Editor’s Note: The following is a “letter to the industry” from Gary LaBella, vice president and chief marketing officer for the Recreation Vehicle Industry Association (RVIA). In a followup to his May release outlining tactics and strategies for the year, LaBella offers an assessment of results from RVIA PR efforts in the face of adverse economic conditions along with an update on the Go RVing campaign. LaBella also offers a look to the future as to what steps need to be taken and what issues need to be addressed in the coming year.
At the end of May, I wrote to the industry about our marketing plan for these trying times. It was based on a widely held conviction by many in the industry that continued vision, resolve and perspective, combined with aggressive RVIA PR and Go RVing advertising efforts, are needed to maintain consumer RV awareness and demand in this unnerving economy.
Today, I’m writing to share the results of our PR and Go RVing efforts, results produced despite the dramatic declines in the industry assessments that fund the lion’s share of these programs. I also want to examine what next steps are being considered to maintain the impact of Go RVing and PR programs as we head into a new year filled with even more economic uncertainty.
First, let’s begin with the question: What really happened to travel in general and our industry’s image in this summer of volatile fuel prices, an economy in turmoil and historically low consumer confidence? Based on our research and analysis of key indicators.
• The RV market is down but not out. It is true that 2008 shipments are forecast to fall by 24% to 266,800 units; however, to look at it in a more positive light that means that 76% of the market still remains.
• Americans did not cancel vacations in general. A widely reported “staycations” trend, with people using their time off from work for home-based recreation and leisure, did not materialize. In fact the Travel Industry Association (TIA) reports that only 9% of adults are planning such a home-based vacation as an alternative to a vacation they would have otherwise taken out of town within the next six months.
• RVers still hit the road, albeit with some adjustments. According to our post-summer Campfire Canvass survey, 48% said fuel prices did not affect their plans at all. Citing both fuel costs and financial concerns, others told us they continued to enjoy RVing, but adjusted by taking fewer trips or staying closer to home. An impressive 80% said they were able to keep RVing because “RV vacations cost less than other options.”
• Campgrounds and RV rentals held their own as campground business remained steady, down only slightly from a record year in 2007, and rentals were “flat to slightly up” overall for the summer, according to the largest rental dealers.
Granted this may not portray a booming travel market, but it certainly does not support the bleak vacation outlook painted by the media at summer’s onset. We believe that our aggressive PR defense of the industry’s image and appeal helped to influence media thinking and coverage of RV travel.
PR Initiatives
As the travel season began, the media seemed ready to adopt a storyline that high fuel prices were dramatically reducing RV sales and causing RV owners to keep their RVs parked. Early on, stories tended to focus more on fuel prices, cutbacks, and “pain at the pump” than on the adjustments RVers were making and the savings they still enjoyed.
RVIA pushed back with timely, incisive and actionable research, including our Campfire Canvass Survey of RV owners’ travel intentions. This research became the basis for robust messages that led to fact-based stories in major media from the Asoociated Press to the Wall Street Journal to NBC Today, demonstrating that RV travel is the best value and that RVers are still hitting the road. While stories generally mentioned high fuel prices, they also included data from our findings, showing that RVers adjust by staying closer to home and driving fewer miles.
Another key weapon in our arsenal was the latest Vacation Cost Comparison Study by PKF Consulting, which showed that families save substantially by vacationing in an RV instead of other travel alternatives. The study received widespread coverage with many reporters, including NBC’s Peter Greenberg, highlighting the point that RV savings continue even when fuel prices rise. Greenberg told viewers that RV rentals are up this summer because smart travelers know they can save money by hitting the road in an RV.
Many reporters cited summer data on campground bookings and RV rentals to suggest that primary demand remains strong, but RV sales are being postponed because of tightening credit and the difficulties on Wall Street.
GO RVing Update
As economic conditions deteriorated throughout 2008, Go RVing’s media budget gradually shrunk from $16 million to a final total of $11.7 million. A serious cash flow crunch forced us to cut lead-generating cable, print and online advertising severely and stop running media entirely in late August following the Olympics. The cuts have caused leads to fall by about 30% so far. Despite our expanding emphasis on lower-cost social media, a continued drop is to be expected for the remainder of 2008.
But let’s look at what was accomplished:
• We invested millions in high profile media that made 1.62 billion impressions among our 30-64 target audience.
•We had a big presence on the biggest TV event in history, the Summer Olympics.
•We gathered 142,000 plus leads this year, nearly three-quarters from non-owners (a bigger proportion than last year).
• We attracted nearly 2 million visitors to our website and introduced a new Go RVing blog.
• We shifted our web messaging to emphasize the value of RV ownership and travel, in an attempt to convince consumers that now is a good time to make a purchase.
• We began modifying our current print ads to add new headlines promoting “value” and to drive people to the website to learn more about the reasons to buy now. These ads will begin running when the budget permits us to resume advertising in 2009.
The bottom line is that in a year fraught with diminishing consumer confidence, volatile fuel prices and a severe credit crunch, RVIA’s PR efforts and Go RVing worked in tandem to maintain the image and public awareness of RVing.
Go RVing messages continued to attract strong consumer interest, and the campaign helped build up long-term demand in a time when all kinds of discretionary purchases are being postponed.
RVs maintained their positive media image. The downturn in sales has been portrayed as a broad economic issue that affects many industries rather than as a fundamental problem with RVs with reporters continuing to cover positive aspects of the RV lifestyle as well as the substantial savings for families traveling by RV.
Where Do We Go From Here?
There’s a pervasive feeling among many industry leaders that the unavoidable extension of the “What Will You Discover? Go RVing” campaign creative into a fourth year in 2009 is enough. Their hope is that steps can be taken to ensure that Go RVing has the resources needed to produce new ads to run in 2010 – when the economy is expected to improve.
To that end, at the upcoming National RV Trade Show in Louisville, the Go RVing Coalition will hold a high-level discussion of how the Go RVing initiative can best serve our industry in the next three years. We are seeking input from the industry on what the marketing objectives, consumer messages, funding level and spending priorities should be, for 2009, for the next phase of the campaign starting in 2010, and for the long-term growth of our industry.
We will examine the best approach to public relations, marketing and societal challenges that are likely to impact the image and appeal of our product to the media and the public, including:
• The availability of credit to our buyers
• The availability of tow vehicles
• The impact of fuel prices on product development
• The green movement’s impact on consumer buying preferences
Setting the stage for this pivotal discussion will be “Outlook 2009: We’ve Got Heart!” – the market expansion showcase event kicking off RVIA’s National RV Trade Show on Tuesday, Dec. 2, 2008 at 6:30 a.m. in the KEC South Wing Ballroom, where will touch on these critical issues.
We also invite attendees to visit the Go RVing booth in the main lobby where we will be interviewing campaign stakeholders to learn how Go RVing can best support their businesses in this tough market.
As we look ahead to gathering in Louisville, we find ourselves in uncertain economic circumstances. But this situation is not unfamiliar to our industry. We’ve been through difficult times like these before…tough conditions brought on at various times by falling consumer confidence, oil embargos, credit crisis, and other market maladies. We can take heart in knowing that the historical trend is for the RV industry to come roaring back stronger than ever after down periods. By staying committed with our PR and Go RVing programs, I’m confident we will overcome these short-term market challenges and set the stage for growth as the economy and RV industry begin to recover.