Kaye, what are you doing?
If you happen to bump into Kaye Ferry in the next few days, you might want to tell her that her off-handed but repeated comments to the Denver press – quoted on behalf of the Vail Chamber and Business Association – will inevitably cause the price of skiing for locals to rise astronomically.
Even now, in this tough national economy, Vail Resorts is under considerable pressure to raise our current low season pass prices for locals.
But if Kaye’s and the chamber’s comments truly take root, the price of skiing could as much as triple for local Eagle County residents in future years.
At Vail Resorts, we think that would be foolish and unnecessary. Therefore, we are taking this unusual step to publicly ask Kaye and the Vail Chamber to think long and hard about the likely ramifications of these ill-considered press comments.
What is all this about?
Well, with all the deals Vail Resorts has in the market locally combined with high usage, on average local Eagle County adult skiers tend to ski for about $15-$20 per day in round numbers. Based on their usage, Front Range adult skiers tend to pay about $35 per day, and out-of-state adult skiers pay about $65 per day. Therefore, out-of-state skiers and riders are in effect subsidizing Colorado skiers and riders. And similarly, Front Range skiers and riders are subsidizing local Eagle County skiers and riders.
Kaye’s problem is that she believes we have too many lower-spending Front Rangers skiing in the Vail Valley, and at every opportunity she tells them so through the Vail and Denver media, including yet again this week in the Denver Post. Sooner or later, they will get her message that the welcome mat is not out for them in Vail, and they will simply stop coming.
And that would be a tragedy for us and for all of you, for three reasons.
First, Vail Resorts receives about $40 million, repeat FORTY MILLION dollars, annually in revenue from Front Range season pass sales. If that income were to go away, we would have to replace it somehow (or else literally we would go broke, which trust me, would be devastating for the Vail Valley economy). Since our out-of-state prices are already the highest in the nation and cannot be raised easily, and since local skiers now pay less than one-third per day of what out-of-state skiers now pay, it is inevitable that local skier prices would have to soar in such an event.
Second, contrary to popular myth, front rangers do spend money here. In fact, for the past four years, one of the fasting growing visitor groups to Vail has been the so-called “Colorado Overnight” market, who stay in Vail hotels and condos, who eat in Vail restaurants and who shop in Vail stores.
Third, for years the Vail Valley has been trying to build-up the appeal of our off-season summer tourism business. Just what is a big source of our summer market? Bingo, the Front Range. If they feel unwelcome and offended by a lack of embrace by the Vail community in the winter, they will not come here in the summer either.
Now don’t get me wrong. Vail Resorts wants more of the lucrative higher-spending out-of-state skiers to return to Vail. We would benefit more than anyone else if that would be the case, and are spending more and doing more than anyone else to make it happen.
Remember, just in the past three years, we have paid for Blue Sky Basin (at a cost of more than $20 million), the renovation of the Vail Marriott ($23 million), new lift equipment and more snowmaking at Vail and Beaver Creek (about $10 million) and plans to redevelop Lionshead and Vail’s Front Door (nearly $10 million so far, and counting) – all of which are incredibly popular with out-of-staters.
Despite our best efforts – not to mention huge multi-million dollar marketing budgets – directed to luring out-of-state skiers to Vail and Beaver Creek, it is a very sad fact that out-of-state visitors to all Colorado ski resorts has had a whopping decrease, falling by about 15 percent in the past several years. Why? 9/11 did happen. The Iraqi War did happen. The United Airlines bankruptcy did happen. The weak economy did happen.
We, too, realize that increased Front Range visitors cause new and different challenges, and Vail Resorts is committed to helping solve whatever new issues may arise if we can. For example, we have pledged over $4 million to support the availability of increased Vail parking.
But even though we are as eager as anyone to have the out-of-staters come back, we are smart enough not to insult our Front Range or, for that matter, local skiers while we attempt to make that happen.
It is easy to whine that the good old days have gone, but that does not bring them back. And just as we have no choice other than to adapt to change, others including local merchants will have to adapt their strategies because of change, too.
Some $40 million annually is at risk for Vail Resorts, not to mention the very economic viability of our company – which would have huge, almost incalculatable ramifications for the economic vitality of the Vail Valley. This is a big issue for us, and should be a big issue for you.
Remember the World War II adage that loose lips sink ships? In the case of Kaye Ferry and the Vail Chamber, they just might sink low prices for locals to ski and ride, as well. That would be an unnecessary tragedy that Vail Resorts hopes that Kaye and the chamber are smart enough to help us avoid.
As a community, we simply have to stop insulting our Front Range guests in their Front Range media.
Adam Aron is the chairman and CEO of Vail Resorts.