International visitors are paying more now to visit
By the numbers:
$1.07: Dollars required to buy one Euro Nov. 6
$1.25: Dollars required to buy one Euro Nov. 3, 2014.
$1.50: Dollars required to buy one British Pound.
17,910.33: Nov. 6 closing price of the Dow Jones Industrial Average
Source: Yahoo Finance
EAGLE COUNTY — A dollar goes a lot farther than it used to — but only if you’re traveling internationally.
A combination of global economic factors mean the U.S. dollar is as strong now as it’s been in years. That means travel to most other countries in the world is a relative bargain for Americans right now. But it also means foreign visitors are paying more for their American vacations.
What does that mean for the Vail Valley? It’s kind of hard to tell. Vail Resorts remains bullish on international visits.
In an email, Vail Resorts Vice President of Communications Kelly Ladyga wrote that the company remains confident its international marketing is on the right track.
“We market to a higher spending international guest who tends to be more insulated from fluctuations in currency exchange rates,” Ladyga wrote.
On the other hand, the dollar is particularly strong against the Canadian Dollar and the English Pound. That’s put pressure on visitors there, Ladyga wrote, adding that the company has seen “sluggishness” in reservations from those countries.
On the other hand, Ladyga wrote that the company expects dips in visits from Canada and Great Britain to be “more than offset by strength we’re seeing from Mexico, Australia and our domestic markets.”
EPIC PASS INTERNATIONALIZATION
The acquisition this year of the Perisher ski resort in Australia could be particularly valuable. The Vail Resorts Epic Pass is now the season pass at Perisher, which means skiers there can use their passes at the company’s other resorts in North America or, for five days, Verbier in Switzerland.
Ralf Garrison is the principal owner of Destimetrics, a Denver-based market research and consulting firm that tracks lodging occupancy and other economic indicators at mountain resorts. Garrison said he believes the internationalization of the Epic Pass is a way for Vail Resorts to insulate itself from economic and weather conditions.
On the other hand, a strong dollar could be having an impact on a dip in winter lodging reservations made in September. Those numbers dipped significantly compared to the same period in 2014. That was the first significant drop in about 36 months, Garrison said.
While Garrison called the reasons for the dip an “economic who-done-it,” the fact that international guests tend to book months in advance could be part of the puzzle.
“In Canada, for example, guests will spend between 20 and 25 percent more (for vacations) this year than last,” Garrison said. “It’s about the same in Mexico … and they’re paying more with no commensurate increase in value.”
Given that overseas guests generally stay longer and spend more, that higher price climbs even further.
FLYING ABOVE THE STORM
On the other hand, Garrison said, resorts with a long history of hosting international guests will probably ride out the current currency fluctuations. Aspen and Vail are either atop, or close to the top, of that list of resorts.
“That product tends to fly above the storm clouds,” Garrison said.
The Vail Valley Partnership handles a big part of the valley’s lodging reservation business. Partnership CEO Chris Romer said that group leaves international marketing to Vail Resorts — the company has the know-how the local group lacks.
But, Romer said, he’ll be interested to see the dollar’s impact on Australian visitors.
“They tend to be more price-sensitive and come during slower times in January and early February,” Romer said.
While the group Romer leads is more interested in bringing people to the valley than sending guests elsewhere, he acknowledged that this is a particularly good time for U.S. residents to travel internationally.
“We need to take advantage while the prices are good,” he said.
Vail Daily Business Editor Scott Miller can be reached at 970-748-2930, email@example.com and @scottnmiller.