Original Post

Despite Weather, Resorts on Liftopia See Impressive Results

April 12th, 2012

With most of this season in the books for most US resorts, I got in touch with Evan Reece from Liftopia to hear their view on how things shook out. With the launch of Cloud Stores, LiftTickets.com stepping up their game, and more and more resorts signing up, it proved to be an interesting year all around.

With a lot of ground to cover, I kept the questions pretty open ended to let Evan explain some of the things we had been chatting about.

Gregg: The mantra of Liftopia has been advanced purchasing. What did this less-than-ideal season teach you about this concept?
Evan: This year we have learned a tremendous amount about advance purchase, especially as it pertains to broader pricing strategy. It has never been more clear that advance purchase is tremendously important for ski resorts. This year we saw that the combination of an effective advance purchase strategy with appropriate on-mountain pricing enabled resorts to grow both overall revenue and overall yield in the worst season on record.

Gregg: On the flip side, what trends did you see in old-school discounts?
Evan: What we hear from resorts all over the country is that visits associated with traditional discount channels like grocery store deals, membership programs, gas station deals, and other BOGO’s were all down year-over-year. This shows to us that these unfenced discounts are purely a function of absolute demand and do nothing to spur new demand. We hear from resorts nationwide that these programs did nothing to help in this rough year, and more importantly it proves that these outdated channels simply pull revenue from resorts during their peak times.

Gregg: So, what do both of these trends mean for resorts and their pricing strategies?
Evan: The combination of advance purchase success and yield gains on window sales make several things very clear. First, resorts that make advance purchase their top priority for 2012/13 will substantially outperform competitors that do not. Second, success in advance purchase hinges on a broader pricing and distribution strategy that involves revisiting the standard approach to window rates and removing unfenced old-school discounts from the market.

Gregg: As far as Liftopia’s platform performance went, how did this year compare to last?
Evan: This season was very interesting. Similar to our resort partners, we were frustrated with the absolute drop in demand due to challenging weather conditions. That said we still saw substantial growth in resort partners, products, searches, bookings, and resort net revenue. What is most promising is that despite the challenging year, products on the Liftopia platform year-over-year saw average yield growth of 7.4%. Additionally, resorts that got up and running ahead of the season on Liftopia substantially outperformed those that came onto the platform later, as they capitalized on positive pre-season consumer sentiment ahead of the “doom and gloom” spread by the press.

Gregg: Cloud Store is being adopted pretty quickly, how is it performing?
Evan: As you know, we launched Cloud Store in the fall to a very limited group of resorts. Preliminary results have been very promising and strongly indicate both revenue and yield growth next season for resorts that make the most of the broader Liftopia Platform. Most importantly, our goal is to make our partners happy and grow their businesses. We are already hard at work on Cloud Store product improvements for next season. This season test clients ranged from Crystal Mountain in Michigan which grew advance purchase revenue from 1% of skier visits to +10%, to Park City in Utah which booked $25k in net revenue in their first day, to Bolton Valley in Vermont which booked $15k in net revenue immediately after hitting their email list with an effective marketing push. We are excited for our improved toolset to drive substantially more revenue and yield for partners in 2012/13. We expect resorts to book revenue for next season before this season is over.

Gregg: Does all this have any impact on season pass strategies?
Evan: The great news is that season passes are the original proof point of the success of advance purchase for ski resorts. Resorts that apply the same logic to date specific products can offer complimentary sales to additional customer segments without putting more downward pressure on their pass prices. Essentially, pass prices that are priced appropriately to the segment (high frequency user) alongside a successful pricing and product strategy for dated products allows resorts to offer opportunity for their entire customer base to buy in advance without trying to land on one price point for all consumer segments. This may seem a bit drawn out, but what is clear is that resorts that have good multi-product execution can have all of those products priced appropriately.

Gregg: How much of the success Liftopia is seeing depends on the technology behind the scenes and how much depends on what the technology allows you to do and what it does for a skilled marketer?
Evan: We have seen time and again that success in advance purchase is not as simple as a piece of technology. It is rock solid technology PLUS an effective product and pricing strategy PLUS an appropriate marketing and merchandising approach. Having a quantifiable marketing approach is especially important for resorts that want to make the most of the Cloud Store piece of the platform. We have seen those who successfully manage their email lists, their websites, their social media, and their broader marketing/merchandising mix substantially outperform those that don’t. Resorts spend huge dollar figures on their marketing. With the Liftopia Platform, our resort partners can carefully measure the success of each of their marketing initiatives as opposed to throwing dollars at un-trackable branding exercises. It’s is all about good tools, smart marketing partners, and data-driven execution to drive more revenue than ever before.

I can assure you with a huge degree of confidence that there is no larger revenue opportunity for the ski resort industry than fundamentally shifting approach to advance purchase.