A Closer Look at Zermatt
by Dave Riley, CEO Telluride Ski and Golf
Apr 30, 2009 | 1258 views | 0 0 comments | 10 10 recommendations | email to a friend | print
GUEST COMMENTARY How Hotbeds Support a Community

In January, I had the pleasure of speaking at the International Tourism Symposium in Zermatt, Switzerland. The topic I was asked to present on was “branding and the new internet.” This was a good reason to go to Zermatt, but I was especially interested in learning more about this famous alpine community at the foot of the Matterhorn.

Attending the symposium were municipal tourism directors, hoteliers, elected officials, ski area owners/operators, and the regional media representing many European alpine destinations. This allowed me to meet and interview many interesting and knowledgeable people.

For example, I meet the mayor of Zermatt, Christoph Burgin, at his historic office in the centuries-old village, and talked about their community, economy and environment. I also had the pleasure of meeting with Christen Baumann, the ski area CEO of Zermatt at dinner one evening.

I also interviewed small business owners, visitors and front-line employees. For example, I had a wonderful conversation with a 70-year-old lady who owns a small store where she sells very nice wool sweaters, hats and socks that she knits herself. The store has been operated successfully for generations. I met another lady who serves food, as a career, in a local restaurant called Whymper, named after the British man that first climbed the north side of the Matterhorn in 1865. I visited with hotel owners that have operated properties that have been in the family for over 200 years.

These conversations helped me understand more about the sustainability of Zermatt, and how we might address issues in Telluride and Mountain Village.

First, I want to clarify that I am not advocating that Telluride and/or Mountain Village try to become Zermatt. We are our own place. I also realize that each alpine community around the world has differences such as transportation infrastructure, market demographics, geography, politics, etc. But I do believe we can learn from other alpine communities such as Zermatt. It is in that spirit that I share the following information.

Zermatt is a beautiful, compact, alpine community with very strong year-round international tourism. The village is car-free, although a road does exist for limited transport of goods and services from down-valley. A cog-rail train is used to access the small village.

Horse drawn sleighs and carriages, as well as small electric taxis and vans zip around the streets all hours. The one shuttle bus that runs back and forth from one end of town to the other is electric.

Zermatt occupies a small footprint, which looks about the same size as the town of Telluride, but the village has far more hotel/chalet units. The buildings are beautiful. New construction is carefully managed to protect the architectural theme of the village. The narrow streets are in perfect shape and the town is extraordinarily clean and well maintained. There are no sidewalks, as pedestrians simply walk or bicycle in the narrow streets without cars parked everywhere.

Europeans are comfortable with density. The hotels and chalets are mostly five to eight stories, and are close together. Hotel rooms are smaller, restaurants have more seats per square foot, and retail shops have fewer square feet on average than what we are accustomed to in our resorts. Several parks and a river walk are provided for public gathering.

Over 114 retail stores and 105 restaurants/bars line the narrow pedestrian-filled streets. Stores are open from 9 a.m. to noon; they close for a three-hour break, and then reopen from 3 p.m. to 8 p.m. or 9 p.m. A mix of international visitors is apparent.

The shops are very diverse in their offering. This kind of retail “casting” creates interest in the core and a vibrant evening crowd in the streets. Storefronts often have attractive awnings, displays, lighting, and the managers bring their goods out in front of the windows each day. There is a wide variety of excellent restaurants and bars.

Hotels and chalets range from two to five star ratings but most are four-star. Approximately 13,250 beds are hot (available for public rental); 2,283 beds are cold (2nd homes, condos, chalets); and 5,048 beds are used for full time locals and employees in Zermatt. So 89 percent of the beds are “hot.”

You can compare that to a little over 3,400 public rental beds in the Town of Telluride and approximately 1,900 in Mountain Village. The hot bed percentage in Telluride and Mountain Village is less than 40 percent. So one of the big differences about Zermatt from an economic sustainability point-of-view is that the ratio of hot beds to cold beds is far better than what Telluride and Mountain Village experiences.

Four primary owners hold most of the private land in the dead-end, north facing, mountain valley of Zermatt. These land owners are in the hotel business and have an agrarian background. For the past several generations, they have resisted the temptation to sell raw land or hotels to people who want to develop units or convert existing hotels and chalets into cold beds. This is essentially a cultural phenomenon. The people of Zermatt understand the importance of tourism, take it very seriously, and protect the things that make it work.

When I asked Mayor Burgin about the cold bed to hot bed ratio, he looked at me (like I was a crazy American) and chuckled. He knew what I was getting at and was proud to tell me that they have a low percentage of cold beds which helps create the vibrant atmosphere and successful village. “It all leads to better restaurants, shops, and quality,” he said.

Strolling around the streets you find hotel after hotel, chalet after chalet, all with boutique names (no familiar brands). They are successful, family-run businesses or groups of hotels run by individual local hoteliers under different names.

Some employee rental housing exists in each of the hotels and chalets, and other housing exists in nearby towns down valley such as Tasch and Visp, which area accessed by the train. Chalets in the village also provide numerous ownership opportunities for employees. Very few single family homes exist near the village center as several hotels and chalets occupy the walking distance to the shops, restaurants and aerial lifts.

The various ski area restaurants are open in the summer and fall for hikers and sightseeing. “Fast food,” as we know it, is not available at the ski area mountain restaurants. Restaurants are all table service, some fine dining, some more casual, but the food is far better than what ski areas in North America offer, including Telluride (except Allred’s and Alpino Vino). They are all owned by individuals as opposed to the ski area operator. The owners live in the restaurants year-round and many run livestock, make cheese, cure meats, etc., throughout the summer on the alpine meadows outside the restaurants, which are converted farm houses and barns.

Wages for front-line workers are far higher than what is paid in Telluride, and most are salaried instead of hourly. There is a much higher percentage of year-round jobs in Zermatt. This is due to a couple things.

The retailers, restaurants and hotels are more successful because they have better year-round occupancy/utilization due to a critical mass of high-quality hot beds, shops, and restaurants in the village center.

This allows the businesses to focus on hiring people who are interested in a tourism career as opposed to a seasonal job between college and a “real job.” The hospitality employees are very serious about providing high-level service, even in a casual coffee bar.

This leads to higher annual wages and better prosperity for the staff as well as the owners. Businesses are able to operate with fewer employees that are more highly trained and skilled for tourism related work. They rely on high-technology to a great extent to function more efficiently. This is also the case for the ski area operator. This also reduces the need for large amounts of seasonal employee housing.

The vitality this model creates in turn becomes attractive to visitors around the world. It’s not entirely about the skiing (although the skiing in Zermatt is great); it’s about the wonderful alpine village experience combined with incredible year-round mountain recreation.

Zermatt’s tourism economy predated the development of downhill skiing. Actually, like most remote villages in the Alps, they were land-locked in the winter in the early days. They had a successful summer draw because of the beauty of the mountains and the early village ambiance. They developed hotels, chalets, restaurants, and shops. The funds came from industrialists that started banks. The banks needed a place to invest money. The banks hired visionary engineers to work in the mountain villages. That is how the historic hotels, trams to high peaks, and transportation links came to fruition. Much later in Zermatt’s evolution, skiing actually rounded out the year by filling in the winter season. Even today, revenues for the local shops, restaurants and hotels are slightly higher in the summer than the winter.

At the end of the day, Zermatt is an alpine community that has achieved sustainability, year-round vitality, and prosperity for the locals without the sprawl normally associated with growth. The setting is beautiful, the recreation is outstanding, the restaurants and shopping is wonderful, and the local people largely have alignment on the things that are most important in terms of making their community work.

Visitors come to Zermatt because of its reputation for a high-quality alpine village and mountain experience, on a year-round basis. If it’s raining in November and the mountain doesn’t have enough snow to open, a trip to Zermatt is still worthwhile because of everything the village has to offer.

In my next commentary, I will contrast Zermatt to Verbier, Switzerland. I think you may find this to be an interesting comparison. I will also be writing on several other resorts in the coming weeks.

Telluride Ski and Golf is very interested in helping our community become the best that it can be for its full-time residents, second homeowners, employees, and visitors. We view our role as greater than simply running the lifts. Learning from other great alpine villages should be helpful in this pursuit.

I’m interested in your thoughts and feedback. Please feel free to contact me at driley@tellurideskiresort.com
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