Aspen vs. Vail |

Aspen vs. Vail

ASPEN ” Vail Resorts has opened a new battlefront in the competition with Aspen and other resorts over out-of-state and international skiers.

Vail is offering its Epic Pass at a discounted rate through Sunday, May 4. The pass provides unrestricted skiing at Vail, Beaver Creek, Breckenridge, Keystone, Arapahoe Basin and Heavenly at Lake Tahoe for only $579. In an unusual step, a major resort is making a cheap season ski pass available to skiers and riders that live outside of Colorado.

“This is a first,” said Jerry Jones, a longtime Colorado ski industry veteran who is now a consultant based in Avon. Usually ski areas want destination guests ” those taking overnight trips ” to buy more lucrative multi-day lift tickets rather than cheap passes, he said. So Vail’s move comes somewhat as a surprise.

Jones said the primary target market of the Epic pass is Colorado’s Front Range skiers. Vail Resorts has been engaged in a decade-long price war with Copper Mountain, Winter Park and Steamboat for that lucrative market segment. But Vail Resorts also is offering the cheap pass to destination skiers to get them to return more frequently and, possibly, to entice them to visit Vail Resorts’ ski areas exclusively.

The move captured the attention of Aspen Skiing Co. officials. During the season that just ended, destination skiers paid $532 for a seven-day lift ticket at Aspen/Snowmass. Savvy second homeowners or frequent visitors could purchase a 20-day pass for as low as $1,099 or a seven-day Classic Pass for $259. (Prices haven’t been announced yet for the 2008-09 season.)

For $47 more than the Skico’s seven-day lift ticket, a destination guest can purchase a pass with unlimited time on the slopes at Vail Resorts’ ski areas for next season.

Skico President and CEO Mike Kaplan said in a recent interview that it was “possible” that Vail’s strategy could affect Aspen’s destination business.

“We’re definitely looking closely at our pricing and our products to make sure we’re competitive,” Kaplan said. “Especially on the international side, they’re probably trying to target that group.”

But for now, Kaplan and David Perry, Skico senior vice president, mountain operations, don’t see a need to change pricing for destination guests.

“We actively compete with Vail Resorts and others for destination guests, and we have very compelling offerings of high-quality and excellent value for price in our various markets,” Perry wrote in an e-mail interview.

For example, in Australia, one of the Skico’s biggest international markets, the company runs a promotion where a buyer gets 12 days of skiing if they buy eight days, or they can buy 12 days and get 20.

“Overall, we are very comfortable with our competitive position,” Perry said.

Jones, who never pulls punches when assessing the ski industry, said there was no need for the Skico to react to Vail Resorts’ Epic Pass pricing.

“I think it will have very little impact on Aspen,” said Jones.

Lift ticket prices are a relatively small portion of the overall cost of ski trips, Jones noted. And the potential savings that a destination skier could reap by going to Vail rather than Aspen, due to the Epic Pass, probably isn’t enough to influence many consumers.

“Am I going to change my mind to save $300?” Jones asked. “They’re not going to do that.”

A skier from Colorado’s Front Range who wants to ski Aspen will probably will continue to visit there, regardless of Vail’s pricing policy, Jones added.

He believes Vail’s move will have a greater impact on Copper Mountain, Winter Park, Steamboat and, to a lesser extent, smaller ski areas like Loveland and Eldora. All those resorts rely heavily on the “drive market” from Denver and surrounding areas.

“This is such a great deal that you really can’t compete with it,” Jones said of the Epic Pass. “These are ’70s and ’80s prices for season passes.”

Jones speculated that Vail Resorts’ was willing to drastically discount lift ticket prices, via the pass, in hopes of generating significantly more skier visits next season. If it successfully attracts more skiers to its resorts, it can make up the loss on lift tickets by getting those customers into ski schools, on-mountain restaurants and lodges. Vail Resorts is “very much vertically integrated” into all aspects of the resort, so it can capture customers’ money in various ways, Jones noted.

He also believes the motivation for the publicly-held company is to generate revenue in a traditionally slow period. Epic Pass buyers only have to place a $49 deposit by May 4, then the rest of the pass price is charged to them in September. That creates revenue during a slow, preseason period for Vail Resorts, so that boosts its stock, Jones said, adding “Vail only does things that enhance their stock values.”

While Jones credited the company for its bold pricing strategy, he said it could backfire. “It’s a calculated risk and the downside for Vail is overcrowding,” Jones said.

Even before this push to get additional skiers, lift lines were significantly longer at Vail Resorts’ ski areas than at the Aspen Skiing Co.’s areas. Skico officials have continually justified their higher season pass prices for the value and quality of experience at Aspen Mountain, Aspen Highlands, Buttermilk and Snowmass.

Kaplan acknowledged Vail’s cheap pass price put the Skico somewhat in the hot seat. “Yeah, I think a little bit. A couple of people have (asked) ‘Are you guys going to match that?'”

They aren’t, he said, but the Skico still feels its local skier base still gets a good value ” and realizes it.

“Compared to Vail and Beaver Creek, especially on weekends when locals can ski, we’re offering a pretty good value out there in terms of the number of people per acre. And as hard as it is to park in Snowmass, go try to park there.

“We think we’re different. We offer a different product,” Kaplan said. “We think it’s a compelling product, one that people appreciate and enjoy and want to continue to enjoy. So, we’re not going to match that price.”

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