Winter booking at western mountain resorts has slowed for the first time in more than three years, according to the latest data from DestiMetrics.
In its monthly Mountain Market Briefing, DestiMetrics reports a slight reversal in a multi-year trend of nearly consecutive year-over-year increases in bookings and revenues. While as of Sept. 30 actual aggregated occupancy for the month of September was up 14.9 percent and revenues were up 22.7 percent, the booking pace during the month for the upcoming winter actually dipped 2.3 percent compared to the same time last year.
As of Sept. 30, aggregated on-the-books occupancy for arrivals from November through March is down 1.1 percent compared to the same time last year but increases in the Average Daily Rate (ADR) are offsetting some of that loss as revenues are up 2.1 percent for the same period. The report also revealed that November and December are both gaining but the rest of the winter months are showing declines. Data that includes April 2016 will be available starting next month and will provide a more complete picture of the full winter season.
“The decrease in the winter booking pace is the first such reversal of momentum in several years and is a little surprising because the industry is coming off the best summer ever for mountain destinations with overall occupancy up more than seven percent and revenues up more than 11 percent for the six-month period of May-October,” explained Ralf Garrison, director of DestiMetrics. “And while it is still quite early in the booking season and the numbers are still relatively small, we’ll be monitoring both ‘econometrics’ and weather patterns in the next few weeks to see how they might change bookings patterns-for better or worse,” he continued.
Stock market declines taking their toll?
Major economic indicators were cited as possible factors in the slower booking pace. Although the Consumer Confidence Index (CCI) increased for the second consecutive month and reached it second highest level since 2007 at 103 points, that optimism was tempered by the second consecutive monthly decline in the Dow Jones Industrial Average. The volatile Chinese economy and threat of a global slowdown kept the market mercurial throughout the month. The National Unemployment Rate was unchanged at 5.1 percent with only 142,000 new jobs created during the month.
“The anemic number of jobs created last month may indicate growing market concern about a global economic slowdown and this is a real worry,” says Tom Foley, operations director for DestiMetrics. ““Job creation and earnings are the largest influencing factor for consumer spending and a prolonged period of reduced job creation or a slowing in earnings growth may impact discretionary consumer spending, including travel,” cautioned Foley.
While the economy was cited as at least a partial explanation for the modest cooling in bookings, the report also acknowledge the role of recent warm temperatures on the pause in early booking patterns.
“Ironically, the exceptional weather in the Rockies and Far West mountain resorts that extended the summer season and contributed to this record-breaking summer, is now a possible factor for the slowing in winter bookings,” offered Garrison. “Regardless of the reason, this unexpected dip in winter bookings marks a pattern shift that has on alert for variables that could impact the coming season and anticipating possible adjustments to the game plan,” he concluded.
*DestiMetrics tracks resort performance in mountain destinations, compiling forward-looking reservation data on a monthly basis and aggregating and reporting the results to subscribers at participating resorts. Data for western resorts is derived from a sample of approximately 290 property management companies in 19 mountain destination communities, representing approximately 27,500 rooms across Colorado, Utah, California, Nevada, Oregon and Wyoming and may not reflect the entire mountain destination travel industry. Results may vary significantly among/between resorts and participating properties.
