Only about two in 100 people who are researching their first boat will actually buy one, and only one of the two keep it.
After 10 years, 54 percent of first-time boat buyers have dropped out, says Carl Blackwell, senior vice president and chief marketing officer of Grow Boating. When those new buyers go on to purchase a second boat, that rate is 38 percent.
“The percentage of people who fall out of the purchase cycle is alarming,” Blackwell says. “The fact that we’re losing first-time boat owners in those first five years, once we do all that work getting them into a boat, is discouraging when there are all these opportunities to keep them. Because once you get them in that second boat, they’re more likely to buy a third boat.”
Grow Boating conducted a study with marketing consultant Olson after learning that there are a million fewer first-time buyers today than a decade ago — a 30 percent decline in first-time used-boat buyers and a 54 percent drop in first-time new-boat buyers. Now the group is trying to figure out why so many leave the sport. “I think a lot of it boils down to a lot of things that are out of our control, like time and money,” Blackwell says. “But there are other things that are in our control.”
The average first-time boat buyer is 45 years old, 10 years younger than the average boat owner, says Jack Ellis, founder and managing director of Miami-based Info-Link.
Most leave boating for similar reasons, says National Marine Manufacturers Association president Thom Dammrich. “What they talked about was the cost and effort of maintenance and storage,” Dammrich says. “If we could include the first year or two of maintenance in the price, that would help because if someone’s been boating two or three years, you’ve probably got them hooked.”
Why they might be leaving
There is no data about attrition beyond the Grow Boating study, which interviewed only 20 first-time buyers. But Eric Smith, operations manager of Colorado Boat Center, thinks lack of experience plays a role. “Boating sounds good in theory,” Smith says. “The pictures look great, but once you get the boat home and go, ‘Oh crap, I’ve got to back it down the ramp,’ if you haven’t done it before, it becomes very, very intimidating.”
Lack of transparency also leads to problems, says online sales guru Marcus Sheridan. “Whenever somebody is going to buy something, they want to understand the good, the bad and the ugly,” Sheridan says. “The problem is that oftentimes many boat sellers want to paint the good and gloss over the bad and the ugly.”
Access can also dampen people’s enthusiasm for boat ownership, says Chris Edmonston of BoatUS. Workforce shortages make it difficult to service boats quickly, and attrition becomes inevitable in markets with shorter seasons. “It’s kind of a perfect storm of things happening with people,” Edmonston says. “It can be hard financially to afford a boat, and if you can’t keep it close to you, that makes it harder to use. If you don’t know what you’re doing, it limits the time out on the water to perfect conditions, and if something goes wrong, it’s really hard to get it fixed. That is a guaranteed deal breaker for me wanting to keep a boat.”
Knowing the ropes
A quick tutorial isn’t enough to give new boaters the information they need, Sheridan says. “When I bought my current fishing boat, the guy spent 20 minutes showing me stuff, and that was it,” he says. “I have a sink in the cabin of my boat, and to this day, after four years, I’ve never turned the sink on because I’ve literally never been able to figure out how to do it. The person I bought it from is two hours away, and the manual didn’t explain it, meaning the manufacturer also failed to explain it.”
Providing on-water training is also critical for safety and confidence. If a boat owner is afraid to leave the dock, “then you’re going to lose them,” Blackwell says. “You really want to get consumers out enjoying their boats. So providing hands-on skills training, like helping people maneuver in close quarters, is critical.”
Discover Boating, the consumer-facing arm of Grow Boating, offers training at boat shows. Mount Dora Boating Center & Marina in Florida has a program that gets people at the helm to teach basic handling skills. It fosters an initial desire to purchase a boat and connects first-time buyers with retailers, according to owner Joe Lewis. “It allows you to actually create a conduit between boat buyers and retailers,” he says.
The BoatUS Foundation conducts three-hour courses for $159 to teach people how to prepare a boat for departure, steer straight at idle and dock alongside a pier. Edmonston sees students who come from more than two hours away. “I ask them why they came so far, and they will often say, ‘I wanted to make sure nobody in my yacht club knew I needed this training,’ ” Edmonston says. “It’s the realization that they got in way over their heads and don’t know what to do about it.”
Online training is a good initial tool, but it doesn’t factor in such aspects as wind, current, tides and the fact that boats can be approaching from 360 degrees, Edmonston says.
Colorado Boat Center offers orientations and holds monthly on-water training in half-day sessions that are free to customers and $25 for everyone else. “There’s no real licensing board through states, so it’s kind of up to us to make it safe for them,” Smith says.
Much of the marine industry has been transactional rather than experiential, something that Matt Gruhn, president of the Marine Retailers Association of the Americas, sees as a missed opportunity. “We build a boat and want to sell that to a dealer,” Gruhn says. “We inventory a boat and want to sell it and move on to the next one. [But] people don’t buy a boat to own a boat. They buy the boat to go fishing. They buy the boat so they can take their kids out wakesurfing. They buy a boat to do a sunset cruise with their friends and family. That’s what they’re buying. If we can do a better job in engaging in that experience and why they’re buying a product, we’ll have a better opportunity to get them to buy the next boat, and a better opportunity to keep them in boating forever.”
For instance, if a boater wants to fish, a dealer should ask questions about the fish he’s targeting and provide helpful information, Gruhn says. “Think about if every dealer had a director of customer experience,” he says. “Let the salesperson move on to the next transaction, but connect the customer to your director of customer experience. After I bought my boat, I never heard from my dealer again. Not once. You look at that from an industry perspective and wonder how many people is that happening to.”
There’s a difference between selling a boat and creating a lifelong customer, says Lewis, who also serves as MRAA chair. “Both are equally important,” he says. “Sometimes you’ve got to create the customer before you can sell the boat.”
Mount Dora stages regular events to engage with customers outside of the dealership. “It gives people an excuse to use their boats, number one, and it gives us a reason to talk about using their boat,” Lewis says. “It gives us a reason to talk to them outside of the sales realm.”
They ask, you answer
Sheridan believes lack of transparency costs boat sales and contributes to attrition. “The best way in life to handle concerns is to address them before they become concerns,” he says. “Dealers have a choice. They can handle it at the outset or after people buy a boat and it leaves a bad taste in their mouth. You can’t always handle every concern, but you can be honest with them. They are going to learn from somebody, so it’s always our choice whether they learn from us.”
Some dealers provide transparent pricing and allow customers to build their boats online. But even that doesn’t go far enough for Sheridan, who says he struggles with his online experience. “I don’t understand a third of what the options do or what they mean,” he says. “We have this terrible problem where we think that everybody knows what we’re talking about.”
Today’s buyers want to see videos, read articles and see explanations next to every feature. “They will say what it does sometimes, but they almost never say who it’s not a good fit for,” Sheridan says.
Being transparent doesn’t always come at a price, Blackwell says. If dealers can’t offer free storage or maintenance during the first year, then they can educate the customer about options. “If customers are prepared a little bit better, these are not surprises, and they know how to handle it,” he says. “That’s something we’re going to try to address with Discover Boating. They could say there are too many variables to tell customers what these things are going to cost, but if you tell them what they need to understand, they’re going in with their eyes wide open.”
Grow Boating’s research showed that a large percentage of potential buyers left because they didn’t have a helpful experience at the dealership, Lewis says. “That’s why transparency and 100 percent honesty have to be the main things, even if it costs you the sale today,” he says. “Because what you gain by doing that is trust, and when they trust you, they will come back to you when they are ready to make that purchase.”
Show, don’t tell
People have grown sophisticated in online research. Sheridan suggests a website that asks a series of questions to walk prospects through the process of finding the perfect boat, instead of showing a lineup of models. Questions like, “Do you plan on dry-storing or keeping your boat in the water at a marina?” will help shoppers self-select the right boat.
Dealers should also address questions that new boaters don’t know they have, like how long preparation and launching the boat takes, how far the ramp is from their home and how much fuel the boat burns. Prospective buyers should also know how much the gear for a particular activity will cost, and whether the activity is conducive to the body of water the customer wants to put the boat on. “There’s a billion of these questions, and unfortunately, the only people we can ask is our friends,” Sheridan says.
That’s where video enters the equation. Instead of showing boats running, videos can provide specific information, such as the difference between standard and upgraded electronics. “The average videographer costs a good bit less than the average salesperson,” Sheridan says. “It’s not that 90 percent of them don’t have money for a videographer; it’s that they haven’t shifted budget yet. Seventy percent of the decision is made by the time people walk into the showroom.”
One reason people are having a difficult time at dealerships is because so little time is spent there. Companies can include video bios of the sales team on their websites to form a connection with shoppers. That will make them feel less intimidated when they have questions post-purchase.
“The reality is, we’re all in the business of trust,” Sheridan says. “If we want to have a lifetime business, something that truly lasts for decades, you can’t build a business off of one-off customers.”
Filling the sales funnel
It’s not just boating that is losing its newest participants. Several recreational industries see a high rate of attrition, Ellis says. “I think people probably start off gung-ho, and life gets in the way, and then they think, Why am I paying for this piece of fiberglass in my driveway?” Ellis says. “Maybe it’s just the nature of the beast, and you’re going to have a higher defection rate among first-time boat buyers. Perhaps it’s always been like that. We talk about the funnel. It may just be we need to fill the funnel up more than we think because if we’re going to lose half of them, we need twice as many as we thought.”
Bryan Seti, general manager for sales and marketing at Yamaha Watercraft, says his company draws more people into the funnel by offering entry-level boats. Half of the company’s PWC buyers are first-timers, as are 30 percent of its runabout customers.
Lewis added pontoon rentals to his dealership. People who rent a boat might not have a situation conducive to ownership today, but that can change.
The sharing economy could draw more to the recreation, both indirectly and directly, says John Giglio, president and CEO of Freedom Boat Club. While Giglio says he typically has a different customer than a boat buyer, about 20 percent of the people who leave the club each year do so because they’re buying a boat. “We’ve had instances of dealers getting upset because someone he was dealing with joined the club instead,” Giglio says. “If a person was looking at buying a boat, he’s probably going to have a boat either way, but he wasn’t ready. And when he is, now he’s going to make an informed decision.”
Four of Hurricane’s top dealers are in four of Giglio’s largest markets. “I have 200 Hurricanes on the west coast of Florida,” he says. “So it doesn’t hurt their business, and arguably, it fuels sales because every time people see a boat go by, it’s usually a Hurricane.”
Are they really leaving?
Seti says he doesn’t worry much about the retention numbers. “If you commit to owning a boat for seven years, six years, that’s a pretty big commitment. Our lifestyles change a lot in six or seven years,” he says. “With 140 million participants, you’re going to have people who turn over all the time.”
The data Info-Link tracked with Grow Boating went back 10 years, but Seti and Lewis both think those cycles might run longer. A first-time boat buyer might be flagged as such twice if she kept her boat for seven or eight years, sold it when her life changed and bought another one five years later.
“I think we’re in a better place than a lot of people lead us to believe,” Seti says. “Certainly at Yamaha, we’re that gateway that gets the first-time buyer in boating. We are seeing some tremendous numbers in first-time buyers. That’s what we do, that’s who we go after. I think if we’re doing it and it’s happening for us, that’s a good sign for the industry.” n
This article originally appeared in the August 2018 issue.