Adapting Your Refund Policy During Challenging Times
Creative Ways for Campground and RV Park Owners to Stem the Tide of Lost Revenue Due to Cancellations
The COVID-19 pandemic has presented campground owners with many challenges, not the least of which is how to stem the tide of lost revenue due to cancellations. Fortunately, there are creative ways to accomplish that goal while still retaining guests’ loyalty.
ARVC addressed this important topic in its Re-Opening Toolkit that was released in May. The toolkit, which can be downloaded for free, was the result of an industry-wide effort between ARVC, Kampgrounds of America (KOA), the Outdoor Recreation Roundtable (ORR), the Canadian RV Association (CRVA), Marshall & Sterling Insurance, state associations and many other industry partners.
The toolkit includes a sample cancellation/refund policy for RV parks and campgrounds that can be used as a template, but it is advisable for parks to have any policy changes they make reviewed by their legal counsel.
One of the best ways to avoid losing critical revenue during periods of increased cancellations is to encourage guests to delay their stay instead of cancelling it and requesting a refund. That’s what Chris Jump, owner of ARVC member-park Anvil Campground in Williamsburg, Va. did.
Anvil’s regular cancellation policy is to refund the guest’s deposit, minus a $10 cancellation fee, if the cancellation is made at least three days prior to arrival. The campground also offers guests the option to have their deposit held to be applied to a future stay to avoid incurring a cancellation fee.
But when the Covid-19 virus began to spread, Anvil was hit with so many cancellation requests that Jump knew he had to develop a new strategy, so he created a program called the Small Business Support Initiative.
“We were just giving so much money back, we felt we needed to have a really big incentive to try to convince people in these dark, uncertain times to let us hold their deposit for a future stay. So, what we did was to offer a 50 percent bonus for their future stay, no questions asked and no restrictions, so their $50 deposit turned into $75. When we implemented that initiative, we immediately saved 80-90 percent of the refunds.”
Jump also offered an incentive for those who still wanted to cancel their reservations—a 20 percent discount on a future stay at any time during 2020. He found this to be an effective way to maintain a connection with these guests and encourage them to return as soon as they can.
He says his Small Business Support Initiative saved his campground thousands of dollars and helped it shore up its cash flow during a critical time.
“We’re no longer doing the program because everything has stabilized,” he says. “We still have a long way to go, but we’re trending up. We’re still being lenient if a cancellation is Covid-19 related, but in general, we’re back to our normal cancellation policy which we feel is extremely fair and beneficial to all parties.”
Jump was featured in the most recent webinar as part of the ARVC Webinar Series. You can hear more about his refund and marketing advice by watching a recording of the webinar, The New GoCampingAmerica.com: Marketing Tips and Tricks, which can be accessed for free by those with an arvc.org account and clicking on the ARVC Webinar Series link to access your online education portal: arvc.org/Online-Education