events and conference groups. These groups are large meaning that they will have more impact than going after families and couples. Working with these groups have big returns and positively impacts the resorts in terms of accommodations, food and beverage, mountain owned stores, and summer activities. These groups are also beneficially for the local community adding direct and indirect benefits of the increased spending.
Families, while smaller in size, should not be disregarded. Building relationships with families in the offseason is a great way to stay current in their lives which hopefully impacts their decision to return to the ski area in the winter season. Aspen has done a great job with my family. The company has built brand loyalty with my family, and we go to Aspen twice a year. Through this connection, and the upgrades that we receive, we reward them by bringing friends and family to the resort and town that otherwise would not have come.
Outdoor enthusiasts are a group that I believe should be targeted as well. Ski areas exist in mountainous regions. The industry should use this to their advantage. The mountains provide a variety of outdoor recreation opportunities such as hiking, fishing, paragliding, trail running, mountain biking, and challenge courses. With visitation in Colorado highest during the summer, it makes sense to use what you have as a ski area.
Why should the ski industry attract these demographics?
As Mike Barry discussed in class, introduction and conversion to the sport of skiing has remained stagnant. Without growth in introduction and conversion rates, the ski industry will start to shrink as people start to leave the sport of physical reasons. As part of this, fewer people are participating in snowboard, and rather than seeing an increase in skiing, there has been little impact.
Reaching out to these groups in the offseason and providing them with incentives to return during the winter, would assist with improving introduction and conversion. Getting people on the mountain will be essential to bringing in new people. Training employees to cross promote opposite seasons from the current one would be a great way to reach people who are already on the property fairly cheaply.
The climate is changing, and in most mountainous regions, the winters are getting warmer and shorter. For ski areas, this spells disaster if they continue as a seasonal destination. Becoming a year round destination with activities and experiences throughout the year would alleviate the pressures of being a seasonal destination centered on snow. Diversifying the product offering to include expanded event and conference availability, as well as positioning the ski area around attracting families and outdoor enthusiasts are obvious target markets.