Aspen Skico exec explains passes and pricing strategy
August 26, 2009
ASPEN – Most people who bought Aspen/Snowmass ski passes last season will either spend less to ski this winter or have the ability to ski more for the same price they paid last year, according to David Perry, Aspen Skiing Co. senior vice president.
Perry discussed the rationale behind the Skico’s pass options and pricing Tuesday with the Aspen Chamber Resort Association board of directors.
The company dropped the price of its Premier Pass – the pass good for unlimited skiing and riding at the four local ski areas – by $200, but has taken heat for the elimination of pass options it used to make available, most notably the two-day pass that allowed two days on the slopes for each week of the ski season.
Crunching the numbers, including how many days passholders were actually skiing, led to this season’s new pass options and pricing strategy, according to Perry.
“Literally 95 percent of all our season passholders will either pay less for the same amount of skiing or get more skiing and more flexibility for the same amount,” he said.
Among the vocal 5 percent who are dissatisfied are those with a legitimate gripe – skiers and boarders who bought the two-day pass last season and hit the slopes once a week religiously and often twice, Perry said. They were “well-served” by the now-defunct two-day pass, he said.
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But the vast majority of individuals who bought the two-day pass for the ACRA-discounted price of $919 didn’t ski or ride twice a week. The pass was used an average of 14 days, he told the ACRA board.
With the Skico’s new $699 Flex Pass, good for one day of skiing per week and the ability to add extra days for $49 per day, a passholder could get 24 days on the slopes for roughly the cost of the old two-day pass, Perry said.
Those who really want to ski two days a week or more are better off purchasing the Premier Pass – at $1,099 for those employed by chamber-member businesses – which has led critics to charge the Skico with a “bait-and-switch” tactic.
The Skico, though, doesn’t expect to realize greater revenues from ski pass sales this year as a result of driving more buyers to the Premier Pass, Perry said. The drop in the price of the pass means less revenue.
“We are not going to collect the same amount of money we did a year ago,” he told the board. “Our revenues will be down.”
The Skico also has eliminated the 20-day pass, which its buyers used an average of 12 days last season, according to Perry. The pass was not economical for a dozen days on the slopes.
“People were actually paying a hundred dollars a day or well over a hundred dollars a day to ski,” he said.
Board members also quizzed Perry on the reason for eliminating the four- and seven-day Classic Pass options; this season, only a five-day Classic Pass will be offered, and it can’t be used to augment other passes.
Last year, 30 percent of pass buyers purchased a Classic Pass on top of either a one- or two-day pass; so the Skico introduced the Flex Pass to offer the flexibility of skiing or riding extra days, Perry explained.
The four-day Classic Pass was popular with Front Range customers, he told the board. The Skico is hoping to entice them onto the slopes for an extra day.
ACRA board chairman Warren Klug quizzed Perry on a pass pricing strategy that puts Aspen/Snowmass among the most expensive in the state. The cost of a Premier Pass for someone who doesn’t qualify for the chamber discount is $1,499 (if it’s purchased by Sept. 18), while Vail Resorts is offering the $599 Epic Pass, good for unrestricted access to five Colorado resorts – Vail, Beaver Creek, Keystone, Breckenridge and Arapahoe Basin.
“Vail has a different business model than we do,” Perry said.
Vail Resorts relies on volume and has a huge Front Range population from which to draw skiers and boarders, he said, while the Skico couldn’t cut the price of the Premier Pass in half and sell twice as many of them.
“We don’t have the volume of skiers to draw from,” Perry said.
While the Skico would like to see its skier visits increase, it doesn’t want to “inundate the experience” with the kind of crowds the Interstate 70 resorts see, he said.