“Airports and Mountain Resorts” by Jeff Harbough via JH&A Market Watch Blog

“Airports and Mountain Resorts” by Jeff Harbough via JH&A Market Watch Blog

Seattle’s main airport is surrounded by communities and has grown like a weed right along with the Seattle metropolitan area.  It has no practical way to expand.  Through recent technology and some clever evolution of facilities the airport authority is doing everything it can to shoehorn more passengers and flights into the same space.  But there’s a limit.  Airplanes, which are big and fast moving, need a certain minimum vertical and horizontal separation no matter how sophisticated the technology of the plane and control systems are.  They also need to park and move around while they are on the ground.

The same is true of skiers and snowboarders at mountain resorts in case you hadn’t figured out where I was going with this.

It’s unlikely many new winter resorts are going to open.  Climate change, at least for the immediate future, will mean an overall decline in snow days and season length (yes, I know- good for some mountains, bad for others).  Here’s an interesting article on how conditions are evolving in Norway.

Like with airports, technology in the form of snow making, faster lifts, etc. will try to ameliorate this where possible.  And mountain resorts will increasingly try to build their year around business.

It might be ten years ago I first suggested the National Ski Areas Association change its name to the National Mountain Resort Association.  Still waiting, though the case is even stronger now.  I’m wondering if resorts, or I suppose resort groups as things have evolved, will offer not just multi resort but multi season passes.  Consider the permutations of passes you could sell- not just days on the slopes but rounds of golf (my favorite), mountain biking, hiking, zip lines.  The potential list is long.  God, I love year around cash flow.

Back to skiers and snowboarders.  As things evolved during covid, we’ve had growing winter visits to resorts.  Is this a permanent, long-term trend?  No idea. But mountains have been reacting to the upsurge in many ways.  Among these are parking reservations, limits on how many lift tickets they will sell, restricting walk up purchases, further emphasis on various length multiday passes, facility upgrades, better use of improved information systems and higher prices.  Crystal Mountain here in Washington where I live is undertaking a program to improve facilities, and better manage and accommodate increasing visits.  Part of how they are paying for it involves a sizable increase in their season pass price.  Here- read this article for a complete description.

In case you haven’t noticed it, resorts are not be the only businesses raising prices as demand increased, costs rose, and supply declined.  But in the same way you can only get so many aircraft in a given volume of air space you can only get so many snow sliders on a mountain at a time if the experience is to be the one they expect, or at least will tolerate.  Airports, I suppose, are better off than mountain resorts.  Sometimes you have to take a plane.  You never have to snow slide.

Season passes, and indeed passes of all length down to a couple of days, are an important way mountains are managing demand.  And they are great for cash flow, as I may have said a few times over the years (and only twice in this article).  I won’t be completely surprised if last minute at the mountain lift tickets go away or become so expensive that hardly anybody buys them.

As in all retail, systems are getting better and managers are being dragged, often kicking and screaming, into using them.  The algorisms are surfacing useful data nobody had thought of or even imagined having.  Even given the variability of snow (offset by snowmaking capabilities?) season pass sales and past use, parking reservations, maybe when passes are bought, and other factors, are improving forecasting.   Next step?  If it’s not happening already, prices will rise and fall based on forecast demand-  like on Amazon and with airline tickets, just to give two examples.

With cash in the bank from growing season pass sales, better predictive abilities, and some nonwinter cash flow, do you need to encourage people to show up the same way you used to?  How does your marketing change, and what are you going to sell exactly?

Here’s how SAM, my favorite industry magazine, reported on what some resorts are doing.

Homewood Mountain to Become Semi-Private Resort  I don’t know if this will work out or not.  Neither do the people at Homewood it sounds like.  Suggest you read the comments for further perspective.

Luxury Gone Wild  Obviously, this will tend to be a summer thing.

Both these initiatives are aimed at higher income people.  Meanwhile, for many to most people, wage increases are not keeping up with inflation- especially in food, energy, and rent.  And you should know the Federal Reserve has almost never been able to raise interest rates without causing a recession.

The rise in income inequality isn’t the fault of mountain resorts.  I’d lay that firmly on Congress, the Federal Reserve, and the way we finance elections.  But whoever is to blame, it looks to me like our industry’s diversity goals are taking a hit.  That’s troubling as many resorts are operating on public land and it seems like access is increasingly shewed towards the wealthier.

This article is all over the place. What am I trying to say here?  Two things.  First, I am concerned that business conditions and traditional good management practices will further push the mountain resort business, especially the winter part, towards even higher income participants.  Like airplanes landing and taking off, there’s only room for so many.  I would like to be wrong.

Second, we don’t usually think of pandemic influenced events as good news.  However, we (as in our species) isn’t a group that welcomes change.  We usually need to be shot out of a cannon to be pushed somewhere we don’t want to go.  The pandemic has made it all right to think new thoughts and do new things.  That’s exciting and I’m enjoying reading about resorts that are taking advantage of it.

Good things happen when the rules change.  Kind of hoping that thing two can help with thing one.

Jeff Harbaugh has more than 20 years spent developing strategies to respond to changing market conditions, in-depth, objective knowledge of the action sports/outdoor/youth culture industry and skills to help you manage growth and make the transition from entrepreneur to manager.


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