November 1, 2009

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Looking For a Lift

Utah's Ski Industry Hopes to Hit Upward Slopes

By Heather Stewart

November 1, 2009

Ask how local ski resort officials are feeling about the upcoming season and the answer you’ll get from each and every one is that they’re cautiously optimistic. The 2008-09 season was a mixed bag with near record-setting snowfall, but fewer skier visits. Overall, skier visits were down 6.5 percent compared with the previous year. But, many in the industry agree that it could have been a lot worse. “Last year, the economy was spiraling out of control and no one knew where it was going to land,” says Nathan Rafferty, president of Ski Utah, a trade association that promotes Utah’s ski and snowboard industry. “We’re happy with where the visitation numbers ended up.” A Wild Ride To really understand the 2008-09 ski season, you have to look back even further to the previous year. That season, 2007-08, topped the charts with a record number of skier days: a grand total of 4.25 million winter enthusiasts hitting the slopes. The season capped out a five-year run of record-setting skier-visit numbers. So while the numbers were down last year, they were down from record highs. Even with a 6.5 percent decline in skier visits, last season still ranked fourth out of the past five years. “People still wanted to ski and snowboard, and they were going to get up to the mountains,” says Rafferty. The picture in Utah is a close reflection of the national situation. Nationally, skier visits were down last year from a record high of 60 million to a little more than 57 million—a drop of about 5.5 percent. According to Rafferty, the overall trend varied drastically among the country’s geographical regions. “We get a ton of our visitors from the Northeast, and the Northeast had a great year.” That region benefited from a bounteous and early snowfall, which along with the weak economy and high travel costs, kept residents of the Northeast close to home for their ski vacations. However, Rafferty says Utah did better than other Western states, particularly Colorado and California. Utah was blessed with abundant snow last year, with totals near 700 inches. The snow came late for many resorts, however, and most of them opened later in the season than normal. The fortunate exception was Snowbird Ski & Summer Resort, which actually opened on November 7, the second-earliest opening in its history. “We were pleased with the season overall last year,” says Jared Ishkanian of Snowbird. “We revised our expectations just before the season started because of what was happening in the economy.” A strong base of local skiers combined with its early opening helped tide the resort over through the rocky season. “The Little Cottonwood Canyon experience is unique,” says Ishkanian. “When you combine our snow with our terrain, it makes for a great experience, and our fans don’t want to give that up. For them, it’s not an expendable experience—they have to come and ski Snowbird every year, even if money is tight.” A Local Advantage Although Ishkanian says Snowbird saw plenty out-of-town visitors, the resort also relied on locals to fill in some of the gaps. “We have a fantastic local market from Salt Lake to draw from,” he says. Many resorts appealed to local skiers with discounts on season passes and early-bird specials. Snowbird dropped the prices for season passes last year and offered a new young adult discount and a family pack that was $500 cheaper than the previous year. Additionally, Snowbird gave coupon packs to guests at the resort’s lodgings, “to offer added value to the Snowbird experience,” says Ishkanian. Powder Mountain Winter Resort, located in the canyons above Ogden, offered similar discounts on season passes. The resort also found creative ways to draw in skiers and snowboarders—extending the night skiing hours, for example, and reducing the price of night skiing to 2002 levels. The overall strategy worked out well for Powder Mountain. “Although it was an average year, it was a good year,” says Gregg Greer, president and CEO of Powder Mountain. “We ended up having our second-best year in the history of the resort.” Greer credits loyal locals and hard-core ski enthusiasts for the resort’s good showing. Powder Mountain is something of a no-frills resort—it does not offer fine dining, spas or even lodging. But it does offer a great value and tremendous opportunities for adventure skiing. “If you come here, you come here to ski or snowboard,” says Greer. "Nine out of 10 of our visitors come to ski—and that’s not true for resorts that have more of the luxury amenities.” The resort boasts a variety of adventure experiences from heli-skiing to kite-skiing in the wilderness. “Powder Mountain lets you get your game on and go out and work and have a good time,” he says. Locals may have provided the backbone of last year’s ski season, but resorts also gained a boost from dedicated skiers visiting from across the country who refused to give up their annual ski vacations. “To go skiing is a want, not a need, to be sure—although some people would say it’s a need,” says Greer. Ripple Effects The number of skier visits only tells one side of the story. Spending goes along with skiing—equipment rentals and purchases, group and private lessons, lodging, dining, retail purchases and luxury spa experiences. And while skier visits may have slipped a little, the related spending slipped a lot. “Related resort spending was down a lot more than the 6.5 percent drop in skier visits,” says Rafferty. Resorts like Powder Mountain that focus solely on the ski experience saw less of a drop in visits and total spending than resorts that offer a complete lodging, dining and retail package. “The situation really varied by resort,” says Rafferty. “The resorts that cater to the local crowd still did really well.” This fact is well illustrated by the hotel occupancy rates, which showed a 12 percent decline in the first half of this year, according to the Utah Office of Tourism. Resorts may have held onto skier visits overall, but they saw a decline in the number of rooms booked. As Rafferty explains, many families chose to take shorter trips or to share rooms. And there have been fewer travelers flying into Utah. In the first quarter of this year—key months in the winter sports season—arrivals at the Salt Lake International Airport declined by 12 percent over the first quarter of 2008, according to reports from the Utah Office of Tourism. All of this had a measurable impact on Deer Valley Resort in Park City. “We were down 11 percent in skier visit last season,” says Erin Grady of Deer Valley Resort. This drop in visitors—nearly double the state average—translated directly into a drop in overall resort spending. “Some of our restaurants were totally booked for the entire year, but we had to run specials for some of our restaurants,” says Grady. Deer Valley doesn’t own the lodging units at its resort, so the resort was not able to track the effect of the recession on lodging. One noticeable trend was a lack of advanced bookings. Instead, families waited for cheap airline tickets and advantageous travel specials. “We had lots of last-minute bookings. We had people booking Christmas two days in advance,” Grady says. Despite the sluggish economy, Deer Valley decided not to run discounts on skiing and snowboarding passes—and it won’t be offering discounts this year either. “We’re definitely a destination resort,” says Grady. “We’ve been consistently ranked No. 1 by the readers of SKI magazine. So instead of running discounts, we’re taking the opportunity to solidify our brand and we hope to come out of the recession in a great position.” Let it Snow As for this year’s season, industry leaders are again, cautiously optimistic. “People are starting to open up their wallets a little bit more,” says Ishkanian of Snowbird. That resort decided to freeze its prices at last year’s levels. “We’re trying to be smart and strategic about our price points,” Ishkanian says. Indeed, the winners in this economy may be consumers who can take advantage of travel and lodging packages, as well as discounted pass rates. “It’s going to be a great year to ski because there will be values like you’ve never seen,” says Rafferty of Ski Utah. At Powder Mountain, Greer is hoping for another above-average snowfall. The resort has lowered its prices on passes for students, locals, seniors and those in the military. “Based upon last year, our skiers and boarders are very loyal, and so we hope to do as well or better than last year,” Greer says. “We’re cautiously optimistic, but there are still tough economic times.” And unfortunately, the rough economy has deflated the state’s budget for promoting tourism in Utah. With fewer marketing dollars to spend, the Utah Office of Tourism is sharpening and expanding its strategies. “This year, the mix is going to be a little different,” says Leigh von der Esch, managing director of the Office of Tourism. “Because we have seen that people are not booking in advance, we are actually waiting to go into the television market until January.” This delay may also have something to do with the office’s budget, which was cut by 37 percent for the current fiscal year. Because of the budget cut, the office has not produced new television ads, but will be re-running last year’s ads. The ads feature people costumed as snowflakes acting thrilled to have landed in Utah to be part of the Greatest Snow on Earth. “The ads were very well received. They had not saturated the market and are very eye catching,” says von der Esch. In addition to the television campaign, the office is turning to social media to help get the message out. The television spots are on YouTube, for example, and the message about Utah’s great snow is being spread through Twitter, Facebook and other social media. Individual cities, counties and marketing associations will also help spread the message through the Office of Tourism’s cooperative marketing program. Through this program, nonprofit marketing organizations, convention and visitors bureaus, and cities and counties can apply for Office of Tourism grants for marketing projects. The office can fund up to 50 percent of these projects, which must target out-of-state audiences for destination travel. Some of these projects include Internet and print advertising. For example, a print ad will run in this December’s issue of Sky magazine, a Delta Airlines publication. But funding for the cooperative marketing program was slashed this year as well. Last year, the program doled out $2.3 million in marketing dollars; this year, the total was $1.45 million. This means reductions for individual projects. Ski Utah, for instance, received a $250,000 grant in 2008, but only received $175,000 this year. Of the total $1.45 million in funding, about $600,000 will be used to promote winter tourism in Utah, according to von der Esch. Considering the recession and the across-the-board budget cuts faced by all government departments, Ski Utah’s Rafferty is grateful for the funding that is available. “We are really fortunate to have the cooperation of our Utah State government in promoting winter sports.” The best selling point for the state’s winter sports is, of course, Utah’s fabulous snow and varied terrain. “We get snow as high in quality as anywhere else in the country,” says Snowbird’s Ishkanian. And what could be better than great, powdery snow combined with enticing discounts and specials? “We know times are tough, but come up and ski with us and forget about it for a day,” says Greer at Powder Mountain.
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