With revenues taking a hit this winter as Whistler feels the impacts of a global economic recession, Tourism Whistler’s board of directors made a decision to increase member assessments by two per cent this year to make up for the shortfall.
While Tourism Whistler president and CEO Barrett Fisher says it was a difficult decision with local businesses facing hard times and property taxes going up, the board — representing hotels, Whistler Blackcomb, the municipality and other businesses — agreed that now was not the time to cut back on sales and marketing.
“(The board) unanimously believes that we’ve got the single largest opportunity facing us when it comes to the Olympic Games… and they clearly want to grow our marketing and sales investment and leverage the opportunities to make sure that come 2011 we feel strongly that we put our best foot forward,” Fisher said. “Although businesses are struggling in the short term there was a strong consensus that this was critical.”
Tourism Whistler and board members also feel that aggressive sales and marketing is helping to mitigate the impacts of the economic downturn and poor snow at a time when there is a lot of competition among resort destinations for customers.
At the start of the season Tourism Whistler forecast a 12 per cent decline in room nights, but long-term bookings showed a decline of closer to 20 per cent. However, with last minute bookings Whistler hotels have only been off by about 10 per cent compared to last season, which was a very good year for the resort.
While significant, Fisher says that it’s better than other resorts are faring.
“Year to date, compared to our competitors, we actually believe we’re faring better than the global average,” said Fisher.
But while visitor numbers are not off as much as they could be, Tourism Whistler expects to take a hit, as they get almost a third of their funding from hotel taxes, corporate sponsorship, and operations like the Whistler Golf Course and Telus Whistler Conference Centre.
And while hotel visits are down 10 per cent, Fisher also says the price of rooms is also down by an average of four per cent so far, which translates to a further loss of revenues. Hence the two per cent increase in member fees.
“On an individual basis it’s not going to be a major hardship, but when you take 7,000 members and add up the assessment increase it does create a bit of a pool to drive sales and marketing,” said Fisher.
Putting that two per cent increase into perspective, Fisher says a 1,000 square foot retail space would pay an additional $30 over last year’s assessment, while a two-bedroom condo would see an increase of about $20.
The number of new businesses and condo spaces — such as Evolution in Creekside — paying Tourism Whistler fees will also help offset lost hotel tax revenues. As well, Tourism Whistler took steps to streamline its operations and cut its own operating costs in order to put more money into sales and marketing.
Tourism Whistler does not release its budget for competitive reasons, but Fisher says they’ve cut all non-essential expenses in order to increase their sales and marketing budget over last year. In a typical season, Tourism Whistler would have an early season ad campaign, another campaign in mid-winter, and another for the spring. This year they have marketed the resort continuously.
Media relations has also been bumped up, hosting more media in advance of the 2010 Games. Last year they hoped to attract 450 media representatives, and succeeded in bringing more than 700 media representatives to town.
Tourism Whistler has also refocused its marketing on core markets like skiers, golfers and mountain bikers, pushing back investment in new health and wellness and arts and culture events.
“Typically in a tough economic year… is not a time when you are increasing new products and trying to grow awareness of new products,” Fisher explained. “It can take three to five years to ramp up a new product, so in order to get the highest and greatest returns in a challenging year we have chosen to focus on loyal customers, high awareness customers… our loyal and repeat visitors.
“Our research told us we would see a decrease from overseas and long haul U.S. markets, which has proven accurate. And so there’s a greater focus on trying to attract our regional market, the core skiers, the core mountain bikers and golfers.”
Fisher says they are not withdrawing support from proven events, but have made a short-term decision to focus on traditional markets. The long-term plan still includes health and wellness, and arts and culture — both of which have been identified as areas where Whistler can grow visitor numbers in the future.
“That might be a 2010-2011 strategy instead of a 2008-2009 strategy,” said Fisher. “While tactics might change in the short term to adapt to the changing environment, and it’s changing, we will continue to be true to our long-term strategy.”