ARVC Business Forum Reports on the Industry
This week's ARVC Business Forum, held on the campus of Keystone RV Co. in Goshen, Ind., featured a typically lively give-and-take among the leadership of the National Association of RV Parks and Campgrounds and some of the nation’s key campground vendors.
Forum members met in conjunction with the Recreation Vehicle Industry Association (RVIA) Committee Week and Annual Meeting functions held not far away in downtown South Bend. The week’s agenda also included an industry party in recognition of what RVIA has designated in 2010 as the RV industry’s centennial.
The ARVC Business Forum brings together members of the ARVC Executive Committee and key players in the RV parks and campground business to discuss topical issues.
Shane Ott, director of campground relations for Thor Industries Inc., Keystone's parent company, who helped orchestrate the meeting at Keystone, said the forum meeting at an RV company, a first for the forum, will help narrow "the huge gap" between the campground and RV industries. "There is no reason we shouldn't do this more often," he said.
A few forum highlights:
Mark Anderson, former ARVC chairman and owner of Camp Chautauqua Camping Resort, Chautauqua, N.Y., reported that his park and many others in the East “had almost a perfect Memorial Day weekend,” providing “a great start” to the season. The summer’s outlook for the Northeast is good as travel is up, he added. He noted that while the state of New York is “broke,” the governor found funds to reopen the state parks, which Anderson considers “an important baseline to private campgrounds.”
Vic Nolting, vice chairman of Leisure Systems Inc., franchisor of the Yogi Bear’s Jellystone Park Camp-Resorts, Milford, Ohio, began by summarizing, “In general, things look oh so much better than last year.” He then deferred to LSI’s COO, Rob Schutter Jr., who went into greater detail. Schutter echoed Anderson’s holiday observation. He said business in the Northeast is “leveling out” after “a disaster last year,” due to weather.
Schutter, noting that Yogi operators are seeing an upturn in campers’ ancillary spending after a 2%-3% downturn in such spending last year, reported that the rental market at Jellystone Parks is “through the roof,” thanks in part to its non-dependence on good weather and the growing number of visits of campers new to the Jellystone system.
LSI’s rental business was up 8% in 2009 and he expects another rise this year. The rental business, which puts campers into lodges and cabins, is bringing a lot of non-traditional or first-time campers, added Nolting. They explained that many Jellystone Parks maintain good working relationships with area chambers of commerce and hotels, which also spurs business. Cabin rental rates were $145 a night in 2009 and have been raised by $10 a night for the 2010 season, said Schutter, adding that LSI opened its first company-owned park this year in Bloomington, Ind.
Cindy Halley, publisher of the Trailer Life RV Parks and Campgrounds Directory and vice president of Good Sam Club marketing, Ventura, Calif., reported that TL’s rep teams are well underway in their collection of data and advertising sales for the 2011 directory. Team members “are very upbeat and expect a better year overall,” she said. On the club side, membership growth is exceeding forecasts and currently totals about 950,000. Good Sam Club members average 62 years of age and are typically retired, empty nesters. However, she added, the club is always trying to recruit younger members.
Eric Stumberg, president and co-founder of Wi-Fi provider TengoInternet, Austin, Texas, reported that TengoInternet’s acquisition of Nomad ISP is complete with Nomad’s clients integrated into Tengo’s in May, bringing its market penetration to some 800 parks and between 67,000 and 100,000 guests a month, depending upon the season.
Wi-Fi remains a key criteria in RVers’ decision on where to camp, he noted. He sees mobile point of sale terminals, such as an ice cream cart that accepts credit card swipes, becoming the next popular phase in parks and campgrounds. He is targeting 25% growth for 2010.
David L. Berg, ARVC chairman and owner of the Red Apple Campground in Kennebunkport, Maine, said business appears to be “back to where we used to be.” He had sold out his 140 sites for the July 4 holiday by Memorial Day and his tent and popup trailer sites sold out first for the first time ever.
Berg, at the same time, said he remains “boggled” by the growth and popularity of the cabin business. He charges $120 a night for a cabin, even though “the motel down the street charges $29.” He can explain the willingness to pay more because customers “want it all today, the safety, the experience…” He also is getting into the RV rental market, charging about $1,000 a week to rent a unit on-site.
Al Johnson, president of Recreational Adventures Co., an 11-park chain based in Hill City, S.D., reported “an exceptional Memorial Day” and stated that nine of his 11 KOA-affilitated properties are ahead of plan so far this year. He has begun to replace aged cabins with new park models. He is putting on hold an overhaul of RV sites until he can better determine size requirements for the next RV generation. He, too, saw more guests with tents and folding camping trailers last year, but said it’s too early to tell whether that trend will continue this year.
David Gorin, who wore multiple hats to the forum as a campground consultant, ARVC lobbyist, park owner and state association director, reported that his Holiday Cove RV Resort in Bradenton, Fla., experienced a 25% increase in business last year, with his rental business up 20%-25% annually.
Gorin says he sold approximately half of the lots for sale in his park in the last 19 months. As director of the Virginia Campground Association, he said that state’s parks are looking for a good year, but that they’re concerned about whether the Gulf oil spill will make its way eventually up the East Coast. Meanwhile, Gorin says his Best Parks in America network has grown from 22 to 63 parks in the past year, has recently finished a long-term strategy session and will be publishing its first print directory. Finally, Gorin announced that he will be building a new 250-site RV park in Palmetto, Fla.
Ann Emerson, ARVC Business Forum chairwoman and vice president of Woodall Publications, publisher of the Woodall’s North American Campground Directory, Ventura, Calif., said sales consultants are reporting overall that most parks are doing well. In general, parks near metro areas are still faring better than those in remote areas. And there’s a serious concern among tourism-related business operators — parks among them — in many Southern and Southeastern locales regarding the long-term impact of the Gulf oil spill, prompting some owners to defer decisions on marketing expenses.
Emerson began a discussion on the explosion of social media in the campground business. At her parent company, Affinity Group Inc. (AGI), parent company of RV Business and Woodall’s Campground Management, almost all the websites have a Facebook page and each publication has at least one staff member assigned to increase its social media presence and AGI is developing a SmartPhone “app” for both of its campground directories. This discussion elicited comments on mobile marketing, which fueled a wider discussion on the explosion of mobile phone use in society. Some 90% of all U.S. homes have cell phones, and a significant percentage of Woodall customers have SmartPhones, she said. Stumberg noted that one study showed that almost as many people today access the Internet via their SmartPhones as from personal computers.
Bruce Hoster, president of Coast to Coast Resorts, the membership camping wing of AGI, said, “We think membership camping is due for a renaissance.” He cited a number of ways Coast to Coast is attracting new parks and members to the concept. As an aside, he observed that membership campgrounds are finding new revenue streams by developing storage facilities for their members’ RVs while they are not camping. For example, one membership park developed a 7-acre storage facility and realizes an estimated $1 million in revenue in annual storage fees. He reported that Camp Club USA, AGI’s discount camping club, “has come back strong after seeing a slight dip during the recession” with high renewal rates and is up to nearly 50,000 members. Coast to Coast, which has taken membership camping under its wing, sponsored a membership camping conference in February in Las Vegas and will sponsor another in February in New Orleans. He is working to make inroads with developers of hotel and condo complexes to consider integrating campgrounds into their projects, he said.
Pat Hittmeier, president of Kampgrounds of America Inc. (KOA), Billings, Mont., said camping was “soft” over the winter, hindered by cold weather in its Southern campgrounds. But it’s taken off since May and was up 7% through Memorial Day. KOA is projecting an 8% increase through Labor Day, said Hittmeier, adding that use of the Internet to make reservations is up 12% over last year, a reflection of more business in general and the migration of campers to the Internet.
KOA has 4,000 units in its lodging pool and that business is strong, he said. Lodges make up 13% of the total KOA sites, but the company is aiming to raise that figure to 20% at 50% of its campgrounds. KOA also is looking to increase its first-time visits, which now make up 15% to 19% of its total guests.
ARVC loyalist Ian Steyn, owner of Jellystone Castle Rock Campground, Castle Rock, Colo., noted that his business is up 38% year-over-year, and 2009 was a good year for his business. He discussed an integrated approach to promoting the outdoors with other hospitality businesses in his community seeking to make it the epicenter for outdoor recreation in his state.
Larry Weaver, park model sales manager for CrossRoads RV, Topeka, Ind., briefly outlined the preferred park model program his parent company, Thor Industries Inc., has established with ARVC. Weaver stressed that campground owners should make sure they buy “ruggedized” park models for their rental units and refrain from features such as carpeting that will not hold up well under the rigors of long-term use.