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WTF?! Explain season pass pricing to me.

post #1 of 24
Thread Starter 
So I'm planning my first trip west and looking at Tahoe. On a lark, I glance at season passes for Heavenly. They have a season pass for $339, with some blackout dates.

WTF?!!?11?1!1!?11!eleventy?!?!!

Wilmot Mountain, a crumby 200 foot high hill in Wisconsin is $345 with no blackout dates. What gives? I can't explain the pricing disparity. Can anyone comment on how this makes any sense?
post #2 of 24
 Don't look for logic.  Two years ago Squaw Valley seasons pass was $1899, now you can get it for $899, no blackouts, it is still the same mountain.  If I can make a wild guess:  Heavenly makes most of its $'s from the casino tourists who come to gamble and may "try" skiing for a day or two.  Also, competition in Tahoe is very tough and Hevenly is a good mountain but not great.  Anecdotal evidence is that most locals there ski at Kirkwood and Sierra as the terrain is better there, so Heavenly may want to tie people to its slopes by heavily discounting the pass.  $339 is really cheap, a friend from Boston went to SoLake for a week and it was cheaper for him to buy a pass than pay his lift tickets.  Whatever works.   
post #3 of 24
Before the start of last season the cost was the same ($399) for a pass at the three small ski areas nearest me (Roundtop/Liberty/White Tail in Pennsylvania) as at Keystone/Arapahoe Basin/Breckenridge in Colorado.

This is one of the reasons I am moving back to Boulder as soon as I find a suitable job there.
post #4 of 24
 Lots of smart people (Karl Marx, Adam Smith etc...) used to write books and build theories about product (ski pass in our case) price formation.

It is safe to assume that the final numbers you see on the web pages  were calculated by taking into account careful observation of the spots on the Sun, color of the tail feathers of the rooster that woke up youngest liftie of the resort and birth date of my maternal grandma. In the certain scientific circles of the society it is also called "brown elbow number" 
post #5 of 24
It is all about marketing and figuring out your market. When I started skiing Tod Mountain, B.C. in the mid 70s they had 2000 to 2500 season pass holders on a back woods mountain with almost no facilities (and only about 30 to 50 people skiing mid week but that is another story).

Fast forward to the early 2000s and it is now Sun Peaks Resort with 7 hotels, condos,  new lifts, bars and restaurants, some snow making, lots of grooming etc. Season passes are $800 full price, and $600 if you purchase by June and still only around 2000 pass holders.  So Sun Peaks Corp decided to lower the early season price to $400 which was equal to purchasing 8 days of lift tickets. Season pass sales jumped to 7000 people and the Corp made nothing but $$.

Today the before the end of June price for a pass is $559, but at $72 for a day ticket it still takes only 8 days of skiing to pay off a pass. Almost all of the Aussies coming to Sun Peaks buy their pass in June as do several people planning 2 or 3 long weekend visits.

Discounting can work.
post #6 of 24

Bulk pricing is a somewhat artistic subject in general, but for ski areas it's particular so - because there's no marginal cost to the ski area. To use an example: say you've got a customer who would most likely ski at your area one day a season, and buy a single $50 lift ticket. Now suppose you offer a $51 season pass ... and he buys it, and skis at your area 15 days. You've still made an extra dollar.

But not so fast: you've got to balance that free dollar against the other guy who loves your ski area so much he'd happily pay $1,500 for a season pass ... turns out you just threw away $1,449 of his dollars.

If you can scientifically measure the exact point where these balance out, you may have a career as a ski-area consultant.

A few other things to consider:
- An additional skier isn't really costless ... if lift lines, hikes from parking spaces, etc. get too daunting some bad things might happen. Then again, maybe that amounts to worrying that you'll become a place that's so crowded nobody goes there anymore.
- An additional skier actually puts some money in your pocket in the form of the profit you make peddling him burgers and souvenir zipper pulls.

post #7 of 24

First theres a few simple things to consider:

 

1) Tourist market - More day ticket sales tends to lower season pass prices.  Resorts with more "local" skiers than tourists tend to have higher pass prices.

 

2) Snowmaking - It's expensive!... More reliance on it tends to higher season pass prices.  Hence, east coast resorts costing as much as the Western resorts.

 

3) Marketing - Take the first two then see how you compare to the competiton!

 

 

Also, business model is a major factor.... some ski hills rely on early season pass sales to fund the pre-season work, opening weeks and initial wage bill, so will offer cheaper passes to get more cash in the bank so they can simply operate. After this day ticket sales pay the bills.   If they work out the money they need in the pot, then try and find the sweet spot on price to number of passes to be sold early. 

 

post #8 of 24

1) charge as much as you think you can get.

2) make the season's pass more expensive and offer a big discount for early birds to encourage early sales.

 

That's about it.

post #9 of 24

I'm so glad we continue to confuse everyone with season pass pricing.  It's nice to know the industry is doing something right!

 

Some areas do a good job modeling pricing and building campaigns to drive sales at the pricing they want.  Those areas are also few and far between.  Here's the real secret: marketing managers write 17 different prices on Post-it notes and paste them to their wall.  Then they close their eyes, spin around 3 times, and throw a dart at them.  Then they think about that number for a long, long, long time; maybe even a week or so.  Their goal is to come up with a purchase program that will be poorly described in an effort to further confuse consumers.  For example, you might have to round up 3 of your buddies and physically show up at the pass office to purchase your passes.  Or, you might be able to pay in 3 installments with each installment due at random times.  Finally, different pricing and purchase programs are offered to different groups of 'special' people to really alienate the core customers.  Yup, there is lot of behind the scenes work that goes into this stuff.

 

Keep in mind, there's three ways to gain marketshare: create a new market, expand an existing market, and to steal from the competition.  In tough economic times, the smartest thing to do is steal from the competition.  We're seeing a bit of that this year, but I predict if everything stays the same with the economy, namely unemployment, we'll see that trend really increase next year.


Edited by vinn - 5/11/10 at 10:49am
post #10 of 24

It's simple - competition.  Compare these two prices for 09/10 passes in the Rockies:

 

Jackson Hole (no competition) -$1970

Breckenridge/Keystone/A-Basin (lots of competition) - $399

post #11 of 24

I don't know.  What competition does Whitefish have?  Blacktail?  1 hour 45 minutes away and hardly in the same category.  Fernie?  Also a couple hours away.  And neither is near a large metro area to speak of, so the two hours is truly a big deal for its locals.  The pass for next season hasn't been announced yet, but it was $535 last year.  Schweitzer, a similar mountain near Spokane, is $599, so maybe it's trying to undercut that, but the four hour commute has to count for something on that...I certainly wouldn't drive 4 hours to save $60.  Snowbowl down in Missoula was $509 last year.  Similar market.  The populations are pretty spread out, no real critical mass of ski areas either.  And yet, we're not being raped.

post #12 of 24

The price of my season pass has stayed the same for 3 yrs now. I'm not confused.

post #13 of 24

my squaw pass dropped over $1,100 last year.

 

it does have something like 11 blackout days, but only 4 apply to me because i fly home for xmas every year anyways.

 

the new cheap passes are sweet.  they've brought more people to the hill which means more chairs spinning and a more irie scene.

 

now we just need to get people to learn that skiing in may is INCREDIBLE so they keep coming and squaw stops closing so early.

post #14 of 24

Season pass prices definitely don't make much sense.  As far as I know Stowe is the most expensive pass in the country, which doesn't make sense to me AT ALL

post #15 of 24
Quote:
Originally Posted by JsNeagle View Post

Season pass prices definitely don't make much sense.  As far as I know Stowe is the most expensive pass in the country, which doesn't make sense to me AT ALL


The Goverment is the primary owner (AIG). Would you expect any different?
 

post #16 of 24

Damn i wouldnt pay 350 bucks for a 200 foot hill if a deliverance redneck was gonna run outta the woods and make me squeel like a pig if i didnt buy it. My hill is 900ft vert and passes are 125-150 no blackouts. Also colorado's passes are becoming very competative and priced very nicely.

post #17 of 24



 

Quote:
Originally Posted by snowyphil65 View Post

Damn i wouldnt pay 350 bucks for a 200 foot hill if a deliverance redneck was gonna run outta the woods and make me squeel like a pig if i didnt buy it. My hill is 900ft vert and passes are 125-150 no blackouts. Also colorado's passes are becoming very competative and priced very nicely.


What if you lived in Georgia and most of your free days to ski are Saturday's only.

You do what you have to do, if you are an addict.
 

post #18 of 24
Quote:
Originally Posted by steamboat1 View Post

The Goverment is the primary owner (AIG). Would you expect any different?

 


Not any more, Stowe was sold mid winter... to an AIG 'spin-off' company called Chartis, which AIG formed last summer. I have no idea how that's in anyway legal...

post #19 of 24


Please don't compare Jackson with Breck,Keystone or A-Basin. Not even close terrain wise. 

Quote:
Originally Posted by JimH View Post

It's simple - competition.  Compare these two prices for 09/10 passes in the Rockies:

 

Jackson Hole (no competition) -$1970

Breckenridge/Keystone/A-Basin (lots of competition) - $399


Pass formulas are easy, it involves a dart board a blind fold and a bottle of Jack. 

post #20 of 24
Quote:
Originally Posted by jonrpen View Post



 


What if you lived in Georgia and most of your free days to ski are Saturday's only.

You do what you have to do, if you are an addict.
 

This is a easy one, move to where it snows.   
 

post #21 of 24

Boy, I wish I could.

post #22 of 24



 

Quote:
Originally Posted by SavoirFaire View Post


Wilmot Mountain, a crumby 200 foot high hill in Wisconsin is $345 with no blackout dates. What gives? I can't explain the pricing disparity. Can anyone comment on how this makes any sense?
 


Unfortunately Wilmot and Alpine VAlley are the only close "game" to play in the Chicagloand Area etc.  I got a pass at Cascade Mountain cheaper thatn Wilmot or AV.  I can either drive two hours to AV or three to Cascade and get a lot more.  I wish I lived out west where there were more options!

 


 

post #23 of 24
Quote:
Originally Posted by alexzn View Post

 Don't look for logic.  .  
 
Also, competition in Tahoe is very tough and Hevenly is a good mountain but not great.  Anecdotal evidence is that most locals there ski at Kirkwood and Sierra as the terrain is better there, so Heavenly may want to tie people to its slopes by heavily discounting the pass.  $339 is really cheap, a friend from Boston went to SoLake for a week and it was cheaper for him to buy a pass than pay his lift tickets.  Whatever works.   
 


It's a bit more than anecdotal. IMO half of the people on a given day at Kirkwood are from Southern Tahoe. And an early season pass is only $300 (with Saturday and holiday weekend blackouts-days a local would tend to avoid).
 

post #24 of 24
Quote:
Originally Posted by Ske-Bum View Post

This is a easy one, move to where it snows.   
 

 

Not as easy for those who have multiple addictions. ;-)

 

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