Ski officials optimistic about upcoming season
September 13, 2003
Steamboat Springs — Steamboat’s No. 1 crop made an early appearance this week, raising expectations for an abundant harvest. But there’s more to winter tourism than a surfeit of powder.
“We’re snow farmers,” Steamboat Chamber President Ulrich Salzgeber said. “But we count on so many different things.”
Steamboat enjoyed a good crop during the winter of 2002-2003, but it wasn’t enough to ensure a robust resort season.
“Our business did not have a great winter and I’m not expecting anything over last year. I don’t think anybody on the mountain is,” Chamber board member Bill Stuart said of the prospects for the coming ski season.”
Stuart operates a specialty grocery and liquor store at the corner of Apres Ski Way and Village Drive, in the heart of condo alley. He said Steamboat’s visitors last winter were careful in their spending habits.
Andy Wirth, Steamboat Ski and Resort Corp.’s vice president of marketing, has a more optimistic message and he intends to devote more energy in the months leading up to the ski season to sharing information with other business owners in Steamboat.
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“We just dropped a large direct -mail campaign and the marketplace is responding,” Wirth said.
The “Early Escape Package” offers “exclusive” discounts to ski vacationers who are willing to pay for their vacation in full at the time of booking rather than in installments. Wirth said the fact that skiers are responding to the campaign is encouraging. Last winter, there seemed to be little Ski Corp. could do to motivate ski vacationers in the big ski months of February and March.
“There are factors that are clearly evident to us now that were not necessarily evident to us while we were in the months of February and March,” With said. “The overall travel fears leading into the period had a significant portion of Americans staying home.”
Essentially, Americans were extremely reluctant to travel during the buildup to the war in Iraq, Wirth said. Ironically, as soon as the United States went to war, people resumed more normal travel patterns.
Wirth is keeping a close watch on the “consumer confidence index.” The index, maintained by the Conference Board, shows consumer confidence during February and March of 2003 was the lowest it has been at any time in the last three years, Wirth said. The number assigned to consumer confidence in March was a 61, Wirth said. In contrast, consumer confidence was higher, at 85, in October 2001, one month after the terrorist attacks on the World Trade Center.
Wirth is intent on tracking the consumer confidence index because research shows that number correlates closely with what he calls “inbound demand.” That’s trade talk for the number of people expressing interest in a winter vacation in Steamboat Springs.
“We want to get away from headlines and look at empirical stuff,” Wirth said. “Today the consumer confidence index is in the mid-80s. We know that when it’s in the 90s and above, it creates great opportunity for us.”
Wirth’s job is to attract skiers to the resort. Stuart’s is to get them to spend money once they are here. The spending habits of skiers on vacation have everything to do with how successful different businesses perceive the winter to be.
The experience of last winter will lead Stuart to continue to stock good wines in his store, but at a lower price point. He has the good fortune, he said, to be able adjust his buying decisions on a weekly basis. In contrast, merchants in the ski accessory business must order all of their ski gloves, for example, for the entire season, then hope for the best, he said.
Salzgeber, who manages Alpine Taxi, said his business is receiving many inquiries from people planning to vacation here this winter. However, it’s too early to begin tracking reservations.
He said last winter’s visitors kept their spending impulses in check.
“People were definitely watching the bank last year, especially during February and March,” Salzgeber said.
From conversations with property managers, Salzgeber has concluded that families, who may have rented spacious condominiums with kitchens in previous winters, may have all squeezed into a single motel room last winter. At first glance, that should mean good news for restaurants. Salzgeber said that wasn’t necessarily the case. Even lacking a kitchen, families had the option of ordering pizza and salads in their hotel rooms, he pointed out.
Another trend that represents a mixed blessing for Steamboat businesses is the continued movement toward shorter ski vacations.
Property managers view shorter stays as a detriment because their housekeeping staff must turn the rooms over more frequently, resulting in higher labor costs. Retailers selling ski gloves and goggles could view shorter visits as a chance to sell twice the merchandise to new arrivals. But that presumes that all of the guest lodgings are full throughout the week.
Too often last winter, the resort was quiet on Tuesdays, Wednesdays and Thursdays, Stuart said.
Wirth offered optimistic news about early airline bookings. The long-standing direct flight from Minneapolis on Northwest Airlines is showing the strongest interest ever, he said. And the new Saturday flight from Atlanta on Delta Airlines is already approaching a 50 percent load factor for the entire season. Wirth predicted that kind of early reservations pace could translate into an 80 percent load factor for the season.
Already, Wirth said there are signs that Steamboat’s competitors will be quicker to discount their product than ever before.
“It’s the earliest start I’ve ever seen, and the level of price discounting is nothing short of remarkable,” Wirth said.
This is the time of year that ski resorts typically roll out campaigns and watch to see how consumers respond, Wirth said. However, Beaver Creek is already offering a two-for-one promotion. And Crested Butte is offering steep discounts over the holiday break.
Steamboat is using a new piece of database software to aid in its efforts to fine tune its direct marketing to potential clients as well as its captive list of skiers who have vacationed here before.
The “Prevision” software being used by all of American Skiing Co.’s resorts, including Steamboat, allows the resorts to store “key pieces of information about customers” Wirth said.
That allows resort marketers to quickly respond to changing economic conditions with new campaigns.
For example, as soon as customers purchase season passes at ASC’s eastern resorts like Killington, Vt., Steamboat executives will be able to evaluate the likelihood that they would take a Western ski vacation and pitch them with a package rate for a trip to Steamboat.
Wirth is optimistic some of those ASC customers will want to experience Steamboat, which was just ranked fifth among all North American ski resorts by readers of SKI magazine this month.
The question for local business owners may be, “If they come, will they spend?”