A Customer Journey Into the RV Industry: Insights for Improvements
Our New RV Adventure
As newlyweds in early 2020, my husband and I realized, amid the global pandemic, that we could bring more joy to our lives by downsizing into a Recreational Vehicle (“RV”) for full-time living. Unfortunately, we were not the only ones who felt that RV travel was an excellent solution to find enjoyment during the pandemic. Throughout North America, RV dealer sales increased up to 170% year-over-year, and many Americans flocked to seek their private escape on wheels.
We initially started our search with used Class A models based on recommendations from several blogs and other experienced campers. We needed a motorhome that could tow a second vehicle and one that had some comforts of a traditional stick-and-bricks dwelling, such as extra storage, laundry options, and even a fireplace, if possible. We searched a 300-mile radius and found the perfect 2018 Class A within 150 miles. We excitedly reached out to make the purchase, but it sold that day to someone else! After a pint of ice cream, we connected with a local RV dealer who said they could help us find exactly what we needed with a new model, custom-ordered Class A motorhome from a large RV manufacturer. The only catch: we had to wait for the unit to be built, shipped, and delivered (estimated eight to ten weeks). The manufacturer got back to the dealer with an estimate, so we signed the paperwork for a promised delivery date deadline of October 31st, 2020. We contacted the landlord to extend our lease agreement to cover the additional months' rent, given the extra time waiting for delivery of a brand new, customized 2021 Class A motorhome; we eagerly started our downsizing process.
At the end of September, we receive a phone call from the dealer: the manufacturer had to shut down due to COVID outbreaks and supply chain disruptions. As a result, our RV was not expected for delivery until the end of January 2021, roughly 20 weeks, double the quoted lead time. We extended our lease yet another three months, and patiently awaited the arrival of our new house on wheels.
A Dream Gone Awry…
We visited our unit for the first time at the end of January and immediately realized we were in for a tumultuous, problematic journey. The acquisition process had provided us with a brand new motorhome RV, but had the following major differences versus our original order:
Exterior automotive paint color scheme (given black, ordered custom white)
Interior color scheme and finishings (given dark gray, ordered custom off-white)
Generator manufacturer (given Yamaha, expected Onan)
Engine size (given V8, expected V10)
The response?
“It was the manufacturer’s mistake....”
After reaching out to the manufacturer directly, they told us:
“It was the dealer’s mistake....”
So, who is at fault? Does it make a difference? If we wanted to start the process again, they told us it would take approximately eight months for a new, customized RV to ship, which also included, since our original order, five price increases! Since we were already out an additional three months of living expenses, we decided to press on into full-time RV living with the unit given to us and hope for the best.
After refinancing the unit and waiting for the dealer to complete inspection and preparation, we visited for our second demonstration, expecting to drive the RV from the dealer at the end of March. It was during that session that the generator flooded, with us realizing that the auto-leveling power jacks were not working correctly. After two days in the service center, we discovered that the manufacturer had installed the wires on the power jack controls backward, and found the central control panel software was out-of-date, having been last updated in 2018, leaving all auto functions in the coach useless. Having to forfeit another two days of reservation expenses at our campground, we finally drove our new home away from the dealer.
As mentioned previously, nearly everyone we spoke with, RV dealership we visited, and each blog we read, warned interested buyers against buying new units. Within a month of full-time RV ownership, we encountered many defects and issues:
Interior water damage with leaking during rain
Pinholes, rippling, and rips in the vinyl on the driver’s captain chair
Improper shower draining due to improper drain pipe insertion*
Incorrect or missing sunshades and screens in multiple windows
Washer/Dryer combination machine did not work correctly
Front windshield leak in the center during rain
Driver cabin air conditioning did not work
Bathroom door misalignment
Stove igniter on the stove did not work*
Kitchen sink leaks around the seams
Refrigerator door ‘open door’ alarm beeps randomly and intermittently when untouched and closed**
Interference with the fireplace and built-in soundbar remotes (when turning sound down, heat increases and when turning heat up, sound decreases)
Bedroom closet wardrobe bar fell upon first highway trip**
*These items have since been resolved with two additional visits to two separate service centers
**These items have since been resolved by us
We also have encountered several cosmetic defects such as nicks in the wood interior, peeling laminate on paneling, automotive paint overspray on the door handle, and significant construction debris such as loose screws pinned down by other objects with sealant on top. These issues (with a few exceptions*) are still unsolved and it appears that it’s now our, the customer's, responsibility to resolve. Figure A shows our customer experience:
Figure A shows the burden on a customer during the acquisition of a new RV.
The process to find a service center under warranty, schedule a visit (estimated two to three weeks wait time), wait for warranty approval (estimated an additional two weeks wait time), order the parts (estimated two weeks to eight months lead time), schedule the service (estimated two to three weeks wait time), and having the service performed (estimated one to five days) has to be coordinated between the coach manufacturer, the chassis manufacturer, and the independent service center performing the servicing.
Summarized, we have encountered dozens of quality escapes, which we expect to take months of our time and attention to resolve.
There’s Room for Improvement!
There is no arguing that COVID has disrupted many industries’ supply chains. With the increased demand in the RV industry, there are several opportunities for improvement that can alleviate immediate pressure and improve the customer experience for current & future RV adventurers.
In informal surveys our firm conducted over the past two months, almost 100% of the dozens of individuals and RV dealers we spoke with corroborated with our experience, having similar issues found with RVs regardless of model, location, or age. This included trailers, fifth-wheels, Class A, and Class C manufacturers alike.
Interestingly, some are even warning customers to avoid purchasing altogether:
“While RV, motor home/coach sales are soaring across the country, I don’t recommend buying one. It could be the most costly mistake a family or a business could make.”
As demand for new RVs continues to soar, the manufacturers and industry have a decision to make:
What will they do to mitigate the safety & quality issues, and meet challenging delivery goals?
Customers want their own home on wheels; instead of resolving the laundry list of problems with a new purchase, some are turning to make or convert their own. DIY RV solutions and their impact on the prominent manufacturers and industry is yet to be determined, but frustration and social media are helping influence new buyers’ decisions.
Where Do We Go From Here?
As with many systemic issues, the best way to understand and resolve these challenges can be done considering the customer’s journey: how does one decide, finance, and acquire their home on wheels without costly aftermarket service impact? North American Original Equipment Manufacturers (“OEMs”) and dealerships should consider the following three recommendations to improve safety & quality, reduce costs, and, thereby, improve customer satisfaction:
OEM Accountability
The current RV industry model is similar to other transportation industries like automotive: manufacturers ship and sell units to dealers, where customers purchase units from dealers. Automotive consumers are insulated from many potential quality issues due to the regulatory bodies and market demand which drive standards for production and service. This accountability between automobile OEMs, dealers, and customers provide positive pressures to ensure high-quality products with minimal cost.
As we experienced with COVID in 2020, the RV industry is susceptible to significant disruption if investments are not made to improve the process. OEM manufacturers need to “own” the safety & quality of their products, including mistakes, and take accountability for the costly quality issues which are passed along to customers. Ideally, this should be prevented from escaping to the customer in the first place, thus reducing the impact on overall warranty and service costs. There are several methods and techniques which can be applied during the production of an RV which would both improve quality and reduce lead time for delivery.
In my experience, the RV dealer we worked with has adopted a process that extended the delivery time to the customer by several weeks due to internal policies created to inspect (and rip apart) the units upon arrival. Why must a dealer inspect a brand new RV on arrival? Unfortunately, without this extra step customers are subject to even higher rates of quality defects and failures to which the dealer would be liable to service. Dealers are forced to spend extra time and money upfront to get reimbursed from the OEM eventually for any issues, another headache as well. The OEMs should hold themselves accountable for their quality issues. Ultimately, the reduction of escapes would improve the customer experience, and reduce costs throughout the supply chain.
Improve Customer Service
This advice may sound like a “no-brainer”, but it bears repeating. The OEM warranty process has many potential improvements to support customers after delivery of a new RV.
Figure B shows the variability and extensive cost of warranty service in the RV industry as of today.
Figure B shows that the estimated time expected for aftermarket service solutions can range anywhere from nine weeks to 44 weeks. Given most OEM warranties offer coverage of up to one year from purchase, a customer can spend over three-quarters of a year waiting for servicing. Considering the increased volume of units shipping recently with safety & quality issues, and the increased demand on service centers from the used and DIY market, the OEM warranty process is costly, inefficient, and its flooding the aftermarket with unnecessary work, which customers ultimately have to pay for in their time and location expenses. While this may not affect casual RV owners much, it has a significant impact on the increased number of people who claim RV full-time living. Therefore, reducing the burden on the aftermarket will immediately alleviate the effect on the customer experience, and save OEMs a considerable amount of time and money.
3. Transparency
As with many processes, visibility is key to understanding whether that process works as intended and achieves value for your customer. Therefore, it is essential to gather feedback and insights from all parties involved with a value stream to effectively map out where in the process you may encounter bottlenecks or constraints.
During our RV acquisition, we felt “in the dark” nearly every step. It was our responsibility as the customer to proactively call generic numbers, wait on hold (in some cases for hours), and navigate the numerous people and parties involved across the dealer (sales, administration, service management, service technicians, management, etc.), OEM (warranty management, warranty service, service technicians), and financing (sales representatives, underwriters, loan officers, service managers, etc.). Altogether, we coordinated with sixteen people to find the information we were seeking until the delivery of the RV. It took seven months from the order date to receiving our RV keys, versus the commitment from both OEM and dealer that it would take approximately two months.
Overpromising and under-delivering is the most frustrating position for your customer. It can understood that, sometimes, circumstances change, especially during the 2020 pandemic disruption. However, visibility to the entire process, and monitoring & sharing information could reduce, or even eliminate, customer dissatisfaction. Creating visibility and transparency with the steps required for a customer to complete a process can be done through various digital solutions. Ultimately, with coordination and mapping across the value stream, key stakeholders can identify opportunities for improvement, leading to significant cost reductions and shorter lead times.
A Roadmap for Greater Success
Interest in RV ownership is continuing to rise and doesn’t appear to be slowing down any time soon.
According to Business Wire in March:
“The North America Recreational Vehicle market was valued at USD 26.7 billion in 2020 and is anticipated to reach USD 35.7 billion by 2026, at a CAGR of about 5% during the forecast period (2021 - 2026).”
The industry has a valuable opportunity to improve the reputation and operations of OEMs, dealerships, and service centers.
Here are some steps to execute today to achieve increased profitability and long term growth across the industry:
Evaluate & map out business processes to identify the status of your current state
Identify key stakeholders and information required from the customer’s perspective to expedite the ownership acquisition process
Improve manufacturing safety & quality, and “lean out” operations to eliminate escapes from reaching the dealership
Eliminate any gaps in communication
Develop process differentiation for customer types (recreational buyers versus full-time living buyers)
Digitize information in a solution which potential or existing customers can access
The opportunity to improve the RV industry is now! Actions with minimal investment can, and should, be executed to make a massive impact on millions of North American RV owners and users. We look forward to the day to speak with a fellow RV adventurer who received a new RV without any quality issues or delivery delays. With your help and willingness to improve, we can make it so.
In the meantime, I will be anxiously waiting for the service center to call me back….
