KOA CEO Jim Rogers Recounts Major Milestones
Editor’s Note: Kampgrounds of America Inc. (KOA) is celebrating its 50th anniversary this year. Jim Rogers, KOA chairman and CEO, cites some of the franchise’s major milestones in this lengthy interview, the first part of which appears in the April issue of Woodall’s Campground Management (WCM). KOA, the world’s largest system of privately held campgrounds, has 488 locations across the United States and Canada. The franchise records over 15 million camper visits per year. KOA was founded in 1962 in Billings, Mont., which is where it is still headquartered today. Oscar L. Tang, a Chinese-born American financier, and his family have owned KOA since 1988, when they took the company private. KOA is a franchise operation; it owns and operates 26 large resorts, and the rest of the campgrounds are individually owned. The largest multiunit franchisee owns 10 locations. WCM caught up with Rogers one afternoon in March where he shared these and other thoughts. Click here to hear the Rogers interview or follow it below.
WCM: KOA has a storied history. Your brand is the best known in camping circles and among non-campers as well. The company was recently named one of the Top 50 Franchises in the U.S. Tell me what you think are the major company developments and accomplishments and milestones along the way in the past 50 years.
ROGERS: Well gosh, I’d need an hour to do that, maybe even longer. But let me just try to identify some top ones. I think the recognition that we continue to receive that you just mentioned is essential in any franchise organization. The fact that we are receiving great feedback from our franchisees, and that’s what we were measured for, to be one of the Top 50 Franchises in all those hundreds of them out there, so that’s an accomplishment for sure.
A milestone is we just did a Harris Poll in 2011; the Harris organization is a very prominent research group. And we learned that 25 percent of American adults have stayed at KOA at some point in their lives in the last 50 years. So we’ve touched a lot of Americans. And obviously at the heart of our business is the whole idea that we’re helping Americans and visitors to our country and Canada to get outdoors with their family and friends, and that’s certainly a part of our culture.
I think the other milestone is the consistency of our brand. We are known for a great experience no matter where they travel. And again, that’s a tribute to our wonderful owners and staffs. KOA.com, as a website, does twice the traffic of all the others in our business combined. It is a horse. It is a great source of information, and I think the technology that we’ve created to support that effort serves the entire industry well.
I think a milestone of reaching halfway around the world to find a sister company or a partner in the Australian KOA, called the Big 4 Holiday Parks, is another accomplishment. We’ve looked a lot of places, and these people are so great and ahead of us in many ways, and we’ve been working on that for about seven years.
And I think lastly, the greatest milestone of our business and of KOA is that we’re guest-driven. We have done so much in the last 10 to 15 years to indeed orient ourselves and our evaluations, based upon the ultimate umpire, which is our guests.
So I think we’ve had a super history and we’re not going to dwell too much on where we’ve been. We have so much going on that’s going to focus us on where we’re going in the next 50.
WCM: Jim, that was a great segue into my next question. KOA is constantly monitoring its customers’ likes and dislikes, and you have a very sophisticated way to do this. Tell me what you learned in 2011 about your guests.
ROGERS: We started with guest feedback the day we opened 50 years ago. Dave Drum, our founder, actually would go down in the evening and handed out a survey, and we actually have the results from that original survey. So guest feedback and impacting our strategies and driving our business has been critical.
Specifically about what we learn, you have to appreciate is that our owners and operators receive today specific verbatim detail on the experience of their guests yesterday and the day before. So it’s not about necessarily a trend. Certainly at KOA headquarters we look at the data and the verbatims and see if there’s something common, is it a fact or if it’s Wi-Fi problems or is it cleanliness problems or, you know, general kinds of things. But the real true benefit here is there are owners and operators that have such pride about the performance of their parks that are getting specific details, both positive and constructive criticism about what the guests experienced just recently, and that has made it incredibly strong in terms of upgrading the overall quality.
And I think the other thing that has been accomplished in the last four or five years, because we have this measurement and this monitoring, KOA’s overall system quality is improved. Last year alone in what we call the ‘net promoter score,’ which is a device that many, many organizations are using to question their customers about whether they would recommend the brand or their service to others, we saw an 8 percent increase across our system. So KOA continues to make a tremendous commitment to that guest feedback and the fact that we get verbatim detail for each franchisee, makes a tremendous impact on where we’re going.
WCM: Jim, unofficially there are about 8,000 privately owned campgrounds out there, as well as thousands of government-owned parks. How do you sort out all this competition and succeed in what I would think is a very competitive marketplace?
ROGERS: Well, I think that of the 8,000 that we talk about, there is obviously a major variance, just as there is in the hotel industry from Motel 6 to a suite on the top of the Wynn in Las Vegas, and I think KOA really dominates that premium segment within the campground industry, and I think we’re further enhancing that. There’s been a lot of publicity lately about the various services and the accommodations that are being made available, and I think that the thing that we have to realize is that, especially with regard to the government-owned parks, there’s a definite place for them, there’s a love for them, there’s an appreciation. And the fact that so many of them are starting points, they’re reasonable, they’re in wonderful locations, and I think some of this discussion over attitudes of private park owners as to whether they should incorporate the local neighbor – that is the public park – has been certainly overplayed. We have to begin to really appreciate what our guests are doing and take that into consideration, as we want to grow the market.
WCM: Is brand recognition more important now than ever?
ROGERS: Yes, there’s no question. The public, the general public, whether you’re buying toothpaste, a new car or your favorite magazine, people are very concerned about what their dollar is providing them; they’re looking for that value. And that recognition of a brand gives you that sense of security; it gives you that sense of you’re going to get what you’ve experienced previously.
In our case we’re so fortunate because of 488 locations, it also provides that geographic capability that no matter where you travel the benefit is there. It’s especially important in our business relative to our franchisees and their staffs. We really think of our brand as being the people, you know, Great People, Great Camping. And the yellow shirts, these are all components. If you think about UPS or Southwest Airlines, you think about their colors; it’s just a reinforcement of the brand. And we certainly are in that business, and the brand that we provide has to have that type of staff delivery and the technology that helps us recognize and serve our guests. And I think that those are the fulfillments behind the KOA brand that are indeed giving us a competitive advantage.
WCM: Let’s talk about cabins and lodges for a minute. They are becoming more and more popular it seems, not only at KOA, but also everywhere across the country. Is this the major way that KOA appeals to the non-RVer?
ROGERS: We’ve just finished a major research project with Coleman and the Outdoor Industry Association that looks at campers across America, and I think what we have to realize is 15 percent of Americans went camping last year; 8 percent of Americans tell us through the curtain study that they own an RV. That’s a big difference. You know, there’s almost an equal number of people that aren’t in the RV side of it.
But more importantly, we’re only getting 15 percent of Americans to go camping. And listen, the outdoor needs or the benefits that are associated with outdoor activity, whether it’s related to obesity, training of children, attention deficit – I mean there are all kinds of health-oriented components. We have to get more Americans outdoors, and the camping world that you talk to and that we represent have been very, very limited in the ethnicity of the camper guests.
The cabin will begin to open that door; we’ve already seen it, that it’s open to everyone. Everyone. And so there is not this need for equipment. They get the excitement and fun of the campground, and I think it’s going to be huge as it relates to encouraging more people to spend time outdoors, time together with family. And that doesn’t mean that the RVer doesn’t come with them or that you have your event and somebody’s in a cabin, somebody’s in a tent, and somebody’s in an RV. But the cabin itself is opening the door to new markets. And most importantly, especially to your audience, it’s incremental. We’re talking about new campers. This isn’t about displacing somebody you already have; this is new business. And if we can begin to tap into the Asian market, the African-American market, and the Latino/Hispanic market because we have this type of offering, watch out, it’s going to be wonderful. It’s going to be a win-win situation for everybody.
WCM: Earlier you mentioned about your worldwide impact and worldwide connections. What have you learned from your relationship with the Big 4 Holiday Parks in Australia?
ROGERS: Well, aside from being just absolutely wonderful people, and it’s kind of fun because I say to them that I can almost line up their members, their franchisees on one wall and mine on the other, and I can find people that are identical to one another. They are so far ahead of us in the accommodation business. Big 4 has been around for just over 30 years, but they are predominantly a roofed accommodation park business, both in terms of the way they’ve positioned themselves and the design of their facilities. They operate, most nearly all of them, year-round. So we have an incredible opportunity to further enhance our revenues. Their average revenue per park is significantly above those of us in the United States.
They have a very competitive environment. They have three major campground chains, so they move at a much faster pace to market. They’re much faster to implement; they’re much faster to change. And so when we team up with them, we’re benefiting from that speed to market in terms of the enhancements that we intend to take advantage of. Their housekeeping systems, and the fact that the greater linkage that they have because they’re in the lodge or cabin business, they have a greater linkage to the Travelocitys and the Orbits. They’ve gotten into a different sector where they’re listed, and it’s just wonderful for that exposure. But as we add the cabin and the facility, we’ll start showing up there and that will be a further enhancement in our marketing. And Big Four is teaching us and leading us to the ability to do that.
WCM: KOA has a proprietary campground management system. You call it “KampSite,” that is currently being updated in cooperation with the Big Four. This would make Kampsite and Big Four’s version called PAM the gold standard in campground management systems around the world. Tell us a little bit about that.
ROGERS: We’ve been fortunate, because again we have a gentleman named Josh Bell, who is a third-generation campground owner out of the San Diego KOA, which is an absolutely extraordinary facility. And Josh, for the last 2 1/2 years has been on assignment. We had a shared-executive situation and it just continued to grow.
And where we’re going with KOA’s KampSite is we’ve been on a legacy text-based interface. So this is what you’ll find in most casino hotels, which is my background. But we know that the browser can be prettier, greater at visual impact, and we can train faster on it. So we’re taking the tools that indeed have been developed in the Big Four Park Administration Management system, or PAM, and incorporating them into 2.0, Kampsite 2.0.
I think because of the intensity of competition over there, they move at a little faster rate in terms of improvements, so we’re going to benefit from that. We signed up for a team effort for the next two years. Our team of four programmers are in Melbourne today; they’ve been there all week. And you’re going to find that together we’re going to have a magnificent campground management system that allows us to better serve our campground owners, no matter where they are in the world. And from the guest standpoint, we’re going to have components in there that are going to allow us to recognize and better understand what you told us, that you’re traveling with a dog, what kind of dog, the site you like, and, you know, the type of rig you’re driving, the people with you. We’re going to have really the high-touch component on that side of the business as a result of these two groups putting their minds and their skills together to generate this.
It’s just absolutely wonderful that this small company in Billings, Mont., is teaming up with this wonderful group in Melbourne to accomplish this. It’s very exciting for us. It will lead to discounts being listed, timed reservations, gift cards, and again, I think a better service to our overall guests and our franchisees.
WCM: Let’s move to employee training. KOA operates the Work at KOA program. I understand it’s like a dating service where you put potential qualified Workcampers together with the KOA owners with jobs to offer. Can you explain how that came to be and how that works?
ROGERS: Our hats are off to the Workamper News folks. I think we learned early on if we’re going to have a strategy of Great People, Great Camping, that we better deliver. And so we began, in surveying our franchisees as we do every year, we found that finding great employees was one of their top challenges. And we also saw this turnover that was occurring, this transition of people, we found Workcampers that we were hiring that were pulling up in the middle of the season and disappearing in the night. And we said, “Look, if we set a special standard of expectations, let’s go out and see if we can begin to get the cream of the crop.” So we created the KOA All-Star Workcamper Program.
We have nearly 2,000 couples now that are involved in that. And just think about this, these people are interested in travel; they’re interested in staying engaged. They’ve got the experience, they’re mature, and they’re wonderful mentors for our younger staff. And then the technology that’s at every KOA is the same. So when you walk into the front desk in Texas, having been in Oregon, you’re walking into KampSite, you know how to use that. You know the KOA yellow shirt. You know our philosophy and maybe you’ve been trained at one of our boot camps. I think about Starbucks and they replace 100,000 baristas a year; they start from scratch. We’re taking advantage of the people that are interested in the travel in the country and we can move them.
We have couples now that have worked for us for seven or eight seasons. So they’ll stay for three months where their daughter lives in Oregon, we’ll help pay for their camping to move them to Texas, where their son lives. They’ll go up to Bar Harbor, Maine, where their best friend from college lives, and then we’ll move them into Florida. So this opportunity of staying with something that they’re familiar with, receiving a good check, helping pay for their camping, it’s absolutely a win-win for everybody involved and certainly raises the bars in terms of the quality of the employee and the level of service that we’re providing our guests. And most importantly, it makes it a lot easier on our franchisees to find great employees. It used to take them a month; they now can do it online in a couple of hours.
WCM: I can imagine there must be days when your competition must be shaking in its boots when it hears you talk like this. Do you field inquiries from would-be imitators who try to pry trade secrets out of you and the KOA people?
ROGERS: I come from the casino hotel industry, as I mentioned earlier. There’s very little that we consider to be trade secrets. It’s not about what you know; it’s about what you do with it. And with our KOA nation and the systems that are going on, I think so much of what we do is fairly obvious to people. I think we share a great deal. I speak at a number of state association meetings.
I think that we have the opportunity to continue to lead through our actions, to demonstrate the expertise. We’ve got 80 people working full-time in this business in Billings, Mont. These people are writing new chapters, and if we can share some of that with other folks, then we all benefit, we’re going to grow the business.
And our business is relatively small. It’s being challenged in a lot of ways due to real estate development or the economics that are associated with this. So we’ll just – we want to continue to raise the bar. And I think, again, it’s the opportunity for independent owners, if they really want to know what’s behind the door at KOA, then they join us. I think our conversion process has been incredibly successful in the last four or five years because what we’ve done is found a lot of independent operators who are saying they want to take their park to the next level, and they see KOA’s marketing technology hiring legacy as well as innovation and saying, “How do I get to be part of that?” and so they convert to us.
And I’ll give you one quick story. We had a seasoned veteran who has been in the business for 27 years attend KOA University three weeks ago. And here’s somebody that’s been in the business, operating independently, joined KOA, came into our university, and they just were flabbergasted about how much they had yet to learn. And so I think, again, back to my compliment to you, I think there’s intellectual capacity within our owners and people in this business that we have yet to tap, and KOA is trying to do all it can to put that forward.
WCM: Now you’ve got a big weekend coming up in May, I understand.
ROGERS: We support 44 specialized camps that host children with cancer and their siblings each summer for usually a week’s stay. We raise about $500,000.00 a year in a variety of ways, but this weekend is what makes it. It’s our big Come Kamp and Care With Us weekend. It’s a free night on Saturday if you stay with us on Friday. It’s May 11th and 12th. It’s become one of the largest weekends, outside of holiday weekends, that we have. So it’s another example of how we’ve been able to build a promotion that has a major impact on our system, and more importantly, helps thousands of children with cancer enjoy the outdoors for a bit.
WCM: You’ve touched on a lot of points in last month’s opening. Are there other new nuances that the campground industry can expect from KOA in 2012 that we haven’t already talked about?
ROGERS: Well, we’ve got marshmallows on the cover of our 50th anniversary edition directory, so that’s pretty hot. I mean, you know, when we got the Roll-a-Roaster, you’re going to hear the story about the Roll-a-Roaster all year long and the wonderful gentleman up in Idaho that created it.
I think that we have all kinds of things we’re going to try to do this year, whether it’s mobile apps, new forms of reservations. You’re going to see more partnerships with outdoor gear companies. I mentioned we’re into it with Coleman and Keystone and we’re doing things with the Outdoor Industry Foundation that’s a matter of we don’t want to strictly limit ourselves to the vehicle side; we’re out talking to the Colemans and the North Faces and the Mountain Gears and the Outside magazine folks, because this is a marketplace we belong in.
And again, there may be a lot of things going on you’re not going to see. We have so much direct online feature, social media. There is so much going on. We’ve hired a wonderful new talent, Tobey Hedges, that’s come in that’s leading up our new sort of guest technology side and taking on the marketing reins. So there’s going to be a lot going on at KOA, as there is every year. But I think that a lot of it is going to be things that touch the guests directly and the general public is not going to see.
WCM: Some states, such as California, as I have been told, have actually approached KOA to take over management of some of their financially troubled parks. Is this something that KOA will undertake there or in other states?
ROGERS: I’ve been very proactive at reaching out to the public sector. I’ve met with the National Park Service, the Forest Service, the Army Corps of Engineers, the Bureau of Land Management; I’ve spoken at the National Conference for State Park Directors; I’ve met personally with the state park leadership in California. It’s not about taking anything over. What we’ve been very interested in recommending is a hybrid; it is our recommendation that you have a staff that already exists, that understands their parks, understands the conservation, the woods, the water. What they’ve never been taught is the business. And that’s what we’ve been doing for 50 years, we’ve been teaching people how to run the business.
And so our recommendation to these public entities is to take their rangers and bring them into KOA University. Let’s teach them how to add an economic model that doesn’t exist there. Let’s show them what cabins could do. Imagine how successful our cabin inventory is today; they (state and national parks) have locations that nobody will ever replicate. There would be a premium on that piece. It would be extraordinary and it would create an economic engine that does not exist today that would allow them to replace the pavement and improve trails and do the things that they do.
So this isn’t about becoming a concessionaire in any situation, this is about indeed helping them to help themselves, which is something that we’ve been doing with our franchisees, again, for 50 years. And as I mentioned before, I really think if we look at the guest perspective on this, 25 to 30 percent of all of our guests visit public campgrounds during the year. We’re not going to get all their camper nights at a private facility. We need to help the public category so that our guests are satisfied in those environments, so services they’re seeking are provided and that they enjoy the camping experience. And as I said earlier, such a large percentage of the people that are in public facilities are first-timers. Well gosh, I mean if that’s a breeding ground for future campers, a lifetime worth of that is significant, let’s do all that we can to make them deliver and provide the kinds of things that those prospects are looking for.
WCM: I would like you to get out your crystal ball and tell us what you foresee for the next few years in your franchise. Number 1, the number of KOA campgrounds. You’re at 488 now. Where do you see yourself in five years in terms of breadth?
ROGERS: At some point our space is limited. We can only – every franchisee gets an exclusive territory. But we’re going to be the 550 to 600. We’re going to continue to grow. We are just – we’re adding 25 to 30 locations a year, independents that decide to join KOA, and we continue to see that momentum.
WCM: How about a feature not found at a KOA today, but which may appear in the next few years?
ROGERS: Well, I think that feature is something I talked about earlier. I think you’re going to see greater diversity in our camper base, ethnic diversity. I think you’re going to see a greater – we’re convincing the RV dealers, think about this, you know, 58 percent of our campers are coming from home. We’re working in the same market as the RV dealer down the street, the road. think RV dealers are going to find that the campground is their best showroom. And if you go to the Curtain research, the highest propensity to buy are from existing campers. Those RV dealers are going to be doing more at campgrounds. That’s where their business is, rather than waiting for people to come to their showrooms.
And I think you’re going to continue to see us upgrade our lodging. We’ve got 4,000 camping cabins, which have been in the system for a long time, that have no bathroom or kitchen in them, but they need the – because of the popularity of the accommodations sector you’re going to see us upgrade those as well.
WCM: How about international expansion? Do you see Kampgrounds of America going beyond North America, for example?
ROGERS: I think that we will continue to share our proprietary technology, training, marketing, service quality. We have a tremendous lead in China.We have a great number of people that have contacted us from there. We have a representative in Europe today. KOA is well-regarded throughout the world, and I think that our desire is not necessarily to take KOA there, but to share what we’ve learned and to have more of a master license agreement. We’ve got so many opportunities right here in North America that we’re going to continue to stay focused on better serving the outdoor interest that exists right in our neighborhood.
WCM: Speaking of cabins, do you ever imagine a day when there might be more cabins at a particular campground than RV sites?
ROGERS: Well, I think there’s still a huge market for RVs. I think that 250-260,000, we talk about selling, again, you go to the Curtain study, you find that there are millions of people that are still thinking about getting into RVs. And the other thing that’s happening is our president, Pat Hittmeier, mentioned the other day that a speaker said, “Hey, you know, in the next 10 or 15 years there are going to be 25 states that feel more and more like Florida.” In that group, the Baby Boomer has the highest propensity to own an RV. So I think we’re going to continue to see RV sales be robust and take off. I don’t think our RV business will ever be overcome by the cabins, but the revenue generation and the mix will indeed change. And the yield management that’s associated with it will change as operators realize that they can get more per square foot by making the investment in a cabin.
WCM: And finally, discount camping clubs. Do you think there always will be a need for that and a demand for that, and do you see that in fact growing in the future?
ROGERS: I think people like affiliation. I think that what Good Sam does well is the community it creates. So I think there are going to be more and more efforts. We’ve got Around the Campfire, a social media gathering. I think that those kinds of things, whether it’s a discount camping club as we’ve known it, I think it’s going to be more of a social engagement; it’s what camping is all about, it’s what our society is missing, is that true, genuine engagement. We hook ourselves up to technology and we lose that eye contact, that hand touch. So I think there’s going to be more of that type of gathering of people that may come out of a club opportunity than necessarily just, “Here’s your 10 percent discount.”
WCM: Final question. If one of our readers wants to become a KOA franchisee how do they go about doing it?
Rogers: That would be great and we would obviously love the opportunity to talk to them. It’s Jim Rogers, my cell phone number is (775) 742-9092. I’ll talk to any one of them and refer them on to our development folks. I’d love to have the opportunity to chat with them about what KOA is up to and the ways that we can help them grow their business, so that would be terrific.