Top

Insiders: Membership Camping on a Rebound

Email This Post Email This Post Print This Post Print This Post

July 16, 2013 by   - () Leave a Comment

Rushmore Shadows, a Midwest Outdoor Resorts campground in South Dakota. 

After a prolonged downturn that began well before the Great Recession, membership camping seems to be on the rebound.

Major players in this oftentimes misunderstood segment of the outdoor hospitality business tell Woodall’s Campground Management (WCM) that they are upbeat about the recent past and more so about the immediate future as regular campers as well as newcomers discover the appeal of membership camping.

That appeal revolves around the individual beauty of the member parks, the security that they afford every camper and the relative affordability in an era of ever-rising camping costs elsewhere in the public and private sector.

Under membership camping, members pay an upfront membership fee that is good for, say five to 10 years, or perhaps a lifetime, which allows members to access one or more resorts, if the resort is part of a network.

“We have seen the last five years, even with the economy upside down, we have had our best year, year after year. When life gets hard, people go camping,” said Mike Pournoury, CEO and majority owner of Texarkana, Texas-based Ocean Canyon Properties, a growing system of eight privately owned, membership resorts in the Southeast that offer spacious RV campsites, comfortable vacation cabins, cottages and condos along with a wide variety of private resort amenities. “The industry as a whole has been weak due to the fact that it is so fragmented, but if you talk to each company like ours, business is great, seriously. Several companies our size are just thriving in this industry. I have a real positive expectancy for the future of the membership industry.”

Bruce Hoster (left) of Coast to Coast Resorts and Mike Pournoury of Ocean Canyon Properties

Gene Addink, general manager and CEO of Midwest Outdoor Resorts, which owns and operates three resorts in South Dakota and Minnesota, agrees with Pournoury’s take on the business.

“Even in bad times, we were successful,” said Addink, who has been in the membership camping business since 1984 and led the team that founded Midwest Outdoor Resorts in 2000. “There was a little bit of a downturn in 2008-2009 but when the economy was at its worst, even then we were successful.”

Addink, whose company operates resorts near Rapid City, S.D., and two in the greater Minneapolis area, is looking to add a fourth resort this year, either in northern Minnesota or northern Wisconsin.

Pournoury and Addink say their companies are typical of the more than 50 membership camping systems that operate in the U.S. and Canada. Both maintain systems of upscale campgrounds that appeal to seasoned campers as well as newbies and also employ expert sales staffs that can walk prospects through the intricate concept of membership camping.

“It’s not like going to a KOA,” said Addink. “If you’re going to a KOA, you know what you’re getting. With membership camping, the concept has to be explained to people one on one. It is usually not a product people shop for. They have to be shown how it fits in their lifestyle. It’s a very misunderstood concept in the public’s eye.”

Gene Addink, CEO of Midwest Outdoor Resorts

Each membership camping system has its own set of rules, pricing and reciprocal agreements. The concept requires a full explanation before purchase.

“It takes a proactive marketing group that can find people who fit your demographic and then convince them to come to a presentation to learn about the program,” Addink said. In his 30 years in the business, he doubts whether more than five clients ever literally walked in off the street and purchased a membership without first undergoing a formal sales presentation.

Thousand Trails Zone Pass

The industry’s leading player, Thousand Trails, affiliated with Chicago-based real estate giant Equity LifeStyle Properties Inc. (ELS), has enlisted the ranks of the RV industry to help it sell memberships for its far-flung system of 80 RV resorts in 22 states and British Columbia. Today, more than 100,000 member families and guests enjoy its parks. Formerly only open to lifetime members, Thousand Trails has introduced the Zone Camping Pass, which provides a low-investment way to enjoy the benefits of resort-style camping on an annual basis.

An ELS spokesman was unavailable to speak with WCM. However, in a filing with the Securities and Exchange Commission (SEC) at the end of 2012, ELS had these comments on its membership camping business.

“In the spring of 2010, Thousand Trails introduced low-cost membership products that focus on the installed base of almost 8 million RV owners. The company began offering a Zone Park Pass, which can be purchased for one to four zones of the United States and required annual payments in 2012 of $499. Beginning on Feb. 1, 2012, the required annual payments increased to $525.

“The Zone Pass replaced high cost products that were typically entered into at properties after tours and lengthy sales presentations. The company historically incurred significant costs to generate leads, conduct tours and make the sales presentations. A single zone ZPP requires no upfront (additional) payment while passes for additional zones require modest upfront payments.

“Since inception, ELS has entered into approximately 22,000 Zone Pass agreements. For the year ended Dec. 31, 2012, the company entered into approximately 10,100 Zone Pass agreements, or a 36.5% increase from approximately 7,400 for 2011.

“In 2012, the company initiated a program with RV dealers to feature the Zone Passes as part of the dealers’ sales and marketing efforts. In return, the company provides the dealer with a Zone Pass membership to give to the dealers’ customers in connection with the purchase of an RV.

Since the inception of the program with the RV dealers, the company has activated 1,289 Zone Passes and recorded approximately $140,000 of revenue through the end of 2012, ELS reported.

Travel Resorts of America

One of the cabins at the Travel Resorts of America campground in Gettysburg, Pa.

Another major membership camping player is Travel Resorts of America, based in Southern Pines, N.C., which operates six resorts in the eastern half of the U.S. Sycamore Lodge near Pinehurst, N.C., was its original resort, followed by Gettysburg Battlefield Resort “which with the 150th anniversary of the Gettysburg Address is our busiest this year,” noted David Petsolt, director of marketing. “We have three resorts in Ohio, Wally World Riverside Resort, Rocky Fork Ranch Resort and Pymatuning Adventure Resort, each providing a different experience. Finally, there is Twin Lakes Resort in Florida.”

The company’s expansion has been driven by two factors.

“First, although most are within an RVer’s drive time of each other, each is in a diverse geographic areas and easily accessible from major metropolitan areas,” Petsolt said. “Secondly, we seek properties where we know we can create a top-tier experience for our visitors – the resorts have to have the right ‘bones.’ Our goal is to ‘Wow’ our visitors with something unexpected and provide the backdrop for them to create unforgetable memories. The Mohican Riverbanks at Wally World, the History of Gettysburg, the rich outdoor activities at Rocky Fork Ranch, the waterslides at lake at Pymatuning Adventure, the great fishing at Twin Lakes, and the world-class golf surrounding Sycamore Lodge (Pinehurst #2 is home to the 2014 Men's and Women's Opens) – each of our resorts has something unique to offer our visitors, all with a focus of fun.”

While the firm does not have any immediate plans for further expansion, it is always on the lookout for the next opportunity – “but it has to be something special,” he stressed.

Coast to Coast

Bruce Hoster, president of Coast to Coast Resorts

The turnaround has been very noticeable at Coast to Coast Resorts, an affiliate of Good Sam Enterprises LLC. Coast to Coast does not own any of its own parks, however, it maintains reciprocal agreements with 208 member parks which allow people who buy memberships through Coast to Coast to visit any of the affiliates’ resorts.

“People see the value in this. That’s why the business has come back,” explained Bruce Hoster, president.

Of the 208 resort firms, approximately 50 are active sellers of memberships, Hoster estimates. “A lot are older resorts now owned by homeowner associations or they just don’t sell new memberships,” he said.

Besides Ocean Canyon Properties, Midwest Outdoor Resorts and Travel Resorts of America, Hoster identified Outdoor Adventures, based in Bay City, Mich., and Colorado River Adventures, a network of eight resorts on the West Coast and based in Earp, Calif., as active and growing in the membership camping market. Indeed, Outdoor Adventures with its five resorts in Michigan has been the top seller of Coast to Coast memberships for many years, he said.

“Coast is showing some nice growth the past two years and is setting some records this year with our new Premier product,” explained Hoster. “Membership camping (finally) seems to be making a comeback, and it’s (finally) fun working on Coast to Coast. It’s always nice when the numbers are good.”

Hoster, who has headed the Coast to Coast network since 2007, attributes the rebound to RVers seeing the value in memberships compared to other ownership positions.

Coast to Coast offers three types of memberships, classic (entry level), deluxe and premier. The latter, filled with benefits and relaunched in summer 2012, has been key to Coast to Coast’s rebound, Hoster maintains.

Member parks have made considerable investments in recent years to either upgrade their parks or add new ones, thus giving campers more camping options.

For example, Ocean Canyon Properties announced in April extensive renovations totaling $1 million have been taking place to improve members’ camping experiences at six of their resorts.

This map shows locations of Coast to Coast Resorts in U.S.

Not Just for RVers

And membership camping is not just for RVers.

“We look for people who enjoy the outdoor lifestyle, probably age 35-plus and can afford the product. But you don’t need a camper to buy our product,” he noted.

Addink estimates that more than 50% of Midwest Outdoor Resorts members do not own their own RV. Instead, they rent RVs or covered shelter such as cabins and lodges at the resorts.

The love of the outdoors may be the crucial requirement for prospective membership campers. Minneapolis has a high percentage of RV owners, but even more so, it has a high percentage of people who enjoy the outdoors, Addink said. That’s why his company has a sales office in Minneapolis and operates two of its three resorts within an hour’s drive of there. It also makes for an easy trip to show prospects.

Pournoury’s Ocean Canyon Properties are strung out across the Southeast, making the sales presentation more problematic.

“There is no national ad campaign, no media advertising for membership camping,” Pournoury noted. “I’m sure if there was, there would be a lot more people coming to membership camping. Since the industry is so fragmented, the news does not get out.”

Still, he adds, “There are a lot of good operators in the industry that know how to market and how to cultivate their memberships. There is not much growth as far as new resorts joining membership camping because of that. It is a very tough field to master the marketing, the sales effort, the administration and the operations end.”

“It’s not just like opening an RV park and waiting for customers to come in. You have to go after them and grab the right kind for your product. If it is done the right way, it has a lot of rewards. Every company that is in the business and selling upward of 300 or 400 memberships a year is profitable and has been so for many years.”

 

[Slashdot] [Digg] [Reddit] [Facebook] [Google] [StumbleUpon]

Comments

Feel free to leave a comment...
and oh, if you want a pic to show with your comment, go get a gravatar!





*

Bottom