Deer Valley, Alterra CEOs Field Questions on Season Pass Price Increases at Lecture
While Vail Resorts has announced that it will discount the prices on all of its ski season pass products next winter, Deer Valley is forging ahead with a price increase on its passes.
The topic was discussed in detail at Monday night’s annual Leadership Park City lecture, which was headlined by Alterra Mountain Company CEO Rusty Gregory and Deer Valley CEO Jeremy Levitt.
Alterra acquired Deer Valley in the summer of 2017 and brought a new marketing model. The Park City destination joined other large mountain resorts like Solitude, Winter Park and Squaw Valley Alpine Meadows by offering expanded season pass sales.
With 15 mountain operations and about 30,000 employees, Gregory said it's tricky to preserve each resort's unique cultural qualities under the umbrella of the parent corporation.
“Alterra Mountain Company is very young, and it has a very young culture,” he said. “Our vision is to be one company with many unique brands building a global mountain community. ... So, we're trying to get the best of both worlds.
“We believe that the platform that is Alterra, and that is the IKON pass, the way we can bind the companies together, is a way to really help our individual resorts and the brands that they represent have been for years, to actually become more themselves, not to be a piece of Alterra except for in the back of the house,” he said.
Park City Leadership Executive Director Myles Rademan said the local audience listening wanted to understand why Deer Valley raised season pass prices for senior citizens.
"Eighty-five percent of the questions that came in dealt with the whole senior pass issue,” Rademan said. “That's the elephant in the room.”
Levitt responded by citing research showing that many resorts had done away with senior season passes. He noted that the decision to discount senior passes by 25% off an adult pass is in line with other resorts.
“We did not make this decision lightly, and a lot of discussion and research went into the change. The reality is that the standard industry rate for senior pass holders is 20 to 25% off whatever the adult season pass rate is, and I know it's tough to hear, but the new price fairly reflects the value of a seven-day pass, unrestricted access."
Rademan pressed Levitt and explained the concerns he has heard from the community.
“Are you turning your back on the long-term supporters in a sense, who have supported you through thick and thin, over 25 or 30 years,” asked Rademan. “And is there anything that you're not doing for the locals that you should be doing for them?"
Levitt said the resort still offers a local's pass.
"So, we still have a local's pass that's a five-pack product that comes at a discount to the lift ticket,” Levitt said. “Sixty percent of our season pass holders don't even have Utah addresses attached to them. Look, we love our locals, support our locals. We're just a business, and when you run a business that's seasonal, cyclical, capital-intensive, labor-intensive, and you have 90 days to make 150% of your annual profit, certain things have to be done."
Alterra's Rusty Gregory said resorts across the organization adjust pass prices regularly.
"If it's not the right price, the market will tell us,” he said. “You know the people will be incensed enough, not that this is our intention, you know, that they won't buy tickets. And we don't want to lose the patronage. So pricing is dynamic. We set prices, and when they're wrong, we'll change them, and if they're right, we'll keep to them. And it's a way of allocating scarce resources."
Gregory said resort managers have a tough balancing act between guest satisfaction, capital investments, employees, and local communities.
"Then the question is, what do we do about it,” he said. “The answer is, I don't think we know yet. Otherwise, we would have done it. But as we go into next year, for pricing, and understand how pricing that we're putting in place next year affects people, it'll evolve over time, and we'll continue to try to get it as close as we can."