Monday, September 28, 2009
Steamboat Springs Steamboat Resorts wasn't ready to wait to see how this winter turned out for lodging, President Bob Milne said at a Business Outlook Breakfast last week. So the company put itself out there.
To increase visibility, the property management company offered 50 percent discounts to returning customers. Steamboat Resorts gave people a month to book and split the discounted rooms equally among December, January, February and March, Milne said.
"None of us really knew what to expect," Milne said. "I thought maybe it was a little aggressive."
The company offered the discount at resorts in Steamboat Springs, Vail and Beaver Creek.
"What happened was the phones went crazy," Milne said. "They went crazy. We had our busiest reservation day in the history of our company, 888 phone calls."
Steamboat Resorts finished down about 25 percent for the 2008-09 ski season, he said. Its Vail properties were 12 percent down, and Beaver Creek took a hit to the tune of 40 percent. The discounting was part of an attempt to turn things around.
Milne told Steamboat Resorts' story Thursday as part of the Steamboat Springs Chamber Resort Association's breakfast. The Chamber started the breakfasts to provide perspectives to the business community on the state of the real estate, skiing, banking, lodging and building industries. Another is planned for early December.
Milne said his company succeeded in generating business. People who couldn't get the 50 percent off deal instead asked what deals they could snag.
"We're actually booking on a daily basis," Milne said. "We're booking 10 to 15 percent more a day than we did last year. It doesn't get us back to the volume of the year before, but it is encouraging."
The bargain hunting does mean that people will spend less on lodging, said Chris Diamond, Steamboat Ski and Resort Corp. president. The average daily rate is likely to still be lower than it was in solid economic times.
After last season's challenges, lodging companies are faster to drop prices, Diamond said.
"Last year, we were looking at some pretty firm pricing, and everybody wants to hold on as long as they can until they drop their shorts, so to speak," he said.
Steamboat Central Reservations sent out an e-mail last week advertising 25 percent off lifts and lodging for people who book by Oct. 8. That deal is restricted during busy times, however, offering 15 percent off during the post-Christmas week and 10 percent off during Presidents' Day week.
Milne said Steamboat Resorts was employing other strategies to draw customers. The company increased its marketing budget 10 percent, he said, and is sending sales teams to Dallas and other cities to market Steamboat.
"Our attitude is let's go out and create the demand and worry about raising yield next year when we get the demand back," he said.
Milne and other speakers reminded businesses that now was the time to focus on service. Steamboat must provide top-notch service to keep visitors happy so they'll want to return.
Also, Diamond and Milne said, good economic news doesn't mean it's time to open the floodgates and start handing out bags of cash. Business owners should continue to watch their pennies, Diamond said.
Milne offered a similar suggestion.
"I think we need to prepare and run our businesses like last year, and if it's better, great - crack the champagne."