O’Rourke Notes Positives, Headwinds at KOA Convention – RVBusiness – Breaking RV Industry News

Toby O’Rourke, president and CEO of Kampgrounds of America Inc. (KOA), kicked off the annual KOA Convention on Tuesday (Nov. 19) by highlighting the positives in a year marked by slower traffic at campgrounds nationwide.

She noted that KOA’s NPS score, a data set used to measure guest satisfaction, had moved up one point in 2024 to 71. That is up from 70 in 2023 and significantly up from 53 in 2011 when the company started measuring NPS.

Total system registrations over a trailing 12-month period are still up, marking a record for the company at over 5.6 million, while year-end registration numbers are on par with last year’s record numbers.

When it comes to registration revenue, O’Rourke explained that 45% of parks were ahead in 2024, while 11% were flat and 44% were behind.

Toby O’Rourke

On the overall revenue front, O’Rourke noted the complex balance that exists between occupancy numbers and revenue.

“We can see what a unique year it has been,” she said. “Twenty-seven percent of parks are ahead of last year in terms of occupancy, 8% were flat and 65% were below in camper nights. On stage last year I talked about a goal to increase camper nights by 2%, but overall, we saw decreasing nights again this year.

“Half of our parks are above occupancy from 2019 and half of our parks are below,” O’Rourke added. “When you see these numbers, it underscores how impressive revenue growth has been. During this same cycle, we’ve increased revenue by 134%. Parks have found ways to increase their ADR despite decreasing occupancy. Ninety-two percent of campgrounds have increased their overall revenue during this pandemic cycle. The fact that KOA continues to grow despite lower occupancies speaks volumes about our value. Campers are looking for experiences and we are here to deliver.”

Of course, everyone is wondering when the decline in occupancy will reverse itself and O’Rourke said it isn’t an easy question to answer.

“We’re not alone in these occupancy declines,” she explained. “All of our peers across the industry are seeing the same levels of decreases, if not more. There are a lot of macro-level factors at play.”

O’Rourke highlighted that international travel is up 33% from where it was in 2019 with one in five people saying they plan to travel abroad in the next 12 months. Inbound international travel on the flipside has not rebounded and is still lagging behind 2019 levels.

Cruising is also up 6% over 2019 with 10 million new cruisers in the past few years and a younger demographic.

KOA’s President and CEO Toby O’Rourke gives a speech during the convention.

“I think all of these factors have had an impact, but I also think it’s a short-term headwind,” she said. “This business is going to return. We haven’t lost the camper. They’re simply taking in other forms of travel that were more heavily impacted during the pandemic.

“Cruising and international travel is expensive and that was taken in by those who could afford it, and that is a proportion of our camper base,” O’Rourke added. “But another trend that I’d like to talk about is this disparity we’re seeing in travel behavior between lower-income households and upper-income households.”

She highlighted credit card debt is at its highest level in 12 years and personal savings are dropping, with lower-income households experiencing the most pain from higher inflation.

“That impacts a significant portion of our camper base with 36% of our campers having an average annual household income of $50,000 or below,” O’Rourke noted. “Fifty-nine percent of our campers have a household income of below $75,000 and one-third of campers feel that their financial situation has worsened this year.”

All of this, she told attendees, impacts discretionary spending and how people travel.

“Families are making tough decisions about how and where to spend their money, and for many, that means looking at their travel budgets,” O’Rourke explained. “We see KOA campers opting for shorter stays, camping closer to home, looking for discounts, looking for promotions or seeking out lower-cost camping options. Half of our campers said that inflation has caused them to wait longer to book, and they’re not buying new RVs.”

She also addressed the fact that park owners are also feeling a financial pinch in their wallets.

“Your expenses are increasing, and your margins are being compressed,” O’Rourke said.

Time to Rebound

O’Rourke explained that it is time for park owners to realize that the playing field has changed and that it is no longer business as usual.

“When the playing field has changed, we need to change the game,” she noted. “We’ve been in this cycle long enough. There’s a lot of talk, we’re always looking backward, we’re always comparing. It’s time to move on, look forward and move this cycle back up and start a new business cycle, set a new baseline, and grow from there, and to do that, we need to change the game.”

O’Rourke told attendees that it isn’t just campgrounds that parks are competing against. It is every option in a particular market that people can choose to spend their time and money with.

“Camping has always been a budget-friendly alternative to travel, and we need to lean into that strength,” she explained. “We need to get existing campers to camp more. One more night, one more stay. We need to bring new campers in, and appeal to those who want to take a vacation but aren’t sure they can afford to take a cruise or go to a theme park this year.

“COVID brought so many people to camping, so they already have context and experience about being outdoors and they might be doing something else right now, but it is not hard to remind them about the fun they had and invite them back,” O’Rourke added.

Hundreds of park owners/operators are in San Antonio for this year’s convention.

What is the Game Plan?

O’Rourke said that the KOA system was going to lean into value to attract cost-conscious campers.

“We need to send a clear and authentic message that KOA is an affordable, high-quality experience that’s worth every dollar,” she noted. “Our amenities and our services need to reflect that value, build loyalty and differentiate in a crowded marketplace. When dollars are tight, campers, like all consumers, are selective in what they choose to do. They will look for brands that deliver a sense of trust, reliability and value.”

O’Rourke said the company is also going to leverage its loyalty program, KOA Rewards.

“KOA rewards offer substantial value not just in building revenue, but in securing long-term relationships,” she highlighted. “When faced with options, a loyalty program will provide competitive differentiation.”

For KOA, campers who are a part of the KOA Rewards program account for 59% of all camper nights.

O’Rourke also highlighted how parks can leverage recent travel trends to give people a reason to come to a particular park, drive more revenue through better revenue management and take advantage of the KOA marketing team, which has seen tremendous success in making sure KOA parks are ranked higher and are easier for campers to find.

Convention Highlights

Besides O’Rourke, other KOA officials including Diane Eichler, senior vice president of marketing; Andy Metroka, chief information officer; Aaron Williamson, vice president of franchise services; Kim Wootteon, vice president of commercial strategy for KOA; and Mark Lemoine, senior vice president of franchise operations; all spoke on different projects KOA is focused on to improve the system and help franchisees continue to grow.

Ryan Estis gave a keynote speech during lunch on Tuesday that focused on human-centered leadership and how park owners can pour into their staff and campers to create a better hospitality mindset and park.

Workshops were also held throughout the day on Tuesday, along with an event supporting the KOA Owners Association (KOA) in the evening.

Today (Nov. 20), KOA will be handing out its new ICON Awards, which will celebrate the parks at the very top of the system as it relates to customer service and performance. During lunch, KOA will be handing out its Presidents and Founders Awards, Rising Star Award, Park of the Year Award and Partnership Awards.

Workshops will also be held throughout the day, along with the opening of the expo this evening. The expo is expected to have more than 145 booths and will include a full camp store set up this year to help KOA train franchisees on how to better operate their stores.

The convention is set to wrap up on Thursday.

Source: https://rvbusiness.com/toby-orourke-notes-positives-headwinds-at-koa-convention/?utm_source=rss&utm_medium=rss&utm_campaign=toby-orourke-notes-positives-headwinds-at-koa-convention