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Outdoor hospitality: evolution, revolution

The outdoor hospitality industry has undergone major changes over the past ten years. First of all, the 2012 ranking led to a standardization of the offer. This standardization of the product range has gone hand in hand with consolidation, leading to the gradual disappearance of small independent brands in favor of large franchise groups that are moving upscale. This move upmarket has manifested itself in the sophistication of the product to meet the new needs of today's customers.

Outdoor hospitality refers to a form of accommodation provided either on an empty site, where it is possible to place a vehicle or light accommodations such as a tent, or in a mobile or immobile structure corresponding to accommodation solutions specific to outdoor hospitality (lodge, tee-pee). 

There are three categories within the outdoor hospitality sector. There is the campground proper, as declared, whether it is inhabited or developed. The second category relates to land that is subject to urban planning standards, namely campsites and residential leisure parks offering lodging solutions related to outdoor accommodations. Finally, natural areas are available for camping, as defined in Decree No. 2014-139 of February 17, 2014.

As for campgrounds, there are two categories. On the one hand, there are municipal campsites, with a maximum size of 6 pitches, and on the other hand, there are private campsites, whose category is issued by Atout-France, which defines the list of star-categorized establishments. The transformation of a vacant lot into a campsite (whether municipal or private) is subject to a set of urban planning rules. The land must also correspond to the land use plan and the PLU (local urban planning plan). 

New classification since 2012 (decree of 12/23/2009)

Since 2012 a new classification of tourist hotels has replaced the old one dating back to 1986. This ranking affected all accommodation categories, including outdoor hotels. The decree of December 23, 2009, made mandatory on July 23, 2012, repealed the decree of February 14, 1986. The latter set the standards for the former classification. The standards have been redesigned to meet expectations in terms of safety and comfort at the beginning of the 21st century, and are defined in Decree No. 2009-1652.

The sector's operators had to reapply for classification until July 2012 in order to remain on the official list of tourist accommodation. For the outdoor hotel industry, this reclassification would have been successfully carried out, since 86% of the structures requested to keep the title of campsites. However, several small players such as municipal campgrounds were not able to keep up with this change, mainly because of the new cost of accreditation. Indeed, previously free and permanent, since 2012 it must be applied for from a body accredited by COFRAC, for an average sum of EUR 5,000 per year, i.e. a total of EUR 20,000 for 4-year accreditation (to be renewed at the end of this period). This sum, too expensive for small structures, discouraged them from doing so. They have therefore been downgraded, and no longer appear on the list of the new system.

In addition to this downgrade, the decree of 23/12/2009 had other consequences. First, the switch from 4 to 5 stars has resulted in an artificial upgrade of the offer, which is considered inadequate by some customers. Moreover, the old ranking had a purely administrative logic with a limited number of criteria, that had nothing to do with customer satisfaction. The situation has been completely reversed with the new decree, which is based on a much more normative logic, with a clear objective of harmonizing the classification systems of all hosting modes to offer customers a more comprehensible approach. Finally, this evolution also made it possible to kill two birds with one stone, by reinforcing the attractiveness of the offer on a local as well as a global scale, through products that have integrated the expectations of the world market and that can thus compete in the international arena. This is all the more possible with the opening of the Atout France platform, namely www.france.fr, to campsites since June this year, thanks to a partnership between the Fédération Nationale de l'Hôtellerie de Plein Air (FNHPA) and Atout France.

More practically, the procedure was carried out in two stages. The first consisting of a pre-diagnosis, in order to check whether all the eligibility criteria have been met. This is then followed by an inspection visit by a private body accredited by the French Accreditation Committee (COFRAC). For 4 and 5 star accommodations, there is an additional step, namely a mystery visit. Once accreditation has been validated and given, the institution must carry out an annual audit as a follow-up measure, carried out by auditors mandated by COFRAC.

Established in 1994, COFRAC is a national body with associative status (1901 law) whose function it is to provide accreditation to bodies that assess the conformity of companies, regardless of their sector (tourism, biology, health, etc.), on French territory.

Outdoor hospitality: leading form of accommodation in France

The outdoor hospitality sector constitutes the largest accommodation supply in France. It represents more than half of the supply (59%) of the national metropolitan territory. There are 8,297 campgrounds or 906,883 pitches in 2019, compared to 642,779 tourist hotel rooms (source: INSEE).

 

The national distribution of sites is quite clear. Campgrounds are largely concentrated along the coasts, particularly on the Côte d'Azur, the Atlantic coast (from Brittany to the Pyrenees) and the Hauts de France. Some of the facilities are scattered in the hinterland, such as along the Rhône Valley (Drôme, Ardèche, Gard), and in the Dordogne, in the New Aquitaine region. The supply is very limited around urban centres and in the rest of the country.

 

Carte des emplacements en France
Number of pitches in France. Source: INSEE in partnership with the Direction Générale des Entreprises (DGE) and territorial partners.

Breakdown of the supply by range 

As with traditional hotels, 2 and 3-star establishments predominate the outdoor hospitality sector in France, which accounts for half of the supply (51%). Then come the top-of-the-range campsites (4 and 5 stars) which represent about one third of the market (37%), followed by the 1-star or even unrated campsites which account for 12% of the total. This product is gradually moving up in range.

 

Was the change in the supply upset by the reform in hospitality in 2009?

The outdoor hotel sector has been characterized by a highly fluctuating supply over the last decade. A constantly restructuring fleet disrupted the supply of pitches between 2010 and 2017. The number of sites varies between 850 K and 925 K over this period, peaking at 925,005 sites in 2015, and dropping to 918,816 sites two years later. The year 2013 was marked by a sharp decline in the customer base (-2.78%), the strongest during the period. The following year started off well (+2.06%). But 2016 and 2017 have an almost stagnant fleet, with a slight decline by -0.26% and -0.41% respectively.

The hospitality reform applied and made obligatory in 2012 had a considerable impact on outdoor hospitality. the latter lost no fewer than 30,000 pitches in 2013, due to the downgrading of structures that did not request reclassification in the new system, particularly due to the cost involved in doing so. Classification was free, previously. Now that the listing is paid, municipal and small campgrounds can't justify it.

 

A concentrated sector 

This sector is quite concentrated with the four biggest corporations, Leading Campings of Europe (17%), Yelloh! Village (17%), Vacanceselect (13%) and Flower Campings (10%) owning more than half (57%) of the supply of pitches on the market. The other actors, such as Siblu, Sunêlia and Huttopia, only own a very small shares of the supply (<10%), and together they account for less than half of all pitches available.

The shrinking of the supply has multiple consequences. First of all, it results in a quasi-monopoly by the three major groups, Campings of Europe, Yelloh! Village and Flower Campings. Competition is thus unbalanced since these actors have a higher economic weight than the others.

Then, this situation gives them a significant competitive advantage, because they have greater visibility. They are thus behind innovation in the sector, and inaugurate new trends. Jean-Guy Amat, president of the Comité exécutif national des chaînes et des groupes de campings, and manager of a property in the Hérault, confirms this situation, with the risk of risks of abuse that could arise in the future:

More and more campsites are being bought by groups or are joining chains. Today, 50% of the activity is carried out by the 1,075 campsites belonging to groups or independent campsites under franchise, i.e. 13% of French campsites, 27% of pitches, and €1.3 billion in turnover..... The first consequence of this phenomenon of concentration is that campsites have become goods that are negotiated for large financial groups that want to develop. The second point is that this makes it possible to have a more segmented and readable offer, thanks to massive communications implemented by these groups. But the big concern is that groups are adopting more aggressive marketing methods, with sometimes extremely low pricing, which can cause independent campsites to falter when they are unable to compete. To be sustainable, they must differentiate themselves through added value, for example atypical accommodation, and be supported by the public authorities.

 

An economic model in favor the most innovative 

Consequently, outdoor hospitality is a sector where competition happens through horizontal differentiation, meaning difference based on the originality and diversity of the supply. Innovation is a veritable economic and marketing challenge to gain market shares, as explained earlier.

Yet, innovation appears essentially in upscale campgrounds, where the diversification and sophistication of the supply are essential, distinctive factors in attracting clientele.

Jean-Guy Amat has understood this, and explains:

This clientele is looking for nature, the outdoors, and camping can meet this demand. But the offer must be adapted, especially in terms of quality. And therefore it is necessary to invest to be competitive. Today, campground investments account for an average of 22% of their turnover, representing, for example, €160 million in investments per year in the outdoor hotel sector in the former Languedoc-Roussillon region. It is one of the few sectors that invests so much! 

He also specifies that this innovation goes hand in hand with a rise in range thanks to new clientele with greater means and thus higher expectations in terms of comfort:

On a national level, one in three French people goes camping today, according to a survey by OpinionWay 2018 for the FNHPA. This is a growing trend. Camping previously had a low-end image, but today we are reaching a clientele that has a much higher purchasing power.

This phenomenon is confirmed by counting the number of pitches as a function of the range of the campsite (see graph on the right). Two realities are evident. The first is that there is indeed a trend towards a move upmarket in the supply. 4-star campsites gained +29% more accommodations between 2010 and 2017, from 190,217 to 249,074 sites. The 5-star category is experiencing an equivalent increase, i.e. +27% growth over five years (2012-2017). This category, which was newly introduced in 2012, included 60,767 sites when it was created, and grew to 77,238 in 2017.

The second observation is the emergence of unclassified campsites in 2012 following the new classification made mandatory that same year. But these downgraded campsites are gradually disappearing: there were 232,425 unclassified campsites in 2012, and only 88,344 in 2017, a 62% decline from the initial amount.

Consequently, Jean-Guy Amat raises a yellow flag about this reality:

We are witnessing a decline in supply, with a decreasing number of pitches. Smaller operations are closing, either because their profitability is too low or because they face major administrative constraints and prefer to throw in the towel... Demand is thus difficult to meet, and moreover the government is aiming to increase the number of tourists in France to 100 million by 2020! Solutions must be found so that campsites can continue to develop in areas with heavy constraints such as coastlines, riverbanks or mountains, where it is necessary to reconcile the preservation of these sites with a high level of tourist activity. Campsites are beginning to think about it, but they will need to be supported by public authorities. We need to innovate to get out of existing regulatory frameworks and very standardized practices.

 

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