A serious question. This could be a game changer!

[charlie1]

The post above is relating to an Independent resort that has a growing list of members requesting to leave through a life style challenge followed by another list of members concerned for the future if they are locked in. How this may affect their beneficiaries.

What to do? In this case lets paint worst-case scenario. Various aspects have been discussed over different posts so anyone with real interest can piece together something they could work with if they have some responsibility within their Timeshare Company that can help to influence change.

In this case the resort has no sales people or wishes to employ one. They have a high percentage of members that either want to exit now or in the near future.

Understand that your biggest challenge could become an opportunity!

1) The resort needs to establish where they are not just in terms of their own resources but where their most important asset is in this and that’s their members. The Timeshare Company needs to put together a simple survey that with will establish where they are with their members and their thoughts on their future holidays and exiting. There should be two slightly different surveys with one aimed at those members that have approached the resort wishing to leave with serious life style challenges. Then a less direct survey regarding exiting and more on their holiday plans to the remainder of your members.

Both surveys should also ask simple questions to establish if their members are familiar with best use of timeshare. As this may simply be a case of your members not making best use of their timeshare product and some education may be required. Where appropriate introduce another additional Exchange Company.

2) Review you’re existing product and consider how you can bring about a balance to make this more attractive to potential new members. If you don’t have an exit strategy with the poor PR so easily available then potential members will be seeking Timeshare Companies that will have this in place.

What should be strongly considered is how your product becomes a more flexible contract for existing members so they will have no further concerns about exiting or transferring their timeshare ownership to friends or family. The contract also needs to be updated to make this more attractive for selling privately or for legitimate resale companies to sell for your member or for the resort. Your happy members will become your best ambassadors!

Next anything you consider within your product must also depend on your resorts personal situation. Exiting options should be considered to give times to allow the resort to adapt and protect its financial variability. Say the first exit option could be 3 years. This would allow the thinking Timeshare Company plenty of time to adapt and take advantage of new members joining if they take the right steps.

3) If the resort has no pro-active sales, then approach a thinking legitimate Resale Company that will work with you to help sell your own stock and that of your members. Review past posts to ensure that the Resale Company just does not charge for listing your resort weeks and does not just display a long list of weeks so that your resort looks like a problem

4) Establish your unique selling points as a resort so you can identify your ideal members. Also review past threads and how to promote low season weeks and those new members that would be ideal to consider them.

5) Work a simple marketing plan that enables an approach to your identified ideal clients. All this has been discussed on the other threads but as mentioned it is beyond this forum to take this to any real depth.

6) Set up agreed meetings with the Resale Company approximately every two months. This should be reviewing agreed targets and what can be done together to improve the selling opportunities with the resort weeks. This could be about upgrading the resorts website or allowing access to rental weeks on a try before you buy approach. Perhaps further surveys with an incentive to return them as your members with the right questions will reveal to you what would needs to be in place to make your resort and timeshare more attractive. You may be pleasantly surprised as some feedback may just need a little fine tuning by the resort.

7) Once your plan is up and getting results then the resort should allow all members that have a genuine proven life style challenge that wish to exit should be able to do so. This will be great P.R for your resort.
 
The right personalized plan could turn a resort from being a potential future liability into a resort just offering the type of product that appeals to existing owners and is attractive to potential new ideal members. If the contract has built in exit strategies with say an initial 3-year exit option and subsequent 5-year exit options and once say your members reach the age of 75 this is reduced to 2 years this would be a fair balance in my opinion. All exit options have to have 12 months notice the resort has the time to turn this challenge into an opportunity. This is just a suggestion and each resort needs to ideally come up with its own personalized plan before I fear this decision is taken away from you!

9) Your members would no longer be scammed by Fraudulent companies enticing them to leave with schemes if your members feel that they are locked in.

The Timeshare Company that has no real fair exit strategy is just dodging bullets. Rather than talk about it action needs to take place and some real thought  given to the alternative of doing nothing but treading water. This can only eventually get more complicated as the resort looks for more cost saving areas and how they can keep hold of their members as long as they can and find ways to extract extra monies from their existing memberships with upgrades or for them to pay to exit. That’s not a plan that will create good PR or entice new members to join.

The Internet has evened up the playing field and there are plenty of forums forming that are now easily found by a simple search by curious potential members. What message are you sending out now to new potential members and existing owners at your Timeshare Company.

If the leadership is there and pro-active you can be seen first as a Timeshare Company that has listened. With some simple marketing and good PR on the forums you will reap the benefits and be a Timeshare Company that will be considered first before those resorts who simply lock their members in and hound them with threatening letters.

 

[charlie1]

Resorts need to focus now and realise that exiting has to be addressed. They need to come up with a personalised strategy fairly quickly in my opinion rather than to keep leaving this to chance that  if the European commission instigate legislation it may not suit their timeshare companies own particular requirements.

We are aware that the Israel project allowed timeshare owners to just give 12 months notice to exit. Those that did not exit immediately it would appear had a further 3 year option to exit. This is what the EUC was reviewing and this sent alarm bells ringing with RDO and TATOC. There are timeshare companies that have a high percentage of members that would consider exercising a 12 month option to leave if this was made available to them.

Thinking resorts should have been putting together a personalised plan now. We are where we are and this should have been in place years ago and you would have had a more desirable product that would have been more attractive for your members to transfer to family or friends or to sell on that sadly for some timeshare companies is history.

Based on my experiences in the Financial Services Sector that had similar problems nearly 30 years ago we adapted long term contracts to have exit breaks.

Resorts should work around their EXISTING contracts to make them more attractive
1) For the younger generation to consider and those with families
2) Make this a more flexible contract so members and the resorts can sell them on without the stigma of being locked in.
3) Exit options for existing contracts - To have the first option to exit in say in three years as this would give the resort time to get its act together, as this would enable you to work more closely with your members making timeshare more attractive to them so they would want to stay. Also a great opportunity with this time to market for new owners. If you follow previous advice on this forum and personalise your marketing you don't necessarily need a salesforce and this would be very cost effective rather than the old way of just marketing just any one that has a pulse. This was covered in the thread Is this your resort how to turn it around http://www.timesharetalk.co.uk/index.php/topic,18773.0.html After the first three year option in the existing contract this could be every 5 years up to age 75 then its just 2 years. All would require 12 months notice.

Those members that have a health issue that can be proven and just can't holiday well in my opinion they should be able to hand back their weeks with immediate effect if thats what they want to do. That would be the right thing to do. However with a more flexible contract with exits they may wish to try to sell or transfer this to family or friends.

I am not saying the aforementioned is ideal for your resort but it could be something to work on. Don't end up being a timeshare company that ends up having a knee jerk reaction charging desperate members to exit because if this is deemed to be unfair it may well be that the EU Commission might reverse this with payment back to the member.

The clock is ticking….You have a choice. Turn this challenge into an opportunity!

[charlie1]

Now that the EU are reviewing those Timeshare companies that lock their members in what are you going to do?

Answer well we have introduced Fractional Ownership schemes and similar short term products so members can 'upgrade' and buy themselves out by having a pre-determined term and if it sells at the end of the term maybe there’s a chance of a return of some money with the F.O??

Fractional ownership is highly unlikely to be considered by the EU as a fair exit strategy. What else could you do to assist your members to exit fairly?

Answer Well we need to protect the financial viability of our Timeshare Company as we just cant allow members to leave we need a plan. We could offer them an option to pay a multiple of their maintenance fees! That would provide us with a capital sum and free up timeshare product that we could sell again!!

But wont that stop new members joining if they see that you have to pay to join and then pay to come out. Wont they see this on the internet?

Answer I never thought of that! But I think it will blow over and we will get a ton of money and we got more timeshare products to sell from members handing back stock. It will end up as yesterday’s news.

What if there was a better way that could enable those members to leave on a fair basis and at the same time create good P.R with a feel good factor? What if you made your long-term contracts more attractive to new members?

Answer Sorry I’m not listening. I’m sure that your situation wont provide initial capital and I wont get timeshare products back that we can sell again if that’s what we choose to do with returned stock. This way we get to ensure that we got capital in and we can generate a safe cushion.

Is this not just short term? If it’s just a one off multiple of maintenances that allows those members that want to leave now? What about say three years time when you got other members that want to leave? Is this not just a short-term solution?

Answer Now that you mention it the problem may rise again. But hey we can do this again!

But in the meantime though your Timeshare Company will not attract new members. What about all that lost revenue because its unlikely that your not have many members join as your reputation on the Internet is not like yesterdays newspaper. The Internet holds news forever and that’s found with a simple Internet search.

Answer Dam we had it so good before the Internet. So what can we do? I’m listening how can we still create a happy membership that will help attract new members with some good PR and bring in some capital.

A personalised solution is called for. Survey your members and establish your list of happy members and those that perhaps are not working the system properly – so educate them. That will leave those that need to exit maybe through lifestyle challenges.

Answer That sounds like a lot of hard work to get the questions right and a process to ensure we get a good response. I can see the advantages of having that information. So what’s next?

Depended on your resorts personal circumstances and your memberships responses. Those members that can prove a life style challenge that stops them from holidaying should be allowed top leave ASAP. That’s good PR! Next dependent on your resorts circumstances allow those members that wish to leave. (you will roughly know that figure through your survey) This could be in an exit option in 2-3 years time. Offer them that option to exit within a specific time frame. The differences are that your members ideally should not be paying their maintenances upfront but rather continue to holiday and pay maintenance as normal until they exit. That’s great PR.

Those that want to leave regardless now because perhaps they cant take holidays should be offered that opportunity to leave now with the maintenance paid up front until that exit option. They could be offered a discount on their maintenances whenever your exit option date is if paid upfront.

AnswerBut that wont provide us with as much capital upfront or taken back as many timeshare products.

It will allow you to generate capital because your long-term product now has an option where members can leave without paying a multiple of timeshare maintenance fees upfront, they have a choice. Your long -erm contract offers additional exit options maybe ever 3-5 years during the term of your contract with your member giving 12months notice before each option. This will make your long-term product more attractive to new members.  At age 75 a members exit strategy could be every 2 years.

This gives you 2-3 years to build before the first option to get new members in with the right marketing and selling products.

AnswerBut we don't have a salesforce

Then either contract a sales team in or work with a pro-active Resales Company that is not just going to list your weeks on their website. They will work with you starting with your website as thats one of the first ports of call when someone is considering your timeshare company.

Answer So your saying I can allow members to leave in 2-3 years and for them not to pay cash up front while using their membership up until their exit. I suppose members might be happier transferring their memberships to family and friends if they know they are not locked in. They could sell their weeks more easily with a more attractive product and Resale companies would find it easier to sell our new flexible product. I’m beginning to see the benefits and I will find it easier to bring in new members! I wont get bad press and I will still get capital in with new members joining and some will still want pay to leave now.

So will you do this it makes sense if we all offered something like this as a collective.

Answer Sounds like hard work because my members could leave just giving 12 months notice before each exit option.

That’s your incentive to ensure you connect and work with your membership. Listen to them and help educate them on best use. However new members are joining and more transfers are taking place with member’s family and friends.

Answer Well no one else appears to be doing this and no one is really offering up any solutions - but they are still talking about it. So I think were just go for the money now and see what happens….

Why does that not surprise me….

[Mavo]

The above scenario as posted by Charlie1 is unfortunately not tongue in cheek. It really is the current mindset of the shortsighted industry who, over the last weekend, have participated for yet another year in "debates and discussions" to quote from the TATOC conference...Note, yet again. the annual absence of the word Decision.

So we are faced with another period of Greed and Short Term Gain, resulting in the further decline of the industry who will continue to be unable to attract new blood into the memberships and long term pain for consumers many of whom are becoming too infirm to even attempt the journey to resorts in Europe let alone around the world.
The industry is awash with clever minds who only seem to be able to concentrate on the short term and "the next little earner"
The internet meanwhile is screaming out to them to wake up to reality.
OK. Now the EU Commission have become involved, something will happen but it will only come about because the industry has had to be dragged screaming and kicking towards the inevitable and they will have fought tooth and nail for a directive which is slanted heavily in favour of their continuing participation in the  accumulation of wealth.