“Although the booking trend appears to be consistent with last winter’s pattern, there is still some evidence that consumers are slightly more upbeat about future prospects,” said Ralf Garrison, author of the monthly report that tracks data from a sample of 216 property management companies in 15 mountain destination communities across Colorado, Utah, California, and British Columbia. “Even though economic fundamentals remain bleak, economic indicators have been edging upwards for the past several months and seem to be generating some optimism in the future — and consumer confidence is the foundation for spending behavior which could lead to a self-fulfilling reality with increased spending that would further drive the economy upward."
A bright spot in the research showed that reservations made in May for arrival in May through October was up 9.3 percent. Even though volume is low, the increase is a refreshing change and the first positive indicator in many months. However, the six-month forecast shows occupancy is currently down 20 percent and room rates are down 10 percent for the summer/early fall.
Garrison’s cautious optimism stems from the positive uptick in the Consumer Confidence Index (CCI) which has risen four times in the past seven months and posted dramatic increases in the past three months. The Index has risen from an all-time record low of 25.0 points in February to 54.9 points by the end of May, an increase of 119.6 percent.
Garrison speculates that the increase can be partially attributed to the rise of the Dow Jones Industrial Average (DJIA), the most visible and recognizable of the major economic indicators for most consumers. The Dow has risen 676 points (8.52 percent) from early February to mid-June and Garrison believes that a combination of bad news “fatigue” and the slow, steady, and sustained increases in the Dow have given consumers cause for optimism.
“The Dow is often a leading indicator of the broader economy six months in the future, and provides a glimmer of insight into what the mountain travel industry can expect on the economic front this fall when prospective destination skiers and snowboarders are contemplating a winter vacation,” he added.
The report further reported that consumers remain cautious and vacation travel continues to be soft. Typical summer travel patterns for mountain visitors include more “road trips” nearer to home, bookings made closer to travel time, and more affordable pricing than winter vacations. As a result, “summer vacations may be a good fit for budget-conscious travelers and perhaps an easier sell as a result,” says Garrison.
“While economic conditions and reservation activity is replaying the same song as last winter, there appears to be an increase in consumer optimism that may translate into increased bookings if a positive mindset about the economy is sustained and resorts can seize the opportunity,” said Garrison. “In the meantime, travelers can keep taking advantage of attractive rates and promotions as mountain destinations react to the needs and expectations of potential visitors.”
