The Economic Impact of Grow Boating
Market research is playing an ever increasing role in the future direction of industry promotional expenditures. NMMA has been leading the way with research from sources such as Webtrends, Info-Link, Russell Research and Left Brain Marketing.
One very interesting study is being conducted at Michigan State University by Dr. Ed Mahoney at the Center for Recreational Boating Research. Dr. Mahoney has been assembling data to answer a unique question: “What is the lifetime value of one new boater?”
Why do we want to know? For one thing, it can be used to measure the success of our spending and the rate of return on such investments over the long haul. For another, it could help define the optimum limits of such spending. And, presumably, the more research the better the overall decisions.
Working with NMMA’s Carl Blackwell and Jim Petru, Dr. Mahoney took a survey sample of typical boat owners age 55 and up. While the results are not conclusive and only estimates (a more in-depth study will be done) his preliminary findings are fascinating.
Dr. Mahoney determined that this typical boat owner has owned 4.1 boats during their lifetime. They spend approximately $135,000 on those boats. Moreover, the survey showed 40 percent of those boats are purchased new — that figure does not correlate with previous research that showed about 25 percent of all boats purchased annually are new. But, remember, this study is very preliminary.
Here’s where the number crunching gets most interesting. If this early data holds up under more scrutiny, we could conclude this: Applied to the Grow Boating campaign, if Grow Boating brings in just 5,000 new boaters a year that would add an estimated $682 million to boat sales over the lifetime of those boaters. And, that’s a conservative estimate that doesn’t include any accessory sales, dockage, fuel, insurance and similar expenditures. Not bad!
So, the next time you think about what Grow Boating might be doing out there, and whether the investment is worth it, think about what I’m thinking: If we can generate $682 million in lifetime boat sales annually with an investment of about $12 million, our national campaign efforts are clearly on the right track!