Are lift tickets too cheap? (Article)

[Nick]

http://www.saminfo.com/blog/what-if-we-aren’t-charging-enough-lift-tickets-and-skiing

I think there are some major flaws in the comparison this article draws but it's an interesting read none the less. The author makes a comparison between Disney and Skiing and ponders whether lift tickets are underpriced.

 

[spring_mountain_high]

they can only charge what the market will bear

 

[jimmywilson69]

without reading the article


NO!!!!

 

[Nick]

they can only charge what the market will bear

My thoughts exactly. Maybe the article was just trying to create some controversy and I"m no pro for sure but I do have a hunch that increasing prices by any "significant" number would definitely drive down attendance in a way that would be negative revenue wise.

Side thought: I wonder if the growth in BC skiing is a result of current ticket price growth.

 

[Cannonball]

I've been thinking about this lately. In a lot of respects you get a lot of product for the price of a ticket. There's a ton of infrastructure involved in just the basics of providing good conditions and carrying you up the hill. Anyone who's earned their turns knows can appreciate that value.

So I think the bigger question is: "are they charging money in the right ways?" It seems to me that the model of full-day tickets might not be the best. The pay-per-run model seems better to me. For consumers you have the option of paying for exactly as much product as you want. Feel like another run? Great, it'll cost you $6 (or something). For the resorts you may get customers to show up and either spend just as much as a full ticket, or show up and spend a little bit, which is more than you would have got if they stayed at home not wanting to shell out for a full ticket. Implementation of this model has always been a challenge. But that is just a matter of finding a practical method.

 

[4aprice]

I've been thinking about this lately. In a lot of respects you get a lot of product for the price of a ticket. There's a ton of infrastructure involved in just the basics of providing good conditions and carrying you up the hill. Anyone who's earned their turns knows can appreciate that value.

So I think the bigger question is: "are they charging money in the right ways?" It seems to me that the model of full-day tickets might not be the best. The pay-per-run model seems better to me. For consumers you have the option of paying for exactly as much product as you want. Feel like another run? Great, it'll cost you $6 (or something). For the resorts you may get customers to show up and either spend just as much as a full ticket, or show up and spend a little bit, which is more than you would have got if they stayed at home not wanting to shell out for a full ticket. Implementation of this model has always been a challenge. But that is just a matter of finding a practical method.

Now there's an interesting thought; EZ Pass for skiing.

Alex

Lake Hopatcong, NJ

 

[SIKSKIER]

Easy enough to do with the rfid gates.

 

[spring_mountain_high]

i'm pretty sure it is out west, but i also imagine the for the bigger places in the east, the lift ticket is the 'loss leader' that gets you there, then maybe you stay in a condo, eat at the restaurant and drink at the bar

 

[Smellytele]

i'm pretty sure it is out west, but i also imagine the for the bigger places in the east, the lift ticket is the 'loss leader' that gets you there, then maybe you stay in a condo, eat at the restaurant and drink at the bar

I am not one of the ski areas targets because I never stay on mountain, I bring my own food usually even out west and rarely drink their booze.

 

[Domeskier]

"Just looking at what we have here, Disneyland is raising their prices faster and growing their visitation faster than skiing. Let me say that again, Disneyland is looking for the same families that skiing is and they are growing faster than skiing either because of, or inspite of, exponential growth in ticket prices."

I'm curious whether the author is just joking when he posits the possibility that there is a causal relationship between the rise in tickets prices and the increase in visitors. The demand for some goods can increase when their prices increase, but that is generally because production is decreased and they become more scarce. I sincerely doubt that the reason more people are visting Disneyland is because they raised the cost of tickets. This is not to say that an increase in ticket prices could not lead to an increase in revenue. That is a reasonable hypothesis. But the notion that an increase in ticket prices would directly cause an increase in visitors is absurd.

 

[deadheadskier]

I believe there is a direct linear relationship between amusement park attendance and the BMI of the population.

 

[Nick]

I believe there is a direct linear relationship between amusement park attendance and the BMI of the population.

Like a Cruise ship

 

[Savemeasammy]

This article did not pop up on my phone, but did the article discuss the fact that Disney for most is a once-in-a-lifetime trip, versus skiing which is done multiple times per season over a number of years?

 

[ScottySkis]

Skiing beats Disney hands down.

 

[Huck_It_Baby]

Skiing beats Disney hands down.

I'm glad my parents bought me my first pair of skis as a little kid and NEVER took me to disneyland.

 

[Smellytele]

I'm glad my parents bought me my first pair of skis as a little kid and NEVER took me to disneyland.

My parents did both and I enjoy(ed) both.

 

[timm]

"We should at least consider the data" = here is a bunch of meaningless data thrown at the wall in a slipshod and incoherent fashion in an attempt to be contrarian.

1) Visiting Disney has no additional intrinsic costs associated with a visit. Skiing has significant financial barriers to entry in this area.

2) Disney is in a totally different business and has a brand that no ski resort is ever going to approximate.

3) "annual skier visits divided by 5 to match the scale of Disneyland" - why divided by five? The maximum capacity of the two Disney resorts is just under 200,000 people. Is the maximum capacity of all ski resorts in really 1,000,000 skiers (really, I am asking)?

4) Using (presumably, he does not say) median lift ticket price across all of New England is absurd. New England has lower ticket prices on average than the West (often significantly). But worse, using any kind of aggregate price at all does not make any sense. If you want to compare a Killington or Vail business model to Disney, that is tenuous but may have SOME value. But there are few true destination resorts in the ski industry and many more small mountains. An accurate comparison would have to include all "amusement parks" - including all of small Storybook Land type places, which would yield a much different result.

5) I doubt much of Disney's business model is based on regular repeat customers. I assume most people go to Disney once or twice in a life time.

etc.

 

[Huck_It_Baby]

My parents did both and I enjoy(ed) both.

Never had the desire to go to Disney even as a young boy. I'm sure I would have had fun though.

 

[Nick]

This article did not pop up on my phone, but did the article discuss the fact that Disney for most is a once-in-a-lifetime trip, versus skiing which is done multiple times per season over a number of years?

My first thought also but I guess Disney sells "season passes" as well and apparently it's a large portion of their income.

My sister in law went to Disney with her five year old three times this year (!)

 

[HD333]

"
5) I doubt much of Disney's business model is based on regular repeat customers. I assume most people go to Disney once or twice in a life time.

etc.

You would be surprised.

We have some friends who go to Disney at least twice a year, yes at least twice a year, sometimes with a Disney Cruise thrown in. I don't get it, once every 2 years is more than enough for me.

I don't get it, but I know for a fact these same friends cannot comprehend that we basically disappear from Late Nov to Early April each year.

Last time we went Disney did their best to try to make us a repeat customer, free upgrade to some club level at hotel (the free booze was nice), basically any restaurant reservation we wanted through that upgrade. It was nice but it didn't work.