Let’s do some math. No, let’s do some Epic math.

You are welcome to continue when you’re done rolling your eyes. No more Epic jokes, I promise.

The Cost
The best numbers we have about EpicMix came from the first year after its launch. From rumors and gossip, I’ve heard a few times that the initial cost was about $3,000,000 that first year.

Social Sharing
We know that in its first year, EpicMix generated 275,000 posts for an estimated 35,000,000 impressions based on an average of 130 friends per user. Yet, most posts at that time were only seen by about 20% of friends/fans/etc. So, we’ll use 7,000,000 impressions as our baseline.

To get 7,000,000 impressions using Facebook’s “Boost Post” feature, a couple tests showed that to get an average of 515,000 impressions, you’d have to pay at most $3,000. So, my best guess is that a dollar would earn you about 170 impressions or a value/cost of about $40,000 for 7,000,000 (on Twitter it would be about $25,000 – $34,000).

Website Traffic
The second number, which we also have to take at face value with not too many details, is 1,700,000 web/mobile visits to the EpicMix site. While the traffic is going to a web app, rather than a sales property, it certainly has significant value.

I’m afraid all we can do here is estimate. If the value of a visit is $.25 (which I think is reasonable when you look at CPM/CPC rates as well as site conversion / revenue per conversion), those 1,700,000 visitors would have a value of $425,000.

Pass Renewals
According to the report, about 100,000 people activated their EpicMix accounts that first season which represented 15% adoption rate. This means there were approximately 650,000 unique skiers that skied Vail Resorts that season.

Each season about 300,000 Epic Passes are sold. So of all their skiers, about 45% are passholders which means about 45,000 of those 100,000 EpicMix users are passholders (it could easily be more as not all ticket products had RFID until the following season).

Every time a skier heads to the mountain, they become about 5 percentage points more likely to renew their pass. So if those 45,000 Epic Pass holders normally renew about 60% of the time, a pass costs $650, and EpicMix can get them to ski just one more time each season, the incremental revenue of that motivation would be $1,460,000.

Ancillary Spend
With 45,000 skiers heading to the hill one more time, we also need to factor in ancillary spend. I’m actually going to leave this open and see what the ancillary spend would need to be in order to break even.

So…

Tying it All Together
Okay, here’s my math:

In other words, an ancillary spend per skier of just $24 per skier is all it would take to break even.

Now, we’ve assumed a lot. We’ve assumed that it cost $3,000,000 initially. We’ve assumed renewal rates and web CPMs. Yet, there’s a lot we have known and much of the numbers I’ve used were provided by the resort.

But we haven’t even factored in incremental visits and ancillary spend from non-passholders or the actual revenue and brand value generated by those 7,000,000 social media impressions.

Opportunity Cost
The kicker to me is opportunity cost. Interestingly enough, the cost of a new high-speed lift often starts at around $3,000,000. How much ancillary spend does a new lift create? How many social impressions? Does it increase the likelihood skiers will renew their pass each year (not just the first)? Does it generate website traffic?

The fact that, even with all my assumptions, my math shows that EpicMix could have broken even the first year says to me that it may be one of the smartest investments in skiing.

Plus, how much of that $3,000,000 will be repeated each year? Less than a 1/3? Which means the value that helped it break even the first year is repeated every year even though the costs are significantly less.

Final Word
Skiers don’t hate EpicMix. Half of skier love it. It drives more ski days. It boosts renewal rates. It generates millions of word-of-mouth social impressions. It drives incremental revenue and ancillary spend. It costs about as much as a new lift. It generates data that could solve some of skiing’s hassles and frustrations. It opens doors for personalization that have never been considered.

Is something like EpicMix the future of skiing?

Call me crazy, but I believe it is.

About Gregg & SlopeFillers
I've had more first-time visitors lately, so adding a quick "about" section. I started SlopeFillers in 2010 with the simple goal of sharing great resort marketing strategies. Today I run marketing for resort ecommerce and CRM provider Inntopia, my home mountain is the lovely Nordic Valley, and my favorite marketing campaign remains the Ski Utah TV show that sold me on skiing as a kid in the 90s.