You Gotta Believe

Jerry Coates beams with pride as he shows off his new facility.
The 63-year-old RV dealer can’t help compare his new 25,000-square-foot facility, affectionately dubbed “Coates Country,” with his dilapidated old building. The Coates family invested more than $2.5 million on the 7.5-acre property, and its cabin-style appearance has already lured in many new customers. The result of all this grandeur? Coates expects to double his business within a year.
Not bad for a family who once deemed camper sales a fad.
Coates is like many dealers in the RV industry: He was eager to support an industry-wide marketing campaign, and he’s reaping the benefits of its success. At Coates Country, though, pride isn’t limited to inside the walls. It reaches out to those who can’t help but stare at the facility as they drive by on Interstate 35. It emanates from the pine décor in a welcome-home kind of way, and it is abundantly displayed in everyone from the owners to the new salesman.
According to Tom Faludy, this pride is a byproduct of the RV industry’s much-heralded “Go RVing” marketing campaign. In fact, says the man who founded the coalition that launched Go RVing, “combined with the solidarity that we now find within the industry … there’s no issue that fills us with universal pride like this one does.”
The RV marketing campaign began with two simple beliefs: The belief that its products and lifestyle provide an outstanding experience and that the potential market for those products was much larger than its existing customer base.
Many people in the marine industry have long held similar beliefs of their own products.
Although the two industries have many differences, there is a lot to learn from the RV industry, particularly through the eyes, experiences and successes of people like Coates and Faludy. Quite possibly the biggest lesson – and challenge – for the marine industry may just be believing in its own potential.
Faludy likens it to the report of a treasure buried in your back yard: The extent to which you believe there’s something worth getting is what will determine your actions.
“If you believe that all that’s out there is the customer you already have and that you’ve attracted all the customers you’re going to attract,” he asks, “what’s it worth?”
The boating industry needs to “try to quantify how high is up,” he continues. “Figure out what you have buried in the back yard. If you believe it, then act on your belief. If you don’t believe it, then move on.”
Now Or Never
Thanks to the RV industry’s high-profile effort, a national marketing campaign has now become the central topic of the marine industry’s multi-tier initiative to grow the market (planned to be unveiled this fall). Like the RV industry, though, the task forces that are working on the marine market’s plans are focusing on efforts that stretch across the most pertinent issues the industry faces.
And even Faludy acknowledges that the RV industry had some house cleaning of its own to do prior to its campaign launch. In trying to expand the RV market, leaders of that industry laid out the vision and vowed to enhance the experience they planned to promote: “We had to make sure that the market place that we enjoyed being in delivered on that promise,” he explained.
More than 50 people representing as many as 40 companies make up the marine industry committees that are focusing, individually, on Product Standards and Quality; Timely and Accurate Retail Sales Statistics; Dealer Standards and Quality; Marketing Communications; and Funding.
Individually, these committees stand to improve the boating experience. Collectively, the industry hopes to grow the boating pie.
The phrase “Grow Boating” has become the rallying cry for the industry, but the fact of the matter is that this industry has been here before. Previous attempts were squashed by a lack of follow through or vocal objections of one or more dominant market players.
This time, though, NMMA President Thom Dammrich, who has been appointed spokesman for the task forces, says it’s beginning to gain momentum. This time around, he says, there is a growing consensus among all major manufacturers that we can grow boating if we work together.
Gaining that consensus and working together to grow the proverbial boating pie have proven to be major hurdles. The RV industry, says Faludy, had its zealots on one extreme, skeptics on the other, and a host of undecided parties somewhere in the middle. And the marine industry is quite similar.
History has taught us that the big players in the marine industry have been less than enthusiastic to participate — after all, why should they help grow market share for the smaller players? And that’s to be expected, explains Faludy.
“Initially, it’s entirely controversial,” he explains. “But you have to look at how businesses grow, either by cannibalizing each other because the size of the market is fixed or by growing the market dynamically. That seems to be a better type of growth.”
The marine industry has spent almost 16 years merely changing the shape of each company’s slice of the pie while unit sales have plummeted, and consumers have turned to other recreational pursuits. And attempts at overall market growth have failed for one primary reason: a lack of support from a critical mass.
While Brunswick and Genmar may have had trouble agreeing to plans in the past, the two largest boat builders appear to be at least aiding in the most recent efforts. Despite the fact that Genmar CEO Irwin Jacobs told us last summer that he wouldn’t help fund a marketing initiative, Genmar President and COO Roger Cloutier is one of 12 executives sitting on the funding committee. He joins Senior VP of Marketing George Sullivan as Genmar representatives sitting on a task force. Brunswick, who didn’t play along last time such a campaign was attempted, has committed as many as seven people, including company president Dusty McCoy, and Mercury Marine president Pat Mackey to various task forces.
The solution is not rocket science. The secret is to give everyone a voice in an open forum and get everyone with a voice to respect everyone else with a voice, explains Faludy. Creating a town hall meeting of sorts, where issues can be debated publicly, separates those who are working toward the common good and those who are focused on serving their own needs.
“Objections that are thinly veiled in self interest become obvious,” he says. “The more you discuss and debate these issues in public forums, the faster you’ll solve the issues. Ultimately, it’s like any movement — there must be a handful of champions who don’t go away and who won’t let ideas die. They don’t let obstacles stand in the way because they are compelled by the vision of what they’re trying to achieve. And great ideas generate lots of champions.”
Championship Caliber
Whether or not the specific plan this initiative generates will be classified as a great idea, the concept of growing boating already has its champions. The most noticeable emerged last fall when Richard Strickler, the senior vice president of Transamerica Distribution Finance (now GE Commercial’s Marine Group), spearheaded a meeting among industry executives to discuss growing the market.
That meeting led to more discussions, and soon thereafter the task forces coordinated by the NMMA emerged. But in addition to the NMMA-sanctioned effort, another champion — or group of champions — that facilitated open forums is Peter Granata and the Marine Design Resource Alliance.
Created by a group of suppliers that decided to expound on an NMMA initiative to unite the industry through growth, the MDRA (see “Renaissance Alliance,” page 62) began with a series of town hall-type meetings. It then grew into a number of programs, events and a publication, all of which were tied together, according to Granata, MDRA’s president, to create a better environment for the marine industry to grow.
The most significant item that grew out of Granata’s not-for-profit alliance was the Creative Conference, an open forum for industry leaders to come together and discuss industry hot topics in a comfortable, yet productive manner. And the goal for this year’s meeting, according to Granata, was to move the dialogue forward on the long-standing debate of how to grow boating.
“After meeting, they decided that rather than just waiting for someone to do something, they would take the initiative and see if there was some grassroots efforts that they could involve themselves in and try to attract attention to the industry and improve it,” Granata explains. “Their idea was that if they could grow the pie, their slice would increase along with that growth, rather than just sitting their beating up everybody else and grabbing some of their share.”
One of the most notable results from the conference, according to NMMA’s Dammrich, “was a pretty broad-based show of support from the attendees that the time has come to work together to grow boating.” And Granata believes that that took some of the pressure off the NMMA.
“The responsibility was no longer solely on the NMMA,” he explains. “The meetings put a little more accountability on each boat manufacturer and attendee who took part. I think they begin to understand that together they have an awful lot of good ideas, and they don’t have to constantly rely on the NMMA to initiate major programs. There are a lot of small things that can be done to help our industry. And I think they walk away from there feeling a little more personally accountable.”
Everyone’s Accountable
Whether considered a champion for the cause or a converted believer, everyone who stands to gain from a Grow Boating campaign is accountable for doing their part.
Every good initiative begins with personal accountability, Granata says. The RV industry had Faludy and the Recreational Vehicle Industry Association. But as Faludy, who was on the board of the RVIA, branched out to gain consensus, he brought all of the industry associations together, and from the start, it was the dealer body, he says, that was the “greatest single constituency that said, ‘we want it.’”
“Frankly, the staff of any given industry association is ultimately not going to be the champion of something like this,” he explains. “It has to be the members. The association reflects its members’ desires. It doesn’t necessarily institute what those desires should be. For me, it’s up to the people within the industry to want it, and frankly, to press their association and other factions of the industry to want it.”
Granata agrees.
“It’s wonderful to have the NMMA,” Granata says. “It’s an organization that we definitely need, and they do a great job of helping us lobby in Washington and maintain a kind of watchdog stance. But I don’t think that the NMMA members should constantly rely on the NMMA to initiate everything.
“People who belong to the organization need to pick up the gauntlet on their own once in a while and find some additional efforts that they can become involved in and help our industry without constantly beating up on the NMMA.”
Although the NMMA is coordinating the Grow Boating initiative, it’s important to note that the effort is designed to bring all sectors of the industry together. Every segment of the supply chain has been given a voice, and it’s up to those 50-some individuals who are part of the task forces to speak, loud and clear, just as the members of the boating community at large should do.
Dammrich also believes that in order to achieve success this time around, everyone must be accountable. Boat, engine and accessory manufacturers will be asked to improve product quality. Dealers, marinas and boatyards will be looked to for sales and service quality upgrades. Timely and accurate retail sales statistics will be gathered by dealers and boat and engine manufacturers. And when it comes time to fund a marketing communications strategy, the entire industry will be asked for help.
Dammrich is a believer. Through his own experiences, whether spending time on the water or at the Discover Boating and Fishing Mobile Marketing Tour, he personally believes there is a great opportunity to grow boating.
“We’ll sell more boats; we’ll sell more accessories, and in the process,” he predicts, “we’ll also bring the industry together with a focus on doing the right things, doing the things we need to do to improve the consumer experience so that boating does grow.”
Beyond that, however, it’s up to individual companies to also do the right thing, says Granata.
“Individual companies have to do the right thing in terms of product, service and sales quality,” he says. “Fortunately, there’s a heightened awareness that there are many things that individual companies can do, even in small efforts, to help our industry grow.”
United We Stand?
Tom Faludy knows from experience that you need to clean your house before you invite people in. The RV industry took that mentality and developed an “extensive excellence program” to make sure that its individual businesses delivered on the collective promise that its marketing campaign made. And he recommends that the boating industry follow suit.
“Once a consumer finds the product, will he be happy enough to be a long-term customer,” Faludy asks, “or are you simply inviting him to a party where he’s going to get sick?”
The marine industry seems to understand this basic concept. The five-part program by no means is focused entirely on a marketing campaign. It also aims to improve product, sales, service, and the entire boating experience. Unfortunately, there have been enough hassles over the years that those consumers once desiring to be long-term boaters have left to pursue other interests.
Before the initiatives are put in place to help attract old and newcomers, however, Faludy advises that the boating industry quantify its potential consumer base.
“Before you sell something, you have to do two things,” he explains. “You have to make people generally aware of the product and you have to make sure they are favorable of the product.”
The marine industry, it seems, is on top of that issue. Not only are committees researching the topics up front, but they have also recognized gaps in their information. Finding answers to awareness levels, who the general boater is and why he enjoys boating, what keeps people away from boating, what other things are competing for discretionary time and money, and how consumers shop for boats are of utmost importance to the strategy task force.
Although at press time, the task forces had yet to complete their research, Dammrich says, it will be compelling enough to help refine the target and the message — two very important factors for gaining consensus, according to Faludy.
“In order for [champions] to find converts, they have to have evidence,” he says. “I think the evidence we had … was very, very helpful in getting people to understand what’s really buried in the back yard.”
Ah, what’s buried in our back yard? That’s really the bottom line, isn’t it? Hopefully the research will spell out the true potential for the marine industry, and hopefully, it won’t prove to be too little, too late. The RV industry, although in the catbird’s seat now, wasn’t always there. In fact, that industry may have been worse off than ours.
After Faludy and company launched the initial plan in 1994, it took two years to gain a consensus that their ideas were the right way to go. And by the time the campaign first aired in 1997, it had been 20 years since the peak of RV unit sales.
The marine industry has been tossing this idea around for the better part of the last decade, perhaps longer. But there’s never been a concrete plan to back it up. If these task forces are successful in presenting the plan to the industry at the International Boatbuilders’ Exhibition & Conference this fall, it will have been 16 years since the peak of the marine industry. Following the same timeline that the RV industry experienced, we’d be looking at 2006 before gaining consensus and launching a program.
Given the way ideas are falling into place and consensus is brewing, it could be much sooner than that. At the MDRA conference, the discussion revolved more around how the campaign should be funded, rather than the merits of creating it.
In the end, funding the program — or collecting the funds —may be the most difficult topic.
The RVIA program has been funded by the manufacturers, who attached a small surcharge to every unit built, and it has been assumed that the surcharge has been passed on to the customer. During the first phase of the RV program, all companies paid the same rate, and those rates doubled during the second three-year campaign. And, again, during the third, three-year phase, the rates increased, but this time disproportionately on the high end.
The first RV campaign began with a $3 million annual media budget. At the time, that was four-one-hundredths of one percent of industry-wide annual revenues. The success was so clear that the RV industry has voted unanimously to increase funding each time. By the third campaign, which began last year, the annual budget was somewhere between $13 and $15 million. Currently, the industry is working on plans for Phase IV.
In the marine industry, $3 million dollars for the first year of a campaign would equate to one-one-hundredth of one percent of total marine industry revenues. For the marine industry to invest 4/100 of 1 percent, it would need to invest nearly $12 million. And Faludy suggests the boating industry would need to commit $10 million.
NMMA officials wouldn’t be specific about budget intentions, as Dammrich said it’s too early to say. NMMA has been searching for an agency to help build the message, though, and in a request for proposal the organization submitted to search consultants, it estimated that it would spend between $5 million and $15 million. Even a $15-million investment doesn’t seem like a lot for the kind of results the RV campaign produced.
In the first year of the RV program, there were 8 million consumer participants. That figure is now up to 20 million. And last year alone there were 150,000 qualified leads as a result of Go RVing.
Once a much more mature industry that RV businesses looked up to, the marine industry now finds itself attempting to generate that kind of interest. As a complement to the industry’s bottom line, though, working together to accomplish this marketing mission may mean much more for boating companies across the nation, Faludy suggests.
“In addition to the RV industry growing faster than any other industry and faring well through a varying economy,” Faludy explains, “there’s been another byproduct that has been phenomenal, and that is the unity that came out of this. It has really helped mature our industry at a much faster rate. Once we saw ourselves on primetime, and we saw these phenomenal images of the good that our products provide, we saw ourselves in a different light. And when you see yourself in a different light, you expect more from yourself. It’s like a higher calling for a greater sense of responsibility in order to provide that world-class experience.”

Setting Standards
The five-part initiative to Grow Boating.
The initiative set forth by industry leaders is not merely a marketing promotions strategy. The five-part effort hopes to ensure that boating consumers will not only be drawn to the sport, but that they will also enjoy it and want to remain involved with it.
While the plans have been pushed back from the original introduction, NMMA President and spokesperson for these task forces Thom Dammrich says the groups are ensuring that they are accurate and complete, rather than rushing through the process.
“We are taking our time and doing our homework and making sure we’ve got it right,” he says. “We’re more concerned about doing it right than doing it fast.”
The following outlines the five task forces and their primary focus, in addition to their current status. Dammrich says he hopes that there can be a major presentation made to the industry at IBEX (Oct. 25–27) this fall.
Product Standards and Quality
As reported on www.boatingindustry.com, this task force is already moving into an implementation stage. Working in conjunction with the American Boat & Yacht Council, the task force has identified 11 additional ABYC standards that should be included in the National Marine Manufacturer Association certification standards. Additionally, it has recommended that NMMA require all of its boatbuilder members to be NMMA certified by model year 2007. Finally, the task force recommended that, as an element of certification, members should include some sort of customer satisfaction program, whether by using J.D. Powers’, NMMA’s, or their own. Members of this task force include: Chip Shea (Chairman), Advance Marine Technologies; Chris Dawson, Bombardier Recreation Products; David Marlow, Brunswick Boat Group; Gary Briggs, Minnetonka Marine; George Bellwoar, Perko; Jim Hubbard, Mercury Marine; J.J. Marie, Zodiac North America; Mike Randolph, Bombardier Recreation Products; Scott Deal, Maverick Boats; and Skip Burdon, ABYC.
Timely & Accurate Retail Statistics
This task force has been charged with figuring out how to measure retail sales in a timely manner with the goal of gauging the results of any marketing efforts. To date, outboard engine warranty cards have been the most useful for tracking sales, and the task force is planning to add questions regarding the boat sold with the engine to begin the new research. This process requires software and printing updates by the outboard manufacturers, and Dammrich says the hope is to implement this by January. Once it is up and running, he says, work will begin on a similar program for inboards. Members of this task force include: George Sullivan (Chairman), Genmar Industries; Gus Blakely, American Suzuki Motor; Bret Bretnall, Raritan Engineering; Jim Hubbard, Mercury Marine; Brett Keating, U.S. Marine; Ben Landis, Volvo Penta; Kenneth Landon, Key Bank USA; J.R. Means III, Bayport Yachts; Chuck Rowe, Indmar Products; Bob Selig, Davis Instruments; Ben Speciale, Yamaha Group, Richard Strickler, GE Commercial Distribution Finance; and Bruce Van Wagoner, GE Commercial Distribution Finance.
Dealer Standards & Quality
The newest of the task forces, Dammrich says it will focus on improving the sales and service efforts by way of establishing a set of standards for dealers. It may eventually lead to certification of dealers. “We want to be able to drive consumers to certified dealers to buy certified boats,” Dammrich says. “That’s the most likely way to ensure a positive experience.” The task force is aiming to have a plan of action by fall, and that may include a customer bill of rights and responsibilities. Members of this task force include Larry Russo (Chairman), Russo Marine; Jeff Scherer, MarineMax, Inc.; Tom Johnson, Reed’s Marine, Inc.; Jeffrey Going, Zodiac of North America; David Marlow, Brunswick Boat Group; Robert Lumley, Bombardier Recreational Products; Mike Gyorog, Mercury Marine; David Grigsby, Yamaha Motor Corporation; Bob Reich, Sea Ray Boats, Inc.; Phil Keeter, Marine Retailers Association of America; and Terry Leitz, National Marine Manufacturers Association.
Marketing Communications Strategy
The first goal of this task force was to look at all the available research to learn as much as it could to develop the strategy. After finding — and filling in — some gaps in the research, the task force hired a consultant to identify an agency to help develop that strategy. Dammrich said the task force was hopeful to have a strategic marketing program to present to the industry by late fall. Members of this task force include: John Dorton (Chairman), MasterCraft Boat Company; William Barrington, US Marine; Maurice Bowen, Tracker Marine; Dale Barnes, Yamaha Motor Corporation; Marty O’Donohue, Marinco Recreational Group; Tom Carey, West Marine; John Hoagland, Mercury Marine; John Underwood, Lockwood Marine; Tom Stidham, Norris Marine; and Chris Dawson, Bombardier Recreational Products.
Funding
It appears as though NMMA expects the campaign to cost anywhere from $5-$15 million, and the funding of this part of the program has been one of the most hotly debated. Dammrich says that this task force is making progress and also hopes to have a plan in place by late fall. Members of this task force include: Ken Burroughs, Tracker Marine; Roger Cloutier, Genmar Industries; Phil Dyskow, Yamaha Motor Corp.; Tommy Hancock, Sea Pro Boats; Roch Lambert, Bombardier Recreational Products; Jim Lane, Chaparral Boats; Pat Mackey, Mercury Marine; Dustin McCoy, Brunswick Boat Group, Clint Moore, Volvo Penta; David Slikkers, S2 Yachts; Jeff Stone, Yamaha Boats; and Maurice Bowen, Tracker Marine.

A look into the crystal ball
Success for the Go Rving campaign didn’t happen over night. In fact, the RV industry overcame a number of challenges—much like those that the marine industry faces—including a two-year lag from the time of the concept’s introduction and industry-wide consensus on the strategy.
Below, you can see the trend that the RV industry followed over the 10 years after the launch of the first Go RVing campaign. With the marine industry’s plans set to be introduced at IBEX this fall, we thought it would be interesting to lay out a timeline of the RV industry’s ups and downs. It’s not too difficult to imagine what the marine industry could accomplish over the next 10 years.
GO RVing Campaign Timeline
–1994 Launched program
–1996 Gained consensus on program
–1997 First airing of advertisements
–1998 RV Unit shipments increase 15%, retail value grows $1.4 billion.
–1999 RV Unit shipments increase 9.7 percent to exceed 300,000 total for first time since 1978; retail value exceeds $10 billion for first time ever.
–2000 & 2001 unit shipments slide total of 20% over two years; retail value dips to $8.6 billion
–2002 Unit shipments and retail values skyrocket. Shipments up 21%; retail value up more than 27%.
–2003 Shipments reach second-highest level since 1978, and retail value sets all-time high of $12 billion.
–2004 Estimates suggest shipments will grow 7.7 percent to nearly 350,000 units.
–And beyond: According to RVIA Web site, “long-term signs point to substantial RV market growth because of favorable demographic trends … number of RV- owning households is estimated to rise 15 percent during 2001-2010, to nearly 8 million.”

Renaissance Alliance
The Marine Design Resource Alliance was founded on August 13, 1997, by a group of suppliers who got together and decided to expound on an initiative that was laid down by the NMMA when it was attempting to unite the industry through growth. These suppliers decided that rather than waiting for someone else to do something, they would take the initiative upon themselves and see if there were some grassroots efforts that they could involved themselves in to attract attention to the industry and better the industry.
“They just decided that if they expanded the marine industry,” explains Peter Granata, president of the MDRA, “they’d be better off and so would the industry overall.”
So the MDRA (www.mdra.biz) began with a series of meetings and quickly grew into a number of programs and events and a publication. According to Granata, they were all tied together in “such a way that there was a synergy to hopefully create a better environment for the marine industry to grow in.”
The MDRA created such programs and products as Color Waves, which identified popular and emerging colors to act as a guide for color selection in the marine industry; Draw Kids to Boating, which involved children in drawing their vision of the boat of the future; Concept Boat, which involved various boat manufacturers to create concept boats; Designer Scholarship, a scholarship program for selected design schools in hopes of developing boat designers of the future; and Marine CEO publication, which focuses on leaders in the industry.
The final piece to the puzzle was the Creative Conference, an opportunity for boat manufacturers to discuss industry issues in a comfortable setting.
“We felt that if we could give them a forum in which they were able to talk as equals,” Granata explains, “that there may be a lot of good things could come out of their discussions that could be advanced in the boating industry, either by themselves through their own businesses or collectively as an industry we might be able to pick up on some of their thoughts and ideas and promote them effectively.”
The forum does not require the manufacturers to contribute financially, a strategy that Granata says allows the group to discuss issues on a level playing field rather than having one or another carry more weight. The suppliers, then, are the ones who pay for the open forums.
Each year the forum grows a little bit, Granata says, despite the fact that it is not heavily promoted.
“I guess the goal is that its kind of a renaissance forum,” he says. “We’re not about making money; we’re actually about spending money. But we’re about spending money in a way that is as effective as possible to create some positive things in the industry.”

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