Will Changing the Way Timeshares are Sold, Change the Timeshare Industry?

Jean Francois Mourier is known as the REVPAR GURU. For those of you outside the business, REVPAR is an abbreviated term that means “revenue per available room” and is the way the hospitality industry measures the financial performance of a hotel.

In a recent article published in Hospitality.net, the Revpar Guru challenges the way timeshares are traditionally sold, via invitation (or wrangling) of potential buyers into a timeshare sales presentation, based on the promise of a gift (theme park tickets, free hotel nights, restaurant vouchers) in return. In a sense, timeshare sales reps are ‘paying’ consumers to listen to the timeshare pitch. If the potential timeshare buyer doesn’t qualify to buy the product or perhaps has no intention to buy timeshare regardless of what the sales rep says, then money spent on gifts and freebies to entice the buyer was wasted. Also wasted was the sales rep’s time pursuing a business model that is almost solely unique to the traditional sale of timeshare.

The Revpar Guru suggests that as the timeshare business seeks to rebound from the economic hit virtually all businesses have felt in recent years, now is an ideal opportunity to replace the sales models of the past with new structures that depend more on upon technology and automation. Here’s the nuts and bolts of his suggestion:

“So what if the business model was changed to selling timeshares the same way as hotel rooms are sold? To begin, this method would be less costly as vacationers wouldn’t need to be enticed with something free as they would have already have booked and paid their own hotel room. Approaching guests with the idea of a timeshare once they’re already at the hotel will make it more likely that they’d be interested in that property right off the bat—they did book a stay there on their own, so chances are they already like and are at least a bit knowledgeable about the particular hotel. This method can also potentially increase a property’s revenue as it can simultaneously make money from timeshares and hotel rentals from many of the same customers.”

Timeshare Sales and the Shifting Paradigm

To manage this type of booking, of what essentially would be timeshare rentals; automated online booking systems would enable consumers to schedule their stays without ever interfacing with the timeshare staff until they actually arrive at the resort. If the system was expanded, it could then make it easier for timeshare owners to pay fees or annual maintenance charges online as well. Now, let’s acknowledge first that in varying degrees at different resorts, these types of automated services are already in place or are being implemented.

Yet the core message here is very valid. It’s a paradigm shift. Consumers don’t shop for anything in the same manner they once did. People want to make their own buying decisions rather than being ‘sold to’. They want to go online and read product reviews and then use internet sites to help them compare prices and features. There is very little margin for selling anything to today’s consumer if the terms of the deal aren’t explicit, forthright, and delivered on their terms at the time and venue they wish to receive them. More often than not, that venue is their home computer where they can make a cup of coffee, sit back, and weigh their choices in a manner that is comfortable for them.

Yesterday’s models for buying and selling timeshare weren’t necessarily wrong, they just simply are not right any more.