In the past you have heard me pontificate about the trust of the consumer and more specifically how it relates to setting rates at park level. To be more precise, over the years there has been some pressure to move toward yield optimization of parks automatically. In other words, the rates go up in your park every time you sell a site. The rates are adjusted by your software program based on an algorithm that you configure in your system.

My argument has always been that the outdoor hospitality business is different than the airlines or hotel business. That there is a certain social interaction you see around the campfires that you do not see in other industries. If you charge one person one rate and the next per a higher rate you end up breaking the trust of the consumer. It will cost you a lot more than the extra $10 per night you might have gotten, to get that customer back. Recently I had an experience to illustrate this fact.

My older brother just turned 50 years old. To celebrate the entire Kearns clan went to Vegas. Twenty of us. Now Steve is a new year’s baby so we went down over this past New Year’s. It was fun but I always had this underlying feel of distrust that I was being overcharged because it was New year’s. Turns out I was. Now Vegas are the absolute masters of supply and demand. My hat is off to them and they make no bones about it. They are there to deliver a customer experience and extract the most amount of money possible from your pocket. But at what cost?

For example, we stayed at the Mandalay Bay Casino. Very Very nice. Our room were $278 US per night. Got home on the Friday night. The following Sunday I had an email from their marketing department offering me the same room for $77 per night. I understand supply and demand. I get it. However I had just a bad taste in my mouth and a lingering odor of rip off when you receive that kind of treatment. Beer was $9, Cocktails $14. Corn beef sandwich $19. When I asked the waiter, was this the regular pricing he said no , it’s new year’s eve! Get over it!

I got in a cab to somewhere in Vegas and I chatted with the cab driver.  He tells me it is out of control. He says the hotels built too big too fast. He showed me the new 9 billion $$ CityCenter project that sits idle. He tells me the Consumer Electronic Show (CES) is moving because the costs are too high. That is the hidden cost of breaking the trust of the customer and relying solely on supply and demand. Once you take the human eyeball element out of it you risk the wrath of your customers.

I had a good time in Vegas however I will not go back on New year’s. Not because I can’t afford it, because I don’t like to be taken for a ride. Let’s not go that route in our industry.

That is it for now. Hope that invokes some discussion.

Peter

As is my daily routine, this morning I was up early riding the recumbent bike. I was getting my exercise and watching the doom and gloom news. I try not to watch the news as I feel like any other industry they need to sell product and they can’t do it with good news. However with all the turmoil on Wall Street I felt it was best to check it out in between sports highlights. So after seeing the details of the market slump and figuring out that I now have to work till I am 93 years old, I decided to channel surf as all males do. And what do I come across? The movie Wall Street at 6 am in the morning. What a brilliant piece of TV scheduling!

That got me thinking about Michael Milken and his x-shaped desk. I was also pondering the Gordon Gecko “greed is good” speech in light of the market turmoil. These last two days have been this generation’s Ivan Boesky and Michael Milken stock market upheaval. (Reminds me of how old I am).

I am wondering how this upheaval will affect the campground business or even the normal man on the street. Is this problem mainly confined to the guys on Wall Street? Indeed the economy is still in a period of growth albeit at glacial speed. The harried family man is more concerned about the price of gasoline then he his is about the financial ABCP default derivatives market. I am sure there will be some fallout at street level and the Chapter 11 lawyers will be able to buy another house to add to the 3 they already have, but for the life of me I cannot see it really impacting our business to a great degree in the rv and campground business.

Peter Drucker said one time , “Business is about building things and selling them”. Fairly simple and straight ahead. So my question is why didn’t these  brilliant minds at that top of these firms take step back and do that? Instead of creating a bunch of hopelessly complex financial instruments that brokers pushed out to the street without any idea of how they worked or the risk involved. As my buddy Harry says,” I am beginning to think that Wall Street is the only sector affected, by the mess they created for themselves.  Somebody at the top needs to get these huge financial institutions back to the basics (i.e for banks lending money to individuals and businesses, and for insurance companies to insure ordinary course stuff).”

People still need to take holidays. What better way to get back to the basics then go camping?Those are my thoughts for today. Your comments are welcome.

Today’s topic is PCI Compliance and how it applies to a RV Park and/or campground .  From wikipedia, “PCI DSS stands for Payment Card Industry Data Security Standard.It was developed by the major credit card companies as a guideline to help organizations that process card payments prevent credit card fraud, cracking and various other security vulnerabilities and threats. A company processing, storing, or transmitting payment card data must be PCI DSS compliant or risk losing their ability to process credit card payments and being audited and/or fined [1]. Merchants and payment card service providers must validate their compliance periodically. This validation gets conducted by auditors – i.e. persons who are the PCI DSS Qualified Security Assessors (QSAs). Although individuals receive QSA status reports on compliance can only be signed off by an individual QSA on behalf of a PCI council approved consultancy. Smaller companies, processing fewer than about 80,000 transactions a year, are allowed to perform a self-assessment questionnaire.”

We have recently gone through a compliance process for our Bookyoursite.com online booking system.

We hired an outside independent firm called Securris (www.securris.com) to conduct this on our behalf. Great company and very professional. After a security scan Securris gave us a list of changes to the system we had to make in order for them to give us their stamp of approval as being PCI Compliant. Pretty eye opening and fortunately for us we did not have to make too many changes. The process is not cheap. At any rate we are getting a few questions from our customer base as to whether or not we are PCI compliant or not. We are in the process of getting Campground Manager Software® certified and Bookyoursite.com will be certified in the next couple of weeks. However that does not mean that you are certified. Basically we have said ” we’ve done our part” to make sure you are complaint. Now you the owner/operator have to do your part.

PCI Compliancy involves the entire system, from software to the hardware set up at park level to Internet access on your network. It encompasses all facets of the information processing package and the financial transaction package. Firewalls, encryption, access controls are all taken into account. I started thinking about that and how it applies to the local computers at park level of some of our smaller accounts. Identity theft and cc fraud is a real problem. The credit card companies had to address it. I am thinking of it in terms of the credit card companies creating a new industry that has to go around and provide compliancy tests for each business location. Is that right? Is it affordable for our customer base? For the most part I would say no it is beyond their scope. So hopefully they will fall under the 80,000 transaction mark and can do the self assessment. I also started thinking about it in terms of us expanding our SAAS model (Software as a Service). I really believe that with the security controls that will have to be in place in the near future in order to take credit cards, especially online, we will be putting more and more parks on our server and then running  from there. All a park will need is a computer with a high speed internet connection to run the system. We handle all the security and upgrades and backups. Our servers are behind the appropriate firewall and encrypted security features. We store them at a top of the line colocation facility.

For anyone who decides to go on our SAAS product we will meet the PCI compliance test for that portion of the IT package. This will go a long way towards helping the parks become compliant and letting them keep their ability to process credit cards. Your comments are welcome.

Peter