Allison Pohle
Appearances
The Journal.
The Snowballing Problems at Vail Resorts
It depends who you ask. People who have gotten into skiing or who are able to ski more because of the Epic Pass say, they actually made skiing affordable for me. Now I ski all the time and I actually learned how to ski because this pass gave me an incentive to keep getting back out there, even when it was hard. And now I love it and I take my family.
The Journal.
The Snowballing Problems at Vail Resorts
But among a lot of other skiers, there has been this reputation that Vail has made skiing inaccessible by raising the price of the daily lift tickets. So it's harder to go out there and try it and see if you like it when it costs several hundred dollars to do so.
The Journal.
The Snowballing Problems at Vail Resorts
Other people say they're driving up the cost of ski lessons, of eating at the lodge, and have changed the character of these local ski resorts they acquire from being a place where it's the local hill, the mom-and-pop area, where everyone knows each other, to something that's a lot more corporate.
The Journal.
The Snowballing Problems at Vail Resorts
And as it turns out, Vail has pioneered a business model that is now really a victim of its own success.
The Journal.
The Snowballing Problems at Vail Resorts
I do ski. Okay. I learned as an adult, though, so I did not grow up skiing.
The Journal.
The Snowballing Problems at Vail Resorts
I don't. I don't. I try to embody that, though. Like, I have an alter ego when I'm skiing called the Grade A Shredder. And that's me in that persona.
The Journal.
The Snowballing Problems at Vail Resorts
You would go up to the window at a ski resort, buy a lift ticket for the day. They would give you a tag. You would fasten it to the zipper of your jacket.
The Journal.
The Snowballing Problems at Vail Resorts
Yep, and they would have all those tags to show how many times they went. But it left the resorts themselves in a vulnerable position because how many tickets they were able to sell depended on how good the snow was and how good the season was. So if they had a great year, they were able to invest in the resort and make some upgrades.
The Journal.
The Snowballing Problems at Vail Resorts
If it was a bad snow year and they didn't sell a lot of tickets... That was tough, and that meant the next year was going to be difficult in terms of whatever snowmaking equipment or lift upgrades they were able to do.
The Journal.
The Snowballing Problems at Vail Resorts
So what it did was take five Vail-owned resorts and a partnership with one other resort, put them all on one pass, and for the low price of $579, you could ski at any of these six resorts as much as you wanted for the entire season. Uh-huh. Whereas before, if you were buying a season pass, it was for one resort, and it was a lot more expensive.
The Journal.
The Snowballing Problems at Vail Resorts
It could cost over $1,000, even over $1,500 just for one resort. If you're somebody who's skiing 10, 15, 20 days a season, and your pass costs $1,000, $580 total, then your cost per time skiing is going down. So really, if you think about it, you know, you're getting a lot out of the value of the pass.
The Journal.
The Snowballing Problems at Vail Resorts
The main part of their strategy was buying up smaller ski resorts and putting them on the Epic Pass and raising the price of the Epic Pass a little bit along the way. So Vail was really acquiring resorts across the country.
The Journal.
The Snowballing Problems at Vail Resorts
So to just walk up to the window and go ski, it has become exorbitantly expensive, where today in this ski season, 2024, 2025, it will regularly cost over $300 on a holiday weekend at Park City, at Vail, at the most popular resorts, just for the day.
The Journal.
The Snowballing Problems at Vail Resorts
Wall Street loved this for Vail's business, and it was successful. It meant that tens of thousands of people are buying this epic pass before the season starts. So Vail is able to grow their revenue. They're able to have the money to buy more ski resorts, but also to improve the ones that they did buy. So a lot of these resorts were in rough shape before Vail came in.
The Journal.
The Snowballing Problems at Vail Resorts
So Vail was able to come in and spend money to make those upgrades and make the resorts better.
The Journal.
The Snowballing Problems at Vail Resorts
It soon became clear that being outside was great. A lot of people who had never skied before wanted to try it.
The Journal.
The Snowballing Problems at Vail Resorts
Exactly. And all of a sudden it became... very desirable to ski, Vail realized this and thought, okay, great. We are going to cut the price of the Epic Pass. It was the first price drop that they had ever did. They wanted to incentivize a lot of new skiers. So this was before the 2021-2022 season. They cut the price to get more people to commit to this season pass in advance.
The Journal.
The Snowballing Problems at Vail Resorts
I think there's some moguls. I'm not sure what grade it is yet, though. Remains to be seen, but there are some bumps, and we're going over those moguls right now.
The Journal.
The Snowballing Problems at Vail Resorts
But in some ways, this backfired. All of a sudden, these mountains are becoming super crowded because there's no limit on the number of epic passes that are sold. So at this point, you have over 2 million people buying this pass. They don't need to make a reservation. They just show up, and that means there are tons of people trying to ski.
The Journal.
The Snowballing Problems at Vail Resorts
So, on social media, there was a massive backlash.
The Journal.
The Snowballing Problems at Vail Resorts
There were too many people on the mountain. It strained everything. It strained parking around the area. There's nowhere to eat. And there were so many people skiing at Vail Resorts that there became a phenomenon known as the epic lift lines. It just keeps going. It's not 9 o'clock yet.
The Journal.
The Snowballing Problems at Vail Resorts
Vail markets itself as the experience of a lifetime, and it's a premium product. It is a luxury experience where they have created these little mountain villages that are emblematic of what you might see in Switzerland. The trails are immaculately groomed. You have high-speed chairlifts.
The Journal.
The Snowballing Problems at Vail Resorts
It was also just not what they felt they had paid for. So, you know, you've seen the advertising of all these Vail resorts that, you know, there's one skier going down and all of a sudden, you know, you're trying to navigate around 15 people just to take one turn. You're paying a lot of money to go to this place and then you're having a bad time.
The Journal.
The Snowballing Problems at Vail Resorts
So the ski patrol are getting paid a starting wage of around $21 an hour in Park City. And there were signs that they had. They were holding out saying a burger at the dining hall costs $25. And they're saying, look, we can't even afford to have lunch on one hour salary here.
The Journal.
The Snowballing Problems at Vail Resorts
Vail did insist that the mountain was open, that people could go ski there, and the lifts were running. Now, when people got there, that was not the experience that they had. They were extremely frustrated.
The Journal.
The Snowballing Problems at Vail Resorts
I talked to multiple skiers who have spent thousands of dollars to take their family on this vacation and spent it waiting in line or even just gave up and said, you know what, we're going to do something else while we're here. We're not going to stand for over an hour trying to get on the mountain. This is just not worth it.
The Journal.
The Snowballing Problems at Vail Resorts
late Apex Partners is what they're called, published a letter to Vale's board of directors. And in the letter, the shareholder said that Vale's performance over the past five years has been, quote, unacceptable. It even goes on to say that, quote, the core skiing community has labeled Vail the evil empire, end quote.
The Journal.
The Snowballing Problems at Vail Resorts
And in another part, it says that, quote, management's incredibly short-sighted actions have led to lost opportunities and destroyed brand value.
The Journal.
Can Pepsi Make a Comeback?
Welcome to The Journal, our show about money, business, and power. I'm Alison Pohle. It's Friday, April 11th. Coming up on the show, Pepsi lost its way. Can it get back on track? When we think of the soda world, or pop world, as I would say, who are the two main competitors?
The Journal.
Can Pepsi Make a Comeback?
Okay. Pepsi has a long-standing rivalry with Coke, and Coke has always been the top cola in the country. In the 1960s, PepsiCo tried to kick Coca-Cola off the number one pedestal by starting up a competition that would come to be known as the Cola Wars. The company launched a new campaign it called Pepsi Generation.
The Journal.
Can Pepsi Make a Comeback?
Yeah, my mom told me about the Pepsi Challenge when I was younger, and so I had her do it for me. By the 80s, Pepsi was on its way up. In 1985, Coca-Cola responded by launching a product called New Coke, which was a major flop. Meanwhile, PepsiCo was signing million-dollar collaborations with stars like Michael Jackson.
The Journal.
Can Pepsi Make a Comeback?
I recently sat down with my colleague, Laura Cooper, who covers Soda Pop. So, importantly, do you say soda or pop? Soda. I'm from New York. It's all soda to me. I say pop. Where are you from? I'm from Cleveland. I was a big pop drinker growing up. If you're from the Midwest, I'm going to assume probably Pepsi. Yeah, there are a lot of Pepsi products and placements in the Midwest, for sure.
The Journal.
Can Pepsi Make a Comeback?
All this was working for PepsiCo. Pepsi's share of U.S. soda sales peaked in the late 80s and got close to unseating Coke from the number one spot. While PepsiCo was chasing Coke, the company was also looking at ways to expand its business. It wanted to be more than just a soda company. And so it acquired other brands, first snacks and then fast food.
The Journal.
Can Pepsi Make a Comeback?
PepsiCo kept going. In the 2000s, when consumers started to become more health-conscious, the company saw an opportunity. It bought a juice brand, a kombucha brand, and formed a joint venture to sell Sabra Hummus. The company even added energy drinks to its offerings.
The Journal.
Can Pepsi Make a Comeback?
But as PepsiCo was pouring resources into other products, Pepsi-Cola sales had been dipping lower and lower. And then, last year... Now there's a new number two.
The Journal.
Can Pepsi Make a Comeback?
After decades of trying to win the top slot, Pepsi actually slipped even further down. And now the company needs to do something about it. That's after the break.
The Journal.
Can Pepsi Make a Comeback?
It wasn't just Pepsi sales that were dropping. As of last year, beverage sales across PepsiCo's U.S. business were down. With their most prestigious soda in the number three slot, the company told Laura that maybe they'd lost their focus. The man hired to turn those numbers around for Pepsi and for all beverage sales was Ram Krishnan, PepsiCo's new head of beverages in the U.S.,
The Journal.
Can Pepsi Make a Comeback?
One of the big things that came out of Krishnan's work was how the drinks got into stores. And the company did that by leaning on its food business.
The Journal.
Can Pepsi Make a Comeback?
PepsiCo decided to unite their food and beverage distribution operations under the same leadership. Krishnan also wanted to bring more attention back to the company's core product, Pepsi. So he launched a new marketing campaign.
The Journal.
Can Pepsi Make a Comeback?
Pepsi wasn't just a part of my life growing up. There was a time when those classic blue cans were embedded in the American zeitgeist. When would you say Pepsi was at its coolest?
The Journal.
Can Pepsi Make a Comeback?
Krishnan is trying to bring Pepsi back into the mainstream by advertising on TikTok and Instagram. He's also dusted off the Pepsi challenge, this time pitting Pepsi Zero Sugar against Coca-Cola Zero Sugar.
The Journal.
Can Pepsi Make a Comeback?
Krishnan says store sales of classic blue can Pepsi have started to inch up. And that's not all. He says the company has also reversed the decline in Gatorade's market share. His latest move was a deal to acquire prebiotic soda brand Poppy, which is popular among health-conscious soda drinkers and had ads at the Super Bowl this year.
The Journal.
Can Pepsi Make a Comeback?
And even some of Pepsi's most stalwart champions have fallen away, like Britney Spears.
The Journal.
Can Pepsi Make a Comeback?
But today, the magic of Pepsi seems to have fizzled. Pepsi, which has almost always been the number two cola in America after Coke, dropped to number three behind Dr. Pepper last year. And now, PepsiCo is reckoning with the fact that Pepsi might not be as cool anymore.