BROOMFIELD, Colorado—Hotel properties in some of the world’s most popular ski towns flourish during holiday periods.
These destinations are unique in the hotel industry, as rates can swing $1,000 from a slow May period to a high December.
Christmas week is the first major ski holiday, setting the tone for the rest of the season. STR Analytics, sister company of Hotel News Now, has shown previously that snowfall amounts have minimal impact on hotel demand. With that piece out of this analysis, we looked at average daily rates and how the day of the week on which Christmas falls can impact pricing behavior.
For the purpose of this article, we analyzed three of the world’s best ski towns, as rated by National Geographic. The following charts were created to show ADR performance, with the thickness of the line representing the relative occupancy level. The thicker the line, the higher the occupancy was that day.
Aspen, Colorado, is one of the most popular ski towns in the United States. The chart below shows the end of the 2012/2013 ski season and start of the 2013/2014 ski season. High rates between $500 and $800 are achieved in January, February and March, but December stands far above the rest.
New Year’s Eve attained the peak rate for the third consecutive year. While the metric climbed to $1,858 in 2013, it was down 12.3% from New Year’s Eve 2012. This is likely due to the holiday falling midweek in 2013.
Demand on 31 December 2013 was relatively flat compared to 2012 with growth of only 2.2%. (Although with an occupancy level of 97.9%, there isn’t significant room to grow.)
Click chart to enlarge.
The timing of Christmas during 2013 had a significant impact on pricing during the period between 25 December 2013 and 2 January 2014. With the national holiday falling on a Wednesday, more travelers were inclined to extend their vacation into the shoulder days rather than just book Friday and Saturday nights. Thus, there were six days in that nine-day span where ADR exceeded $1,000 compared to only three days in 2012 and 2011. Christmas fell on Tuesday in 2012 and Sunday in 2011.
Overall for this nine-day period in 2013, ADR was $1,212 and occupancy was 95.7%. This equates to a 13.8% increase in ADR and 5.7% increase in demand from the same nine-day period in 2012.
Click chart to enlarge.
The rate disparity among ski season months in Park City, Utah, is far less than Aspen. New Year’s Eve still saw the year’s peak ADR at $828, an increase of 6.8% from the previous year. In the previous season, ADR spiked around the middle of January and the middle of February, most likely related to Martin Luther King Jr. Day and Presidents Day, where rates were approximately $700.
Click chart to enlarge.
Jackson, Wyoming, and the surrounding area of Teton Village, follows a similar trend of Park City, albeit with a lower average rate. The December trend in this city is more consistent during the Christmas week period, perhaps due to travelers making longer trips. Also, it’s worth noting that 30 December was the peak ADR night, which differs from the previous two towns.
Click chart to enlarge.
Stay tuned to see how the rest of the ski season plays out for the hotel industry.