Voices

The Reality of Unmet Expectations

by Jim Calderbank

This is a great time to be in the RV industry. Consumer confidence is high, the economy is good. Although interest rates and gas prices have tempered the celebration, the guest of honor is just walking through the door, the Baby Boomer. With so many hopes and expectations pinned to this well-identified market, it is hard not to be excited. Witness the RV Industry's continued march of record profits as this key RV buying segment grows, and perhaps doubles by 2015. Coupled with the massive increase in wealth that Baby Boomers are experiencing, the RV Industry's expectations should be high. However, what are the Baby Boomer expectations? What happens to our industry if Baby Boomer expectations go unmet?

We don't have to guess what the Baby Boomer does when expectations go unmet -- the history is very clear. They take their money and go elsewhere. Baby Boomers demand better quality. They demand a product that is trouble free, easy to use, and easy to service. They expect a pleasant experience throughout the ownership cycle from purchase to campsite. To this end, Baby Boomers force entire industries to change using the power of their buying choices to get a product or service to meet their expectations. Industries that don't change or change late watch revenues, profits, and markets dry up. Cruises and the auto industry are two examples of industries that adapted to the Baby Boomer market. The question is can the RV Industry? Will we talk about change and fail or implement change and succeed?

Many of us remember the changes that occurred during the Japanese invasion and the quality changes forced on the American car industry. The Chrysler Corporation needed a government bail out to survive; Ford and General Motors limped along and lost market share. Few though remember the Japanese quality problems with paint and suspensions ill suited for American roads. The Japanese took advantage of the gas crises, improving and adapting to a new and different market. They increased the quality and reliability of their product. They turned 'Made in Japan" into the symbol of quality instead of the symbol of cheap goods. In the midst of success they reinvented themselves again, developing the reliable luxury cars Acura and Lexus, further enhanced with exceptional service to satisfy the evolving Boomer appetite. Most important the Japanese taught the American consumer the first lesson the RV industry needs to implement to survive, when you turned the key to a Japanese car it worked. In fact it worked better than the American car buyer expected. This taught the Baby Boomer a second lesson; expectations not only should be met, but exceeded.

American car manufacturing was failing while Baby Boomers embraced concepts learned from the Japanese, quality and reliability. Baby Boomers spoke loud and clear, companies and industries that don't "get it" will fail. However, what really allowed small Japanese cars with no options a foothold in America was the gas crises. Americans tried the Japanese offering because there was no alternative to the car and the freedom it allowed. So the consumer could not flee to "alternative transportation" which was too expensive, too cumbersome, or non-existent. The RV industry does not have this luxury. A consumer, especially a Baby Boomer, will flee to any one of a number of RV lifestyle alternatives as their wants, needs, and expectations go unmet by the RV industry.

The cruise industry has spectacular Baby Boomer market penetration by practicing customer centered service, constantly changing its product to survive and grow with this market. Bigger ships and tremendous competition within the industry forced prices down. In tandem with advertising, this changed the perception from cruising was only for the rich to cruising was the fun, affordable getaway. The industry used comment cards as an integral part of a product improvement process that spotted problems early, identified changing consumer trends, and implemented programs that were ahead of competitor leisure industries. As a result the food, service, and entertainment quality improves continually. New ships are built, old ships are refurbished, itineraries are changed, and cruise themes developed for different market segments. Cruises are easy to purchase, one phone call or Internet click and everything is taken care of for you. The cruise industry understands their target market's expectations, continually acts to meet those expectations, and provides a total experience for each customer from beginning to end. A cruise experience that meets expectations is not an accident or deft marketing. it is as simple as asking the customer what they expect and then acting to implement changes to meet a moving standard.

Will our industry fail? My personal opinion is no. Due to the sheer numbers of Baby Boomers the RV industry will continue and earn a share of the leisure industry dollar. It may get painful as Baby Boomers force the RV industry to change; the Boomers expect our industry to bow to their will as others have before us. This of course is not a ringing endorsement. Why can't we take full advantage of this potential market? Why do I see a less optimistic picture than most? Predominately two reasons.

First I studied and worked in the auto business and know how painful change was for the world's largest corporations. As painful as the changes were it was only when the pain of continuing was so great, the threat of failure so real, that painful changes were implemented instead of talked about. The changes needed by our industry are whatever is necessary to deliver a trouble free, easy to use, easy to service product that gives a total experience from the purchase to the camping site that meets and exceeds the buyer's expectations. Anything less and the RV industry will never experience the hoped for rewards of the Baby Boomer market. Change is painful, many have the vision of change but lack the will to implement it. The RV industry alone will determine how much pain is felt before this goal, to provide the product and the experience Baby Boomers expect, is achieved.

The second reason that gives me the clearest picture of the opportunities that lay between today's reality and tomorrow's success is listening to the customers themselves. When I work the shows, train at dealer's lots, and go camping I talk to our customers; I listen to our customers. Contrast the glowing industry projections to my phone call from a 45-year-old Baby Boomer I met while camping, asking what he can sell his coach for. He tells me he is selling his coach because he is tired of the problems, tired of the service, tired of the stress. I asked him to trade it in for one of mine, I would help him. He told me this in reply, "No way. Every time I get ready for a trip, something goes wrong". He went on to say when he tries to get the RV fixed they only fix half of what is on his list and congratulate themselves for that! On the road he is in fear that every strange noise, beep, or shudder is something else that has broken. His wife hates the thing, offering to fly ahead and meet him. He said he bought it to relieve stress, not create stress. Finally he said he can think of a lot better ways to spend his time off and a lot better ways to spend his money. He is the most frustrated owner I've met, but not the only one. I might not be the sharpest knife in the drawer, but I think we have lost this customer for good and others like him because of unmet expectations. As other industries change to compete for his leisure dollar can we afford to be left behind? A trouble free, easy to use, easy to service product supported by an industry with an implemented strategy to provide an exceptional experience from the purchase to the campsite would have held on to this family and even captured some of his friends.

Will we as an industry "get it"? Will we have the will to change our culture into one capable of turning potential into profit? There are examples of those that "get it" in every area of our industry. Unfortunately to the Baby Boomers their impression is only as strong as our weakest link, only as good as the last unmet expectation. This reality makes me pause.

I had the pleasure of visiting with John Crean at his home sometime back, listening to him, learning from him Today as I write this I think of the industry Mr. Crean, Mr. Hanson, Mr. Byam, and countless others, built and turned over to us to safeguard and grow. The industry that we work in so more people can enjoy this wonderful lifestyle. We provide freedom, joy, and rewards to those that are part of the RV Family, especially the camper. The family that works hard to make monthly payments on a tent camper to the person that writes a check for a Prevost. For these campers, the RV experience is a lifelong dream, a goal that they worked hard to achieve. We have met these people at shows and rallies, they are the reason we exist. Should we work any less hard to change what we must change so the next generation, the Baby Boomers, can enjoy it too?

RVN