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Season Passes - Impact on Ski Resorts

fatbob

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1. Not sure Vail makes their money on F&B like you say they that they do - Seems impossible since dining represents 8-9% of their on mountain revenue. Ticket sales (season and day) on the other hand represent 50-55% of on mountain revenue.

Not sure the numbers add up - what's the delta? Lessons? There isn't a lot of other stuff on the mountain to make revenue from. Seems the Lesson to F&B ratio would be very high while very few people take lessons but almost everyone eats or drinks something. Does rental and retail count as on mountain?
 
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LKLA

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Not sure the numbers add up - what's the delta? Lessons? There isn't a lot of other stuff on the mountain to make revenue from. Seems the Lesson to F&B ratio would be very high while very few people take lessons but almost everyone eats or drinks something. Does rental and retail count as on mountain?

Typically Vail gets 80% of their revenue from what is referred to as mountain operations, with the other 15% coming from lodging and less than 5% coming from real estate sales.

Of the 80% from mountain operations, approximately 50% comes from lift tickets (of which 50-55% comes from season pass holders), 18-20% comes from retail and rental sales, 10-12% from lessons, 8-10% from dining and the remaining 8-10% comes from other revenues streams.

While lift ticket revenues is basically evenly split between season pass and day tickets, the other half of the mountain revenue is not. It is heavily skewed towards day ticket skies. They seem to take more lessons, buy more stuff, rent equipment more often and spend more money on food.
 

TonyC

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The other benefit is that season pass sales are less weather dependent since they are pre-season. You could make the argument that they are just as weather dependent, just dependent on the previous season instead of the previous week's weather, but I think that is still less volatile.
The season pass seals have some sensitivity to the prior snow season, but far less than the day tickets do to the current snow season. Revenue consistency is a virtue in and of itself, particularly since many ski areas carry debt. You have to respect the downside of the non-symmetric distribution of skier visits. A great year may bump your visitation by 10% but a horrible year may cut it by a third, which you may not be able to afford with high debt service.
The average family on the Epic pass definitely does not make $55,000. I've met quite a few people (with kids) that buy the Epic pass for a ski week out west. It floors me, but I've met them. The average ski family vacationing out west income and the average US household income are quite different lol (different conversation though).
If 58% of all skier households make over $100K, I'll bet the percentage is much higher for the subset that live in the East but do any skiing in the West.

There is definitely some underutilization of advance purchased season passes. I have read anecdotally that completely unused passes can be in the 10% range of total passes sold. This offsets the hard core locals, well represented here, that ski 50+ days on their passes. The ski area is only looking at the total revenue and the average number of days skied per pass sold.

http://www.rrcassociates.com/wp-con...A-National-Demographic-article.compressed.pdf
is an interesting read and I may try to get my hands on a more recent full detail report. One point of note is that the ongoing aging out of Baby Boomers has finally reached the point that the average skier age in the US is no longer rising.
 
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Monique

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the average household income in the US is $55-60,000

The average ski family vacationing out west income and the average US household income are quite different lol (different conversation though).

+1 - exactly what I was going to post! The average US household isn't taking destination ski vacations.
 
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LKLA

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Fixed costs have zero to do with using a season pass 1 time or 100 times.



On the East Coast, most skiers are weekend warriors. There are certainly a large percentage of weekend warriors who are season pass holders. How are you classifying weekend warrior season pass holders? Are they increasing revenue or not increasing revenue?



58% of skiing households have income of $100k or more in 2014-2015. 18% of skiing households have income of $50k or less.
http://www.rrcassociates.com/wp-con...A-National-Demographic-article.compressed.pdf

Season pass holders use local lodging, pay for lockers, parking passes, and season long programs for themselves or their kids.

+1 - exactly what I was going to post! The average US household isn't taking destination ski vacations.

I was referring to an old pie chart of Vail's revenue streams that listed ticket and pass sales at 50%. Other forms of on mountain revenue were the other 50%. I can't find the image now though, but it was in an article talking about basically horizontal integration. Vail and other resorts that may try to take things from the Vail model want to get people to the resort to spend money on the other things at the resort. To do that they have to get people to the resort first. Cheaper season passes are the most effective at getting people to do that.

The other benefit is that season pass sales are less weather dependent since they are pre-season. You could make the argument that they are just as weather dependent, just dependent on the previous season instead of the previous week's weather, but I think that is still less volatile.

The average family on the Epic pass definitely does not make $55,000. I've met quite a few people (with kids) that buy the Epic pass for a ski week out west. It floors me, but I've met them. The average ski family vacationing out west income and the average US household income are quite different lol (different conversation though).

The point is that families do not just spend $2,500 without giving it some serious thought like you made it sound out to be the case. And for every family you say you know who does that I bet there are way more who do not. Even if you make $200K household income, very few people will buy season passes for their family without first really being as sure as they can be that they will indeed ski enough to make it economical.

Of course the national average household income does not equate to the average household income of a skier at Vail! No one is claiming that is the case. Though, it is interesting to see recent polls here on PugSki - one regarding season passes in which approximately 60% said they would ski less than half of the time if they were not able to buy a season pass, and another poll where over 60% of respondents said they spend less than $5,000 for their households on skiing for the season. So, just based on those two polls alone, spending $2,500 on season passes would be a big deal for most people and a big part of their ski budget - something they would not just buy and not use, at least not season after season.
 
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dlague

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The point is that families do not just spend $2,500 without giving it some serious thought like you made it sound out to be the case. And for every family you say you know who does that I bet there are way more who do not. Even if you make $200K household income, very few people will buy season passes for their family without first really being as sure as they can be that they will indeed ski enough to make it economical.

Of course the national average household income does not equate to the average household income of a skier at Vail! No one is claiming that is the case. Though, it is interesting to see recent polls here on PugSki - one regarding season passes in which approximately 60% said they would ski less than half of the time if they were not able to buy a season pass, and another poll where over 60% of respondents said they spend less than $5,000 for their households on skiing for the season. So, just based on those two polls alone, spending $2,500 on season passes would be a big deal for most people and big part of their budget.

The average number of days per skier is 6 which means there are lots of people that do not even ski enough to warrant a season pass.

Most season passes are designed so that 7-10 days and you break even. With the Epic Local Pass, break even is around 4-5 visits - no brainer - we got 35 days on the pass and 5 days off the pass! If a family skis a lot, I think a bigger reason for not buying a season pass is to not get stuck to one resort. We had passes to Cannon Mountain in NH and our whole family cost about $2000 at the peak for 5 of us we are now down to 3 and about $1900 for Epic Local. There are many economical pass products out there so I do not get the thought of not getting seasons passes. I used to deal hunt (tracking costs) and in the end spent just as much on lift tickets if not more - the difference was - the dollars are spread out.

Season pass holders use local lodging, pay for lockers, parking passes, and season long programs for themselves or their kids.

This an invalid generalization - I have been skiing for about 40 years, often the deal hunter, but the past 5 years I have been a Season Pass holder that "day trips", and with a multi resort pass do not have a locker, I do not pay for parking at Keystone, Breck, A Basin, Loveland and others (Vail and Beaver are exceptions), we as a family also do not do season long programs, we also bag our lunch and bring our beverages (adult variety too), but do eat at the resort from time to time where the restaurant is not owned by Vail. I work with lots of locals in CO that do the same.

When living back east, parking never cost anything, living in NH - we day tripped all the time to approximately 20 destinations and got 50 days in each season with 20-25 or so days on the pass. Many that I skied with in New England were not any different.

One final point most on this site are not average skiers and probably get way more than the average of 6 days in.
 

Bad Bob

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Areas will have different benefits and issues with different season pass buyers.

They LOVE seeing me buy passes. Bought my 2 season passes for 17-18 in March to get the deal (bought my 17 city golf pass about the same time). Left for a project May 1st and will be home again someday. Got 3 rounds on the golf pass and may not get any use off of the ski passes. Same was true for my last season pass, used it twice. If that is all I have to invest to be working on a longer project this long will do it every time.

Good news is the golf is good at the project location and the skiing looks to have real potential.
 
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LKLA

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The average number of days per skier is 6 which means there are lots of people that do not even ski enough to warrant a season pass.

Most season passes are designed so that 7-10 days and you break even. With the Epic Local Pass, break even is around 4-5 visits - no brainer - we got 35 days on the pass and 5 days off the pass! If a family skis a lot, I think a bigger reason for not buying a season pass is to not get stuck to one resort. We had passes to Cannon Mountain in NH and our whole family cost about $2000 at the peak for 5 of us we are now down to 3 and about $1900 for Epic Local. There are many economical pass products out there so I do not get the thought of not getting seasons passes. I used to deal hunt (tracking costs) and in the end spent just as much on lift tickets if not more - the difference was - the dollars are spread out.



This an invalid generalization - I have been skiing for about 40 years, often the deal hunter, but the past 5 years I have been a Season Pass holder that "day trips", and with a multi resort pass do not have a locker, I do not pay for parking at Keystone, Breck, A Basin, Loveland and others (Vail and Beaver are exceptions), we as a family also do not do season long programs, we also bag our lunch and bring our beverages (adult variety too), but do eat at the resort from time to time where the restaurant is not owned by Vail. I work with lots of locals in CO that do the same.

When living back east, parking never cost anything, living in NH - we day tripped all the time to approximately 20 destinations and got 50 days in each season with 20-25 or so days on the pass. Many that I skied with in New England were not any different.

One final point most on this site are not average skiers and probably get way more than the average of 6 days in.


Interesting.

This is what Vail says:

"For the 2016/2017 U.S. ski season, destination guests comprised 61% of our U.S. mountain resort skier visits, while local guests comprised 39% . Destination guests generally purchase our higher-priced lift ticket products and utilize more ancillary services such as ski school, dining and retail/rental,..."

Destinations guests are out-of-state and international guests and local guests are in-state and local.
 

Don in Morrison

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My break-even point is 5 days for my pass. For my 11-year-old granddaughter it is 3 days. I will probably end up with a total of 8-10 days for me and 5-10 for her.
 

fatbob

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Interesting.

This is what Vail says:

"For the 2016/2017 U.S. ski season, destination guests comprised 61% of our U.S. mountain resort skier visits, while local guests comprised 39% . Destination guests generally purchase our higher-priced lift ticket products and utilize more ancillary services such as ski school, dining and retail/rental,..."

Destinations guests are out-of-state and international guests and local guests are in-state and local.

Any international guest with any sense buys an epic pass these days if they plan their vacation before the cutoff. I bet payback on even the top unrestricted pass is less than 5 days over the holidays.
 
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LKLA

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Any international guest with any sense buys an epic pass these days if they plan their vacation before the cutoff. I bet payback on even the top unrestricted pass is less than 5 days over the holidays.

You may think that - and I would agree with you - but the facts, Vail Resorts, say otherwise. Most people - international guests - who fly to Vail Resort properties do NOT buy season passes.
 

DanoT

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You may think that - and I would agree with you - but the facts, Vail Resorts, say otherwise. Most people - international guests - who fly to Vail Resort properties do NOT buy season passes.

Don't forget that a super high day ticket price also allows for it to be deeply discounted. Up to 40% off if purchased far enough in advance through Liftopia.

Or discounted tickets for a Ski & Stay package wherein the resort sells day tickets at a wholesale price to hotels and lodges. So that $200/night room is now "only" $250 with a "normally" $150 lift ticket included.

The title of this thread should perhaps be "High Priced Day Tickets-Impact on Ski Resorts".
 

x10003q

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This an invalid generalization - I have been skiing for about 40 years, often the deal hunter, but the past 5 years I have been a Season Pass holder that "day trips", and with a multi resort pass do not have a locker, I do not pay for parking at Keystone, Breck, A Basin, Loveland and others (Vail and Beaver are exceptions), we as a family also do not do season long programs, we also bag our lunch and bring our beverages (adult variety too), but do eat at the resort from time to time where the restaurant is not owned by Vail. I work with lots of locals in CO that do the same.

Using your example of 1 plus the maybe 50 people you know to indicate the following statement is invalid is ridiculous.
"Season pass holders use local lodging, pay for lockers, parking passes, and season long programs for themselves or their kids."

I never said ALL season pass holders. Why do ski areas offer these seasonal items if nobody was purchasing these items? I do not think there are any day pass or limited visit, multi mountain pass holders purchasing seasonal lockers, seasonal parking passes and/or seasonal ski programs at a single area. That would indicate that season pass holders are purchasing these seasonal products.

Maybe Vail should close up their restaurants because you and and the handful of locals you work with do not eat at Vail restaurants. Maybe not.

When living back east, parking never cost anything, living in NH - we day tripped all the time to approximately 20 destinations and got 50 days in each season with 20-25 or so days on the pass. Many that I skied with in New England were not any different.

Of course you day tripped all the time, you lived in New Hampshire.:doh:

Last time I checked, skiers live in other states that, due to geography, require hours of driving to enjoy the same decent skiing you day tripped to when you lived in New Hampshire. Many times these skiers rent or purchase overnight lodging. At one ski area. For the season.

Once again, your super small sample size does not define all skiers.
 

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