SPECIAL REPORT: SE GROUP'S FUTURE OF THE INDUSTRY SURVEY 2012 PART III
Part 3 of a six-part series on the Future of the Industry survey conducted by SE Group. This time we tackle competition. Comments welcomed and appreciated!
CHALLENGE #3: COMPETITION FOR LEISURE/ENTERTAINMENT/RECREATION DOLLARS
“There are so many other activities that are vying for our customer’s attention…”
Under the recurring theme of business as usual, the ever-increasing competition for the discretionary dollar is not a new challenge in our industry. It has often been noted that a ski area’s biggest competitor is not the neighboring hill, but rather Disneyland, the soccer league, the mall. So many choices, so little time!
While not a new challenge, emerging trends within the world of leisure are definitely ratcheting up the competitive landscape. That said, in the spirit of CHALLENGE = OPPORTUNITY, the industry continues to focus on ways to remain relevant in this broader leisure/entertainment/recreation marketplace.
The general lack of ethnic diversification within the current skier population presents a tremendous growth opportunity for the industry. As the ethnic makeup of the country evolves, the industry must continue to find ways to penetrate ethnic segments that have lower a incidence of snow/ski participation, and make it easier to introduce these groups to skiing and riding. Areas like Mountain High, Calif., have had great successes in this arena, and are integrating diversification throughout their operations. This includes hiring practices for front-line employees and management.
The family unit, from a recreation leisure standpoint, is stronger than it has ever been—the family is playing together. This is a positive trend for the industry, especially as facilities become more year-round. And there is no better sport than skiing for spending time together as a family.
“More so than ever, children dictate the family vacation and second home purchases. Further, kids tend to be more loyal to places where they have had great experiences. We are now in the business of selling to 8-year-olds.”
It is important to remember the decision-making dynamics of the family. In addition to children influencing how the family’s leisure time is spent, moms are more often than not the key decision-maker when it comes to deciding how the family will spend time together. Think about this as you craft your marketing message.
“The interest in and opportunities for our customers to go abroad, and foreign nationals to come here to participate in winter recreation, constitute both threat and opportunity.”
The rising amount of travel opens up a more international marketplace. Can North American resorts compete on the international stage?
Skiing and snowboarding are lifestyle sports, and the mountains are lifestyle destinations. Ski areas, mountain resorts and mountain communities will always have the competitive advantage of the lifestyle appeal of the sport and the locale.
“Let’s not forget that we are in the FUN BUSINESS—keep it easy, keep it as hassle free as possible, keep it fun!”
Skiing is cool again, and continues to have a “fundamental aspirational appeal” in the marketplace. The industry can continue to sell an authentic experience and be true to the sport of winter skiing. The broader four-season palette of mountain-oriented activities may have a less aspirational appeal, but broaden the potential market capture by providing “pure, unadulterated, no hassle fun.”
“Staying youthful and healthful is more important than ever.”
Over the past ten years we have seen a growing trend toward healthy lifestyles: becoming more physically fit, looking for ways to get outdoors and have fun experiences with families and friends, seeking connections with like-minded people. In addition, the mountain environment provides an antidote and escape from our increasingly fast-paced, technology-based society.
“Holistic packages should cover mountain activities, body rejuvenation, quality food and diet, rest, and the one missing ingredient at many resorts, intellectual interaction.”
Mountain resorts are well positioned to attract those seeking such experiences by communicating the vitality and social aspects of the resort environment and lifestyle, and emphasizing the “experience” part of the visit—be it learning a new sport, taking part in a new activity, learning something through a class, taking in beautiful scenery, or getting a great massage.
Destination resorts may play upon this theme to encourage a transition to “destination living,” an opportunity to work and play in a resort setting.
OPPORTUNITY: ADVANCES IN TECHNOLOGY—MARKETING AND MEDIA
“All of us, of whatever type, are better positioned than in the past due to the improved knowledge of our guests, the greater ability to reach them and precisely tailor products to their needs and desires.”
The recent advances of media technology continue to have a profound impact on how we do business. Resorts are now able to gather vast amounts of data and information about their customers, and have many more ways of directly communicating with them. Resorts may use this information to develop unique product and service niches that are in direct alignment with the needs and desires of their customer base. This ability to brand and differentiate from the competition is an important component of how resorts are being sold in today’s marketplace.
Of course there are many pros and cons of the use and impact of social media for resorts. While it effectively allows the enthusiast’s evangelical promotion of a resort to gain much greater reach (think of Vail’s EpicMix), we have also seen the damage done by the recording of a negative experience gone viral (think Snowbasin).
Collaboration within the industry will continue to be important as the competitive challenge from beyond the industry continues to grow. This includes uniting behind industry initiatives aimed at increasing exposure to the sports of skiing and snowboarding and growing core participation. In addition, survey participants noted other opportunities for collaboration.
- Collaborations between destination resorts, feeder and breeder areas. Each type of facility is important to the sustainability of the industry, as each provides a different level of access to the sport. As each type benefits from the presence of the other, each should collaborate with and support the other.
- Inter-business partnerships. With the technological advances in media, collaborations with similar lifestyle products (i.e. the sponsorship of the X Games by Jeep) provides mountain resorts with an exponential increase in market visibility.
- Environmental group partnerships. Partnerships with environmental organizations/groups allow mountain resorts to support the sustainability of the natural environment, the integral backdrop for all resort activities (i.e., Vail’s 1% from summer ticket and activity revenue to support The Nature Conservancy and forest health).
- Strategic investments. Resorts may purchase other connected businesses that provide experiential opportunities for guests (i.e. raft/guide companies).
- Public/Private. “Blur the lines and turf to provide better service AND be more sustainable.” Mountain resorts continually struggle to provide activities and amenities for their guests and property owners. The communities in which resorts exist likewise struggle to provide amenities and recreation infrastructure to their residents. Can there be an “evolution from a wholly-owned resort mentality to a campus that requires an array of community services?” What would the structure of such an alliance be, from a financial and governance perspective?
Food for thought.