Paul Anderson on tourism and New Zealand skiing
Paul Anderson CA is helping the ski industry cope with global warming, perceived high costs and leisure dollar competition
- NZSki attracts 500,000 visitors a year, approximately 40 per cent of total market share
- New Zealand’s tourism industry is booming, recently passing dairy as the largest export market
- Snowmaking is mitigating the effects of global warming for the industry
By Ben Power
NZSki chief executive Paul Anderson CA was just nine years old when his father tragically passed away. But from the loss came the birth of a passion: skiing.
In the August school holidays family friends took him off his mother’s hands to ski at Whakapapa, where Anderson developed a deep emotional bond with the sport.
After working in the crucible of the post-earthquake Christchurch City Council, Anderson has landed his dream job: heading the company that runs the iconic South Island ski fields of Coronet Peak, The Remarkables and Mt Hutt.
“It’s a privilege to work in an industry I love,” he says. The New Zealand tourism industry is surging, recently passing dairy as the nation’s largest export market. But with snowsports facing challenges from global warming and flat visitor numbers post-GFC, Anderson wants to help kickstart skiing’s growth and boost its contribution to the tourism industry’s success.
He wants to return skiing to the boom days of the 1980s. “For me, it’s about making people understand what a great product it is and how much fun you can have,” he says.
Anderson, who grew up in Christchurch, showed an early interest in tourism. His Masters of Accounting at the University of Canterbury focused on the major airlines’ use of travel agent relationships and reservation systems to create a competitive advantage.
Anderson completed his CA during his first role out of university with NZ Treasury, but he viewed accountancy as a base, rather than an end goal. He moved into the private sector, and took on roles at NatWest GFM and Telecom, before becoming general manager of corporate services at Christchurch City Council in January 2008, some three years before the devastating earthquake.
It was 4.37am on a Saturday morning in September 2010 when the first Christchurch earthquake hit. He had planned to drive to Wanaka on a ski trip that morning but was forced to cancel. But when the second earthquake struck in February 2011, Anderson knew straight away that it was far more serious.
“I was in the Council building in the city when that occurred and from the strength of the earthquake, I knew immediately how grave the situation was,” he says.
Helping manage post-earthquake Christchurch was a searing but rewarding experience and taught him the value of quick, courageous decision making.
Council was running an emergency operations centre in the former art gallery, but faced the complete loss of operability when it started having power issues. Anderson ordered an emergency generator.
The generator was never used. Later, that lack of use attracted the attention of bureaucrats in Wellington who questioned the need for it.
“But that’s an example of a decision that needed to be made fast,” Anderson says.
“It was an insurance policy. We needed people who had the guts to make those calls and defend them later. If we’d all sought approval it really would have curtailed the response.”
Anderson also helped negotiate the $NZ3b cost-sharing agreement between the council and government. While there has been some criticism, the cost-sharing agreement “still represents a fair division of costs and responsibilities between local and central government”, he says.
Up the slopes
Anderson was keen to use his experience to step up into a CEO role for the first time. Fortuitously, his wife saw the NZSki chief executive’s role advertised in The Press.
“We’d always dreamed of living somewhere like Queenstown but never thought our career situation would allow it,” he says. He landed the gig and now heads a company that has 1,200 employees during peak season.
“It’s a great size company for my first CEO role,” he says. There were obvious parallels with council. Anderson says the ski areas are “like small towns on a mountain”.
He immediately oversaw a NZ$45m expansion of The Remarkables, which had already been approved by the board, including new chairlifts, trails, sealed roads and a new base building.
But he faces another challenge: kickstarting broader growth in the ski industry.
NZSki attracts 500,000 visitors each year, giving it 35-40 per cent of total market share, which means its performance is vital to both the industry itself and New Zealand’s tourism base.
After strong double-digit compound growth over many years, New Zealand’s tourism industry recently passed dairy as the nation’s biggest export earner. The ski industry is part of the “attractions” segment and represents just 9% of total tourism spending.
“But they are the reason for the other 91 per cent spent on accommodation, travel, restaurants, etc,” Anderson says. He says around $11 is spent in total (on things like accommodation and food) for every $1 spent on the attractions such as skiing.
“So my estimate is that a normal ski year is worth around NZ$1.4b to the NZ economy in direct and indirect spend, a significant portion of the country’s tourism earnings.”
We needed people who had the guts to make those calls and defend them later. If we’d all sought approval it really would have curtailed the response.
New Zealand skiing is popular, with visitors from the East Coast of Australia a particularly strong market. Chinese, Indians and Malaysians are emerging as a source of skiers as well. But overall growth in ski visitor numbers has been relatively flat in recent years.
Numbers peaked at 1.54 million in 2009. In 2015 total visitors, at 1.5 million, were below that peak, though up on 2014’s 1.38 million.
Anderson says the ski industry has faced competition from sedentary activities in town like going to cafes and malls. “You have to be committed,” he says, adding that it’s hard to have fun skiing initially because of the learning curve. “But we know that once you’ve broken through that learning curve you’re hooked.”
Anderson remembers clearly that on weekends during the 1980s everyone would finish work, grab their skis and head to the mountains.
“We need to make sure people understand how awesome skiing and riding is if they make the effort to get to the mountains,” he says.
As in Christchurch, Anderson hasn’t been afraid to lead bold moves. NZSki recently launched a major initiative based around aggressive pricing aimed at increasing snowsports participation, especially among local communities, with big cuts to season pass prices.
The 3-Peak season pass, which gives access to all three ski areas, has fallen from NZ$999 to at NZ$599; a season pass to Mt Hutt has been slashed from NZ$749 to just NZ$299.
The company also launched some extremely good value learn-to-ski packages.
“These initiatives are aimed at encouraging a wider proportion of the local community to participate in skiing or snowboarding and have been extremely positively received by the market,” Anderson says.
The ski industry faces another challenge with global warming driving greater variation in weather patterns.
“We’ve mitigated the impact somewhat with big investment in snowmaking and grooming and, for the foreseeable future, this will allow us to deliver a consistent and reliable product on the mountains for our guests,” Anderson says.
“Our most recent season saw a record snowfall at Coronet Peak — an indication of the kind of variation in season that we have learned to manage.”
Love your work
Most importantly, has Anderson’s job opened up more opportunities to ski?
“I ski as much as possible,” he says.
“It’s pretty important to get out and about and to see the product we’re putting out for our customers”.
His favourite memory from the past season was hiking up from the Shadow Basin chair to ski fresh powder on the East Face at The Remarkables with his wife.
His emotional connection with skiing, which was formed early in his life after his father’s death, is still evident.
“I love anything that gets me outside, but in particular with skiing I love the magnificent environments we operate in and the exhilaration of the sport.”
And he has a clear vision for the company: to cement NZSki’s resorts as the finest in Australasia. He wants to keep driving visitor volumes, particularly from the Australian market, which would allow the company to expand some of its “fantastic” side-country terrain.
Anderson says accounting has given him a strong foundation and helped him to meet the significant challenges he faces as a CEO. “Being a CA gives you a methodical approach to problem solving,” he says.
“That structured way of thinking allows you to take big problems and boil them down to something that’s solvable rather than be overwhelmed by something.”
As a CEO, Anderson is enjoying the accountability of managing an entire business rather than just the finances.
“My ambition is to keep on learning and making a difference in whatever role I’m in and to enjoy life at the same time,” he says. “If I’m able to keep developing and growing NZSki, I’m sure it will continue to provide the right challenges for me. Longer term, I’d consider a larger CEO role although it’s hard to think of spending all day behind a desk after working in this industry.”
Ben Power is a freelance writer and communications consultant.
This article was first published in the May 2016 issue of Acuity magazine.