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« Previous Story | The Industry Report Home Page | Next Story » The Good Old Summer Time That Wasn't; But, Was It Habit Forming?By Roger Leo 
The result was a reported average drop in July bookings of 13 percent, and drop in July revenues of 11 percent, compared with a year ago, with the impact falling unevenly across the spectrum of destinations. Looming out there is the big question of what will winter bring, and what strategy will yield economic success? Julie Maurer, vice-president for marketing and sales for Booth Creek Resorts, told The Industry Report that Northstar at Tahoe bases summer business on lodging, 18-hole golf course, mountain bike and hiking park, the Village at Northstar with shops and restaurants, and a menu of special events through the summer. "In terms of our overnight business, we're slightly ahead of last year and consider that to be pretty good," Maurer said. She attributed that to a marketing decision a year ago to go after wedding and reunion business in aggressive fashion, and to the 11 million people who live within easy drive. Even though business is robust, Maurer said, guests have cut back on spending. "We're doing fine with food and beverage, but retail is off," she said. "We're feeling very positive about the summer, but don't know what's to come this winter," Maurer said. Elsewhere weather played a significant role in the heartiness of "nearcation" business over the summer. Bonnie MacPherson of Okemo Mountain Resort in Vermont said, "Business has certainly been weather-dependent. The start of summer was pretty slow, but since the weather turned more positive in August it's been gangbusters. Golf rounds are way up, to the point where it's hard to get a tee time." Other resorts were nimble with deals to take advantage of an apparent pent-up demand for recreation close to home once early summer rains let up in the Northeast. Guests everywhere continued to book close to arrival, and to stay close to home. Maurer said, "We are definitely seeing the close-in booking, not for weddings or family reunions, but for other travel. The conference and meeting business, which had been deader than a doornail, is now showing some life. The positive news is that we do have more meetings and conferences, but they're booking so close in that it's mind-blowing." That is bad from the vantage of resorts, but for consumers the strategy of waiting until the last minute, and looking for discounts, has paid off in terms of price and choice. It's going to be a tough habit to break. MacPherson said guests have gotten used to making last-minute bookings, and getting significant discounts. "We've rewarded that behavior and I don't know how easy it will be to change it. It might be like shoveling sand against the tide, but henceforth we're going to be rewarding people for booking early, and rewarding them for booking mid-week. We'll be trying to drive that business to midweek with pretty good discounts, 15 percent below last season, with added value if people book a multiday stay midweek," she said. None of the dismal news should be surprising, given the state of the economy. What may be alarming is the broad sweep of the downturn in travel and spending, including Alaskan cruises, well off this season and expected to continue down 14 percent in 2010; Las Vegas visits, down 200,000 this June over last despite room discounts of more than 25 percent; a drop in business around Vancouver, where foreign visitors stayed away and locals picked up some of the slack - at discount - in rooms but not in spending. Winter season numbers from some of the prime warm weather destinations, just coming out, also show significant downturn: South Florida hotel operators say the bottom fell out of their business last winter, with no end in sight; visits to the Hawaiian islands over primetime January and February were down double digits over the previous year. Observers say guests are responding to discount offers and value-added promotions, but are arriving on a tight budget, and are not spending as much money on vacation as in past years. Why? You know why. No need to belabor it. What It Means Resorts will survive the downtown by paring costs where possible without affecting operations and quality of service, by offering guests good value at fair price, significantly raising the bar in terms of customer service, and not falling prey to fear and the bad decisions fear can produce. Bad times have hit the resort industry in the past, and resorts have endured. Now, perhaps it's time for some optimism. It can't hurt. « Previous Story | The Industry Report Home Page | Next Story » |
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