Boating Industry

January 2016

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MARKET FOCUS SECTION { BOAT CLUBS } January 2016 | Boating Industry | 37 "When you have a lot of new, burgeoning companies in a new marketplace, consoli- dation is a very natural direction … and we knew that it would be a fast way for us to accelerate and grow." The merger allowed Boatsetter to increase its fleet and on-water services. The company offers a new and improved revenue share model for its users with a 70-30 revenue split in the favor of the boat owner. Owners also have better capabilities to vet captains and match them with their boats. "When [renters] go to pick a boat, [they] can actually look and pick between three to five captains that the owner has approved for that boat, and [they] can read the other reviews people have written about them or what experience they're looking to offer," said Baumgarten. Boatbound also entered into a new part- nership this year with SailTime. Unsold frac- tions at SailTime franchises can now be listed on Boatbound, which last until the fraction sells or can be a permanent rental fraction for the location. "We think that boat [club] models are re- ally good for the industry as a whole, as it's getting people that first experience into boat- ing," said Oetting. "Ultimately, we're trying to solve the common challenges of the industry, [which] are certainly based around affordabil- ity and accessibility. We view that, working together, we can more aptly come together to solve that problem." Freedom Boat Club entered into a dif- ferent kind of partnership this year. Bobby Parker is a Freedom Boat Club franchise owner and happens to be the nephew of David Parker of Parker Business Planning. Bobby approached the company and sug- gested looking into hosting a 20 group meet- ing for its franchisees, and after months of discussions regarding the benefits, Giglio de- cided it made sense to participate. "[Boating] is a very unique industry," said Giglio. "It's not like your traditional franchise of a Subway or McDonald's where you're get- ting the same hamburger in Spain as you are in Texas. Any way that we can continue to bring that consistent membership experience … we saw the 20 group as a great opportunity to do that and really focus on how to become a successful franchise." While 20 groups are standard to most in- dustry professionals, they are an entirely new concept for a boat club. However, after at- tending the 2014 Top 100 gala and realizing 11 of the 13 top dealers were Parker 20 Group members, Giglio said it was an easy decision to move forward with Parker. "Even though we're a 26-year-old busi- ness and we know a lot about running boat clubs, I think there's a lot we're going to be able to ascertain from David, his experience and the experience of some of these other people in the marine industry by running the 20 group," said Giglio. "When we can look at our financials on an individual basis and compare them as a group, it really gives a lot of guidance on how to more efficiently run the business, and that was what the takeaway for many of these guys were." As Freedom Boat Club continues to look at the industry in the long term, it has also begun to embrace the work the Recreational Boat- ing and Fishing Foundation has done to en- gage the Hispanic market, and Freedom Boat Club is following that example. The company brought in Maurice Amaya to strictly focus on multicultural market development. Freedom Boat Club is working on betas right now in the Naples and Tampa Bay markets. Giglio said boat clubs offer these Hispanic customer and opportunity to learn how to boat, what options are available and create new purchasers down the road. "We're pretty excited about that," said Gi- glio. "With the changing demographics … these are up-and-coming middle- to upper- class families that don't historically have a boating background, and we feel like the boat club concept fits perfectly into what's going to attract this group of people into boating." GOOD CITIZENS The perception that boat clubs and boat sharing models are stealing customers has slowly begun to dissipate, particularly as these businesses continue to actively position themselves as an aid to getting more boaters on the water. Giglio has worked for the past four years on clarifying misconceptions around the boat club model and whether or not it competes with customers, and he has seen the reputation of boat clubs generally improving. Freedom Boat Club aims to be a good citizen by find- ing new opportunities for collaboration with industry stakeholders. "Boat dealers, marinas and manufacturers out there, we're all in essence selling the same thing, and that's time on the water," said Giglio. Freedom Boat Club has engaged in several new partnerships in the past year with orga- nizations such as Power Squadron Training; Ladies, Let's Go Fishing; Discover Boating; the National Marine Manufacturers Associa- tion and more. "There are resources we have as a fully functioning, operating boat club with 950 boats in the water around the country that we're anxious to partner with [industry] groups to be able to let them help get people on the water," said Giglio, "and the more peo- ple on the water, the better it is for everybody." In order for everyone in the industry to be able to unite, Giglio says everyone needs to focus less on their business's roles in the indus- try on a micro level. "I think that everybody in the industry needs to be thinking more on a macro level, which is not about the boat I sell today or the boat I rent today or the boat club member- ship I sell today; it should be a focus on what are we doing today to grow the industry tomorrow," said Giglio. "It's the collabora- tion of all of these groups to try to figure out the quickest, most efficient way to get more people on the water, which will help the industry long term." WITH THE BOATSETTER/CRUZIN MERGER, CUSTOMERS NOW RECEIVE BETTER REVENUE SPLITS.

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