Are you wondering why it so hard to find open camping spots in 2021? And what about the confusing and always changing prices being charged for campsites?
The problems are widespread and growing.
And while there are a lot of causes, you have to wonder if the challenge of finding open camping spots this year is going to take a toll on the millions of new campers out there who are frustrated by overbooked, overfilled and expensive campgrounds.
That's what we talk about in Episode 350 of the RV Podcast. Be sure to keep reading this article for links and a transcript of our interview.
Click the player below to hear the audio version of the podcast.
Or click the video player below to watch our video on the RV Lifestyle YouTube Channel.
Open camping spots are rare this summer
We just returned from a trip along the Lake Huron shoreline in Michigan in which we tried six different state parks. We knew the weekends would be booked up, as they are almost everywhere.
But we've never had problems before finding spots during the week.
We did this year.
Eventually, we snagged spots in two state parks. But we couldn't put together stays of more than two days and even then we had to charge parks and spots.
But what really frustrated us was, once we were at the parks, we saw lots of empty campsites. Park rangers explained they were because of no shows. When people make reservations for several nights but don't show and don't notify the park and cancel their reservation, the park has to hold on to that site for two entire days…in case the people who made the reservation eventually do show up.
But such camper inconsideration is just one problem
There are other factors at work that are also troublesome: The increasing corporatization of campgrounds and a nasty little computer-driven reservation scheme called “dynamic pricing.”
In our Interview of the week, we talk to Mike Gast, a longtime executive with Kampgrounds of America and now the managing editor of news for RVTravel.com. Mike knows the campground industry inside and out. And he helps us understand what's going on.
After listening to Mike and reading the edited transcript of our interview, I think you'll go Grrr, too.
Interview of the Week: Why can't we fund open camping spots?
Mike Wendland: Let's start talking about what's happening across the country involving big corporations buying up smaller campgrounds.
Mike Gast: Well, it's gotten a lot of attention in the last few weeks. There are a lot of campgrounds in the market right now.
It's been a great time for the mom and pop operations, we'll call them, the smaller campgrounds that have been in operation for several years. The market's really ripe right now for turnover and change.
So anytime that there's money to be made out in that market, you're obviously going to have some turnover.
What's happened is that the prices have gone up. They've jumped like everything else has. All of a sudden, the campground that may have been purchased for a little less than $1 million several years ago is now selling for over $3 million.
The prices for open camping spots are going up
Well, that automatically shaves the market down so that it's a lot more difficult for a small family to get into a campground with 50 or 60 or 70 sites.
But if it's got enough land around it, enough unused land, it becomes very attractive to a group or a corporation that can jump in there with the resources and finance to purchase themselves and have that land to develop.
It's really one of the only ways that we're going to get out of this shortage of RV sites that we're experiencing because you got to have the capital to expand these parks and some of the families that are operating small parks just don't have that much immediate accessible capital to quickly and rapidly expand those campgrounds and get more sites.
Campgrounds need to be expanded
Mike Wendland: So in that sense, it's not necessarily a bad thing for RVers because the only way you say that some of these campgrounds grow is to have that influx of capital, which the mom and pop operators can't come up with. So I guess then in a sense that part's good, right?
Mike Gast: I really am torn about it because the essence of camping is that small, out in the woods, get away from it all small campground are run by, again, a mom and pop, a small family that's making their one living off of that place, and that is nostalgia.
That's the way camping started. I had a long career with KOA, Kampgrounds of America, and the majority of those parks 20 years ago were that small family-owned operation, owned and operated by the folks that were behind the counter.
You hate to lose that by any means, that developed into camping as we know it.
But now camping as we know it is changing.
The amenities that are being demanded, the food services, what the camper expects as far as an experience when they get there with activities and the big, giant resort pools that they like, all that's evolved.
And it's become very attractive and very lucrative for companies to come in there, or groups with resources to come in, purchase these campgrounds, and develop them to what the campers say they want.
Mike Wendland: I read an article in RV Travel that was written by Andy Zipser, who was a campground owner, a well-known guy on the East Coast. He talks about how a campground near him sold for about four million and then a year later, the corporation flipped it at three times that. And I guess there is money to be made by kind of flipping campground.
Mike Gast: Well, and again, the big lure on that specific instance in Andy's neighborhood was the fact that that campground had a lot of unused land around it. It had a great big belt of land that was ripe for development.
And obviously, these corporations come in, these groups come in with revenue and they decide that since it's already a campground, it's a little bit easier to expand to the available land and they have the capital to quickly do that, add more sites and again, add the revenue.
So that's what's happening when the smaller campgrounds get bought up for what seems like a reasonable amount of money.
Dynamic Pricing is being applied to open camping spots
Prices certainly are going up quickly. There's a lot of new money flowing into camping right now and most of that is coming from groups or corporations that have that sort of revenue
Mike Wendland: Now with that comes a different way of doing business. And that takes us to the thing that I think most RVers are going to be particularly concerned about. And this is this thing called dynamic pricing.
First of all, what is dynamic pricing? And then how is that being played out in campground reservations with campground booking fees?
Mike Gast: Dynamic pricing is really nothing new. It's probably been around in some form or fashion for a decade.
Now, if you've ever written an Uber or Lyft car, that's dynamic pricing, they call it surge pricing there. It's a way to automatically control inventory, the supply and demand chain.
So if you've got in the case of Uber, if you've got a lot of demand at say a professional baseball game that's getting out and everybody wants to leave at the same time, Uber does surge pricing.
They'll automatically raise the price, that draws in more drivers increase the inventory of drivers so that the customer can quickly get out now.
So the customer's happy, even though they're paying more to get out. The drivers are happy because they're making more money all of a sudden and they use it as a way of doing that. And again, this is nothing new. Amazon has been doing this to us for probably five or six years now.
Mike Wendland: That would explain why we check the prices of a computer one day and we go back to buy an hour later, but the price is different.
Mike Gast: Another great example is the airline industry. If you actually turned to the guy next to you and asked you what he paid for his seat, it's nine times out of 10 and going to be much different than what you paid for that because the airlines know how often you fly.
They know what type of flier you are. They know whether it's a business or a leisure trip. They know all this about you.
Dynamic pricing maximizes the revenue
That's what's coming into the camping industry. It's a way of maximizing the potential revenue on a campground absolutely for the benefit of the owner.
But again, it's not always a bad thing.
The camping industry used to have fixed prices on sites. The site would be $30 a night way back for the full-service RV site. That was it. Didn't matter whether it was a pull-through, didn't matter whether it was water. It might be a difference between water, electric and full service.
But if it was a full service, full hookup site, it had a single price. We used to print that in the KOA directory as a single price. Didn't matter what day of the week it was. Didn't matter what time of day it was. Didn't matter who you were, what they knew about you.
It's all about the data and the algorithm
Well, now companies and campgrounds that are buying into these reservation systems have all this data at their disposal.
They know how much you've camped with them. They know what size rig you have. They know how many people you camp with. They know where you're from.
So they know all this information so that they can help determine the ability to know what your tolerance for payment is. Again, they match that against their inventory.
It gets very complex in the camping business because there are so many factors involved here. We've got, again, the services part of it. They've got what size rig do you have? Is it a fifth wheel? Is it a pull trailer? Is it pop-up? All these different factors have to get put into these algorithms that drive this type of pricing model.
Mike Wendland: These are the computer reservation systems that are being sold to campgrounds and there's five or six big ones out there and they all use all that data from all that camping probably every time you've booked it's in there.
But here's where I guess I would wonder about it: So my camping is just, say, we come into a site and we tend to stay a night or two at the most, and we cook our own meals and that's about it.
Whereas someone else who would like that same spot, they stay for a week and they eat food and they use all of the facilities and buy all the upsells that many of the campgrounds have.
That reservation system algorithm is then going to give the edge to that person, is it not?
Mike Gast: I think you'd have to be a real victim of timing in order to get taken by that scenario because if you're the first one in to try to book this site, they're not going to hold it back necessarily and wait for for the high roller to come in and book that site.
They're going to take your reservation because it's a sure thing. Now they'll try to maximize the potential off of that. And again, this has been going on for a long time. Campspot, for instance, has been Jellystone Parks.
So they've got a wide base already. So campers have been running into this for quite a while. It's kind of like if you've ever seen a campground owner's reservation grid it kind of looks like a Tetris game where they're moving people from site to site trying to maximize the potential because there's another factor in there how long are you staying that you just brought up.
If you've got one person that's trying to get your best site, your most lucrative site for two nights and another person comes in and they're willing to book it for five nights, that's the more lucrative customer to you.
So again, timing being a factor, you're going to give it to the guy that's going to book it for five nights because then you don't have to worry about it.
Who gets the open camping spots?
But maybe the guy that wanted it for two nights, well, maybe he can have it for the one night that they don't overlap and then he's got to move. So the system will try to offer him another option in order to keep him in the group there. So all of this happens automatically and it happens very quickly. And the pricing model follows along with that.
So campers are going to see a lot of variables put into their pricing model.
If you're trying to get in on the 4th of July, well, this year you're pretty much out of luck. I saw KOA just put out last week that they're expecting 20 million people out there camping this 4th of July weekend, which is an astounding number to me.
It's just a lot of folks out there. Well, you can't find a place on a commercial campground to camp on the 4th of July, but the weekends' filled up. One of the new things that we were seeing now is most of the weekends are full or at least a desirable location.
Open camping spots are harder and harder to find
Mike Gast: We are in a very, very strange time. Again, it's all supply and demand economics.
If the supply is short, like it is right now, the demand goes up. If demand goes up, the price goes up.
And again, I get torn in this conversation because as campers we all want more opportunities to camp. And with the crowds that are into camping now when all these millions are giving this a try, there just aren't any sites out there. If they remain in camping, they've made a huge investment in their equipment now with new RVs.
If they remain in camping, the only answer to that is more sites are needed to expand the current parks, to build new parks, and that all takes time.
So it's going to take a long time to adjust the market of demand or supply to meet demand or better meet demand. And in the meantime, the supply or the demand for that short supply drives that price up. It's just the way economics works. And so for awhile, it is going to be tough.
How long will people put up with not being able to find open camping spots?
Mike Wendland: Well, let me ask you as we wind this down.
I have increasingly come to the conclusion that I think we are about ready to see another change in the market.
I am sensing widespread frustration, anger by RVers, by campers who can't get a place. They're finding it just so much work to really live that lifestyle that they've been sold when they bought that RV that I think we're going to see a whole bunch of used RVs coming in the market soon.
And I wonder what long-term effect this is going to have because the industry seems to have been spending all of their time, this is just my opinion, making money, selling more, selling more, selling more. And now they can't provide more. They're all tapped out.
Mike Wendland: We saw Thor say they were sold out for what? Three years or two years, next year, whatever it is. What effect is all of this? And now the dynamic pricing, do you see it having an effect on the consumer, the RV or the camper out there?
The industry is better connected
Mike Gast: I can tell you that for the first time in my experience in 20 years in this business, I'm seeing a better connection between the big suppliers of camping, the KOA, the leisure systems, and some of those other independents that are out there with the industry.
I think the RV manufacturing industry is starting to listen to some of the people that are actually operating the parks.
You have to remember that a vast majority of the current campgrounds out there were built way back in the '60s and '70s and maybe in the '80s. They'd been around for a long time. They were built in such a way where nobody thought about even a pull-through at the time. And they certainly didn't think about things like slide-outs when they were designing campgrounds. Where were the services put? How much room between the sites?
You get to some of those older parks and again, I'll bring up the game Tetris. When people started pushing those slide-outs out in both directions, some of those sites got really tight.
The campgrounds weren't made for the current market of RV.
Camping has fundamentally changed. Get used to it.
They've evolved over the last 10, 15 years. As sites have gotten bigger as the demand for patio sites has increased, all that has affected the way a campground looks and the way a campground operates. It took some time, but the campground industry flexed to meet what the RV market was doing and what campers were demanding.
I think we're into a period of that now where there's an awful lot of new RVs out there.
There's just a lot of new equipment on the road and campgrounds are going to flex again to meet that. And sometimes it's physically flexing with more sites.
Again, it takes a lot of time to adjust to that. And I think that as we go forward here, the manufacturing side will start listing a little bit closer to the campground supplier side as to how fast things are going, what the options are.
Look for a lot of used RVs coming to the market
You hit a wall, you hit a wall eventually if all these people don't get anywhere near the experience that they were expecting when they buy it, then just as you predicted there will be a lot of RVs on the market
Because if somebody is looking at an RV as an affordable vacation option and all of a sudden they realize they only got to use it two weekends last summer, and yet they paid the insurance and they paid the payment and they paid the storage and whatever maintenance is required, that doesn't become a very affordable option for four or five nights a year.
Mike Wendland: It is. Well, Mike, these are big issues. A lot more complicated than just picking up the phone and saying, “Ah, I can't get a spot this weekend.”
I hope we don't hit that wall. But for the first time in the 10 years now that we've been on the road ourselves, I've never sensed so much frustration from people out there. That's why we like boondocking. We still could find places to boondock, but it's not for everybody.
Even with boondocking it is getting harder to find open camping spots
Mike Gast: Well, no. They're under pressure too. I mean, the Walmarts of the world, they're going to be less and less places to boondock as we know it too because it's just so much pressure. There's so many different kinds of campers out there. I know Chuck Woodbury at RV Travel wrote a column last weekend about kind of talking about what camping is.
What is RVing anymore? Is the homeless person who's living in an RV on a city street, are they a camper? Is the person with a 40 foot RV with heated floors and all the bells and whistles and they never really stepped out of their rig, is that a camper?
Now, how long does this last?
When will it get better? Or will it?
I don't know, a year, a year and a half. I mean, according to the folks at Thor, that's how long it's going to take for them to get back to supply and dealers with an adequate supply.
Well, they're making RVs as fast as they can with the supply chain limitations they've got, but they're still cranking out RVs to people that pre-purchase these things.
It's going to be awhile before you see a lot of RVs flooding back onto lots and things appear normal again. And yeah, that's a lot of rigs out there. Are they going to be in the used market in six months or a year? Probably a high degree of those will be.
Mike Wendland: And how long are people going to put up with this? That's the question.
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