Case Study: The Value of Offering Rentals

Do you remember the first time you went skiing or snowboarding? Unless you had a friend or family member with an extra pair of skis lying around, you probably had to pick up some rentals before heading to the slopes. Liftopia encourages resort partners to offer products that include both a lift ticket and a rental not only for customer convenience but also as a significant driver of e-commerce revenue. But just how valuable are lift + rental bundles to an individual resort?

The data in this study was collected by comparing sales from Liftopia partners who offered date-specific lift tickets and lift ticket + rental bundles over the last two seasons. For each resort partner, revenue from lift ticket + rental bundles were broken out from standalone lift tickets to determine the total increase in revenue from the rental bundles. The results were grouped by resort size (determined by annual skier visits) and region.

Results by Size (Annual Skier Visits):
The data shows that rental bundles produce more revenue for partners with fewer skier visits than larger resorts. This is likely attributed to smaller resorts attracting budget-conscious or beginning skiers who often don’t own their equipment. Conversely, larger resorts tend to attract experienced skiers who own their own gear and are looking for a more complete skiing experience.

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Results by Region:
Rental bundles performed best in regions that don’t typically stand out as being ski destinations. For example, resorts in the Midwest and Southeast attract fewer destination skiers on average than the Mountain West and Northeast. Regions like the Mountain West (Utah, Colorado, Wyoming, Idaho, Montana), and Northwest (Oregon, Washington, and Western Canada) tend to attract a more seasoned skier who may already own ski gear. A resort in a non-destination region is more likely to attract a local customer who may be a casual or first-time skier in need of equipment rentals.

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Case Studies:
To further exemplify the value of offering lift and rental bundles, two case studies have been provided below. The following examples were controlled for by size and have similar pricing strategies.

Incremental Revenue from Adding Lift + Rental Bundles
During the 2015-2016 season, a small ski resort in the Northeast offered lift tickets at limited discounts and earned $0.19 per skier visit. The next year they applied a similar pricing strategy for lift tickets but added rental bundles to their product mix. They earned the same revenue per skier visit of $0.19, but they also collected an additional $0.24 per skier visit from lift and rental packages. They more than doubled their revenue by adding rentals.

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Benefit of Offering Rental Bundles in the Northeast Region
This example looks at two comparable ski resorts in the Northeast that are within a 90-minute drive from one another. Each receives between 40,000 and 60,000 skier visits annually, and both had a similar lift ticket pricing strategy during the 2016-2017 season. Resort A only offered lift tickets, while Resort B offered both lift tickets and rentals. Resort A collected $2.85 for each skier visit that season. Resort B earned $2.33 per skier visit from lift ticket sales and an additional $1.41 per skier visit from lift and rental bundles, increasing their total revenue by 60%.

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In order to ski, one needs equipment, and not every potential customer owns their own. There are many places to rent skis and boards – in the cities where your customers live or even the ski shop down the street from your resort. Liftopia would argue that by offering bundled lift and rental products for advance purchase online, you have the opportunity to capture that spend and provide your customers with the best possible experience when they arrive at your resort.

Back to the original question: How valuable are lift and rental bundles to an individual resort? Over the last two seasons, Liftopia’s partners who offered bundles increased their revenue by an average of 43%. At the top end, some resorts boosted their revenue by over 200%! The data shows that rental bundles offer a unique revenue opportunity that can vary depending on a number of distinguishing characteristics, the most important being resort size and location. No matter how you slice it, it makes good sense to offer rental bundles when selling online.

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