Weak dollar, strong sales
When David Perry was a top executive at Whistler ski resort in the late 1990s, the Canadian dollar was so weak that business from the United States skyrocketed 50 percent in one year alone.Now it’s the U.S. dollar that’s weak, and Perry, senior vice president of marketing and sales for the Aspen Skiing Co., suspects that skiers from places like the United Kingdom, Australia and Germany will jump to take advantage of deals at U.S. resorts.The Skico won’t enjoy 50 percent growth from its international markets like Whistler did a few years ago, but it could cash in on significant gains, Perry said.He noted that the euro, the common currency of many European countries, has increased about 35 percent compared to the U.S. dollar over 18 months.”In effect, it’s 35 percent more affordable for Europeans to come to the U.S.,” he said.The British pound was worth $1.92 as of noon Thursday. A euro was worth $1.32. The Australian dollar was at $0.77 compared to the U.S. dollar, the highest it’s been in ages.
That’s significant because the United Kingdom, Australia and Germany are the top three foreign markets for the Aspen Skiing Co. All international markets total about 15 percent of the company’s total skier days, or the number of lift tickets sold in a season.Perry wouldn’t go public with anticipated growth for this season. However, he said early bookings indicate the numbers are up. To help encourage business from overseas markets, the Skico offered a special package on lift tickets. People who bought eight lift tickets received another six for free, if the purchase was made prior to Dec. 1.Perry noted that another important development in currency exchange rates is the increasing strength of the Canadian dollar. It’s at a 20-year high compared to the U.S. dollar, he said. But more significantly, it’s strong against the Australian dollar. That could make Aussies think twice about going to resorts like Whistler and make them more likely to ski in the United States.Colorado resorts like Aspen and Vail drool over international business because foreign skiers tend to stay longer and spend more on lift tickets. Aspen and Vail capitalize on foreign business because of high name recognition.The 24 resorts in Colorado Ski Country USA draw between 7 and 9 percent of their winter business from foreign markets, according to Sue Baldwin, vice president of business development for the state trade association.To demonstrate how currency exchange rates influence travel, Baldwin noted that business from Australia peaked in 1996-97, when there was a favorable exchange for Aussies.
“When the currency crashed, the visitation dropped significantly,” she said.This year, there is a “big buzz” about potential growth in the international market again, Baldwin said.Hopeful marketing executives aren’t the only ones expecting growth. Bob Mill, a professor of tourism at Denver University, said the weak dollar will attract foreign skiers to Colorado, as long as snow conditions are favorable.However, skiers in the United Kingdom will compare snow conditions between Colorado and European resorts before deciding where to go, Mill said. Just as the trend is for skiers in the United States to book trips closer to their travel times, skiers from countries halfway across the world also wait longer when booking ski trips to the United States.”The world is shrinking,” Mill said.Tucker Hart Adams, president of The Adams Group economic consultants and chief consultant for U.S. Banks in the Rocky Mountain region, agreed that the weak dollar could boost foreign travel to Colorado. Another potential effect, Adams said, is keeping more U.S. skiers in the country.
Molly Campbell, the longtime general manager of The Gant Condominiums in Aspen, said her early bookings by travel agents show international business is up 4 percent over the same time last year. More significantly, domestic bookings are up 15 percent.”I really think a lot of people will be staying home [rather than traveling abroad],” Campbell said.The Gant will also welcome any boost in business in foreign travel caused by the exchange rate. About 25 percent of the room nights purchased at the condominium complex are by residents of other countries, Campbell said.The Skico is also poised for an increase in destination visits from U.S. skiers because of the decreased buying power of the dollar abroad, Perry said. That benefit of the weak dollar could be as great or greater than more skiers visiting from foreign countries, he said.Scott Condon’s e-mail address is email@example.com