Article Series 3
Week 1: Dynamics Impacting Resort Communities
Forces at Play 2022:
First in a 9 Part Series from The Insight Collective
By Brian London, Tom Foley, Susan Rubin-Stewart for The Insights Collective
It was easy to miss, but from February 2020 to the following April, the U.S. economy was in a deep decline. Most indicators have returned to pre-recession levels. Some have lagged. Over the past 16 months The Insights Collective has been able to review the data to determine how and why some destination resort communities will continue to excel while others will fade in relevance.
The way we think about recovery is with the letter ‘K’. A K-shaped recovery occurs when, following a recession, different parts of the economy recover at different rates, times, or magnitudes. In our view, influencers for recovery include:
new technologies replacing older technologies
sector-specific impacts that may have longer-lasting effects
The notion of a K-Shaped recovery first gained momentum during the first coronavirus wave in 2020. The idea was that some industries, and people, would do well during and after a worldwide pandemic while other industries – and people – will be worse off. From March 2020 to November 2021, the total wealth of billionaires increased more than $5 trillion, while at the same time more than 160 million people were pushed into poverty.
New Technologies Replacing Older Technologies
How fast is the world moving? Consider how quickly e-commerce has replaced physical channels. Laggards are those unable to offer a technological alternative to an in-person experience, or transaction. Leaders are those that have changed with the times.
The ski industry is hampered not so much by being unable to keep up with modern technology, but by the fact that much of its operations are not easily modernized. While many resorts are moving to automate ticketing using remote kiosks, QR codes, and RFID tracking, not to mention the significant strategic shift to pre-sold season passes, on-mountain operations and the sheer physicality of lifting humans up a mountain are difficult to advance beyond increasing speed. It is important to note that customers compare experiences, and the ease of which technology is integrated across all other interactions. For the traveler that can book air-travel on their phone, pass through security using their phone, grab a ride from the airport using their phone, and in a growing number of cases, check into their room using their phone as a keycard, the ski experience can often be lacking.
As the ski market turns to the next generation of travelers, they will also do well to remember Generation Z, the most recent to have been named, includes 67 million who will not remember a time before smartphones.
The accelerated digital transformation means today’s traveler is more tech-savvy than ever. They do not seek person-to-person service encounters, especially when self-service options are available.
Besides, resort operators do not want payroll increases; they want payroll savings. But is that realistic? While the travel industry in general has widespread issues related to how it is perceived – either correctly or not – to treat its workers, the ski industry and destination resort travel as a whole needs to be particularly focused on finding solutions. But the factors at play are outside the purview of any one entity. Ski resorts inhabit some of the most expensive real estate on the continent, and the recent in-migration to these towns from urban areas has driven a real estate boom that ha simultaneously shrunk affordable workforce rental housing and driven purchase prices beyond anything within grasp of a 15 dollar per hour worker. The incentive for workers to stay – if it’s even an option – has shrunk dramatically since February 2020, as has the definition of job satisfaction and work/life balance. Communities and owner-operators have a huge strategic and tactical challenge in front of them to find a holistic solution that keeps the lights on.
The Two Recoveries
The ability to implement a technology alternative to an in-person service encounter is the leading indicator of post-recession success. Efficiency is not without consequence. For example, contact centers that had not already started a home-based agent program were crippled when the pandemic started, and everyone had to stay at home. Those that had already adopted the technology and put business processes in place were able to expand to all agents more easily. Contact centers that created temporary solutions and did not culturally embrace the work from home movement during the pandemic cannot compete for employees with those that are hiring for remote positions.
Finally, the rush to greater profits must come with an appreciation for the land, resources, and community which are impacted by a ‘return to normal’. Without safeguards in place, unchecked private sector growth will come at the expense of quality of life for residents of
About The Insights Collective
The Insights Collective is a not-for-profit collaboration of destination travel industry experts working together with mountain resort community stakeholders to understand, plan, and navigate the pandemic-influenced economy and its many unintended consequences