Are high pressure sales techniques even needed in today's timeshare environment ?

[boyblue]

Do we really need high pressure sales techniques to sell timeshares? If developers didn't have to pay exorbitant commissions I bet the price per unit could be cut drastically and if they took the time to educate their buyers there wouldn't be so many owners trying to get rid of their units, which would slow the decline in timeshare value.

There was a time where a glut of TS were being developed and units needed to be gotten rid of, thus the importation of high pressure sales techniques. But now that development has slowed, wouldn't it make sense to educate rather than misinform?

 

[WalnutBaron]

It's always dangerous to attempt to bring common sense and logic to an aspect of the timeshare industry that is rife with lack of either. While I agree with your premise, the timeshare industry has been--unfortunately--built on a business model that employs high-pressure sales tactics with very questionable practices, including (but not limited to) slick, over-produced brochures and videos of beautiful resorts and related hotel accommodations in exotic locales; rampant dishonesty with inconsistent and oftentimes completely made-up sales claims; "shark tank" tactics that get "marks" off the property to another location, necessitating those marks to rely on the sales department for transportation back to their cars or vacation location and which therefore anchors them in the shark tank for hours and hours on end; inexplicable paperwork and contracts that bear no resemblance in what is actually included to the wild claims made by the sales department; and on and on.

I actually think it would behoove at least one or two of the so-called "majors" to consider a completely different strategy, touting the following:

• Complete transparency, including consistency between verbal claims made by the sales department with printed materials, including contracts;
• A commission structure based not only on completed sales, but also based on customer satisfaction 3-6 months after the sale;
• Integrity as a key element of an organization's M.O., thereby distinguishing that organization from the sleazeball tactics of all the rest.

We all know how revered Southwest Airlines is, for example, in the airline industry as the one airline that does not load up their published fares with subsequent "junk fees" that add substantially to the true cost of an airline ticket. How refreshing it would be to see that done by at least one of the timeshare developers.

One can dream...

 

[TUGBrian]

if it wasnt effective, it wouldnt still happen.

sad but true.

 

[Panina]

We know the high pressure works, getting many to buy on the spot.

The industry is obviously getting the sales, so why would they take a chance to do it differently.

Most of the car industry is the same. Back and forth, giving us the best price, at least that's what they also tell us.

 

[dioxide45]

If low pressure worked, someone would have stepped in and tried to corner that market and take market share. It hasn't happened because it doesn't work very well. Marketing and commission costs are about 50% of the cost of a timeshare. I don't know how they can get that amount much lower. The CEO of Marriott Vacations Worldwide has said that timeshare are a sold product. Very few people walk in planning to buy a timeshare. People aren't going to start buying if they just opened a retail store selling timeshares, at least not at the prices they are charging.

 

[DeniseM]

- How would you get anyone to sell timeshares for a minimal commission?

- If they were fully informed, why would anyone buy from the developer? - it's not like the developer can match the resale market.

 

[tschwa2]

DVC is able to sell with a lot less pressure and minimum gifting but they have fully committed to propping up resale value with consistent ROFR at a high level. Other developers are unwilling to do that.

 

[LannyPC]

Do we really need high pressure sales techniques to sell timeshares? If developers didn't have to pay exorbitant commissions I bet the price per unit could be cut drastically...

How else would you persuade a person to, on the spot, spend tens of thousands of dollars that he probably does not have, for a product that he does not need, or know much about?

And as for cutting the price drastically, how many "marks" who might or might not buy go thinking "Hmm, if it's $15,000, then I can buy but there is no way I am paying $18,000 for this."? That $3000 difference will have little effect.

 

[boyblue]

The same way a 401K helps you to save, Timeshare ownership strongly encourages you to take vacations, so in my book they're worth any investment; but when buyers get the sense that they've been scammed it's difficult to enjoy the product. A lot of folks get scammed a second time trying to get out of their obligation. There is value in TS ownership but the industry operates as if the opposite is the case.

 

[WalnutBaron]

The same way a 401K helps you to save, Timeshare ownership strongly encourages you to take vacations, so in my book they're worth any investment; but when buyers get the sense that they've been scammed it's difficult to enjoy the product. A lot of folks get scammed a second time trying to get out of their obligation. There is value in TS ownership but the industry operates as if the opposite is the case.

I agree. That's why I think there is room for a Southwest Airlines-style model in the industry. Here's how it could work (and yes, I freely admit that I am dreaming here and it's never going to happen--but that's what dreams are for, right?):

• One of the major timeshare companies decides to break from the pack and the sleazy reputation of their industry (which has been perpetrated by way of the sales weasels--not the hospitality staff) and create a new positioning for their product: "Integrity. Value, Memories. Come to XYZ Vacations Club to learn more."
  • The "Integrity" promise is fulfilled by hiring a sales staff that is trained to provide only honest answers to questions. Issues of upfront costs, maintenance fees, comparisons to hotel room costs, and other items must be provided with accuracy and without hyperbole, prevarication, and certainly devoid of outright lies and half-truths.
  • The "Value" promise is fulfilled by providing lower upfront costs of ownership. How are profit margins preserved? By lowering sales commissions. How will salespeople be properly incentivized if this happens? Lower pricing will help them sell more units, thereby making up the reduced commissions in volume. The present 50% sales commission structure leaves plenty of room to do this.
  • The "Memories" promise is fulfilled not just by ensuring great vacations for owners, but by allowing owners to come away from their total experience as a customer of XYZ Vacations Club feeling respected and positive.
• To support such a positioning, XYZ Vacations Club makes a major advertising splash in travel magazines and through interviews and public relations spots with travel writers of major publications. Their main talking point: "We know the timeshare industry has a terrible reputation, and a lot of it is deserved. We're here to change that."
• To create a more compelling sales proposition, offer more value for buyers of developer weeks--for example, a Platinum week buyer will also receive a free Silver week every other year; a Gold week buyer will also receive a free Bronze week every other year; all weeks owners receive two free nights per year at a 3-star hotel chain, etc.
• As the new business model takes hold, XYZ Vacations Club makes ample use of owner testimonials to reinforce the fulfillment of their promises--and the marked difference they represent as compared to the traditional, sleaze-bound industry everyone is used to.
• To the question of "Yeah, but what do the sales weasels say when a prospect asks them about resale?"
  • Re-emphasize the bonus weeks mentioned above and the free hotel nights--items not available through resale. In other words, close the gap in value between developer sales and resales to begin with. A 10-to-1 price differential for essentially the same thing is not sustainable. With the combination of lower upfront pricing (due to lower sales commissions), added off-season weeks as part of the developer-purchased ownership, and other goodies, lower the ratio to make a more compelling sales story.
  • Don't lie, but just don't respond to resale questions. A truthful answer--assuming the added value items described above are a part of the mix--would be "That's a different market. It works for some people and not for others. Let me again re-emphasize what's offered here..."

It's not going to work for everyone, but the Timeshare industry is so rife with bad actors and sleazeballs that there is definitely an opening for a company to break through all the sleaze and position itself as the guys in the white hats. We all know how fiercely loyal Southwest Airlines and JetBlue Airlines customers are. It's because those customers feel appreciated, valued, and know they're getting something not offered by the big, impersonal "major" airlines. It could happen in the timeshare industry with a little creative thinking.

 

[boyblue]

You are a dreamer! So am I - Some thoughts...

What's the harm in telling buyers that TS's are a depreciable asset?
If there aren't tax incentives like writing of loss on resale or MF being deductible, there should be
ROFR should help to keep the resale price out of the penny listings.
Why not go with a points system & charge MF based on points?

 

[LannyPC]

Why not go with a points system & charge MF based on points?

That's actually been discussed numerous times here on TUG. I don't have the time right now to look up those threads but there were some interesting debates about the pros and cons of such.

 

[pedro47]

Tell that theory of high pressure sales & lies are out to Westgate and DRI (Diamond) sales personnel.

 

[Nomad34]

I agree. That's why I think there is room for a Southwest Airlines-style model in the industry. Here's how it could work (and yes, I freely admit that I am dreaming here and it's never going to happen--but that's what dreams are for, right?):

• One of the major timeshare companies decides to break from the pack and the sleazy reputation of their industry (which has been perpetrated by way of the sales weasels--not the hospitality staff) and create a new positioning for their product: "Integrity. Value, Memories. Come to XYZ Vacations Club to learn more."
  • The "Integrity" promise is fulfilled by hiring a sales staff that is trained to provide only honest answers to questions. Issues of upfront costs, maintenance fees, comparisons to hotel room costs, and other items must be provided with accuracy and without hyperbole, prevarication, and certainly devoid of outright lies and half-truths.
  • The "Value" promise is fulfilled by providing lower upfront costs of ownership. How are profit margins preserved? By lowering sales commissions. How will salespeople be properly incentivized if this happens? Lower pricing will help them sell more units, thereby making up the reduced commissions in volume. The present 50% sales commission structure leaves plenty of room to do this.
  • The "Memories" promise is fulfilled not just by ensuring great vacations for owners, but by allowing owners to come away from their total experience as a customer of XYZ Vacations Club feeling respected and positive.
• To support such a positioning, XYZ Vacations Club makes a major advertising splash in travel magazines and through interviews and public relations spots with travel writers of major publications. Their main talking point: "We know the timeshare industry has a terrible reputation, and a lot of it is deserved. We're here to change that."
• To create a more compelling sales proposition, offer more value for buyers of developer weeks--for example, a Platinum week buyer will also receive a free Silver week every other year; a Gold week buyer will also receive a free Bronze week every other year; all weeks owners receive two free nights per year at a 3-star hotel chain, etc.
• As the new business model takes hold, XYZ Vacations Club makes ample use of owner testimonials to reinforce the fulfillment of their promises--and the marked difference they represent as compared to the traditional, sleaze-bound industry everyone is used to.
• To the question of "Yeah, but what do the sales weasels say when a prospect asks them about resale?"
  • Re-emphasize the bonus weeks mentioned above and the free hotel nights--items not available through resale. In other words, close the gap in value between developer sales and resales to begin with. A 10-to-1 price differential for essentially the same thing is not sustainable. With the combination of lower upfront pricing (due to lower sales commissions), added off-season weeks as part of the developer-purchased ownership, and other goodies, lower the ratio to make a more compelling sales story.
  • Don't lie, but just don't respond to resale questions. A truthful answer--assuming the added value items described above are a part of the mix--would be "That's a different market. It works for some people and not for others. Let me again re-emphasize what's offered here..."

It's not going to work for everyone, but the Timeshare industry is so rife with bad actors and sleazeballs that there is definitely an opening for a company to break through all the sleaze and position itself as the guys in the white hats. We all know how fiercely loyal Southwest Airlines and JetBlue Airlines customers are. It's because those customers feel appreciated, valued, and know they're getting something not offered by the big, impersonal "major" airlines. It could happen in the timeshare industry with a little creative thinking.

Why not dream of such a place? I feel this would have saved my deeds for my family to have enjoyed for years but when you had to unplug the phone and be considered rude by saying no to sales meetings the dream faded.

 

[bugzapper]

The availability of online pricing guides like Edmunds or Kelly Blue Book has helped prevent people from over-paying for cars. Ebay, Amazon and other apps provide quick pricing for other goods. I wonder why more people don't look online to find quick pricing information on timeshares? It would enforce more transparency in the timeshare market!

 

[WalnutBaron]

Tell that theory of high pressure sales & lies are out to Westgate and DRI (Diamond) sales personnel.

They're the worst, but high pressure sales tactics, lies, prevarication, misinformation, half-truths, and just plain old B.S. are pretty standard in the industry. That's why so many people stay away from timeshares--they've heard anecdotally about what sleazeballs the sales weasels are and never bother to look further. And they miss out on some great vacation opportunities with their families as a result.

 

[Larry M]

Do we really need high pressure sales techniques to sell timeshares? If developers didn't have to pay exorbitant commissions I bet the price per unit could be cut drastically and if they took the time to educate their buyers there wouldn't be so many owners trying to get rid of their units, which would slow the decline in timeshare value.

There was a time where a glut of TS were being developed and units needed to be gotten rid of, thus the importation of high pressure sales techniques. But now that development has slowed, wouldn't it make sense to educate rather than misinform?

GM tried that model with their Saturn dealerships. You walked in to buy a Saturn and paid the sticker price. Accessories were priced on a visible, non-negotiable menu. They didn't encourage trade-ins. No haggling was involved. And look how well that worked. Saturn Corporation b. 1990 d. 2010 RIP.

 

[jpurdon]

Villa Group is awful!

 

[Nomad34]

You are a dreamer! So am I - Some thoughts...

What's the harm in telling buyers that TS's are a depreciable asset?
If there aren't tax incentives like writing of loss on resale or MF being deductible, there should be
ROFR should help to keep the resale price out of the penny listings.
Why not go with a points system & charge MF based on points?

What is ROFR?

 

[clifffaith]

What is ROFR?

Right Of First Refusal

 

[Nomad34]

Thank you. Looked it up by Google but still unsure of how it works for my case. I am just happy that the charity I was planning to promote don't need my donation as the college will open in September 2018. I know someone would love my deeds beside Wyndham Ovation.

 

[TheTimeTraveler]

GM tried that model with their Saturn dealerships. You walked in to buy a Saturn and paid the sticker price. Accessories were priced on a visible, non-negotiable menu. They didn't encourage trade-ins. No haggling was involved. And look how well that worked. Saturn Corporation b. 1990 d. 2010 RIP.

Actually, it worked quite well if it weren't for the 2007 recession and GM going into Bankruptcy. GM shed Saturn and Pontiac in an effort to remain in business.

The quality of the GM cars are better today, yet Toyota and Honda continue to produce superior vehicles (this should promote a lot of chatter, lol).


.

 

[dms11]

I may be deluding myself, but I don't feel like I got a "hard sell" from the TS salesman at the Westin Lagunamar when we bought there a couple of years ago. In fact, when we said we were unsure, he said take a couple of days to think about it, talk to some of the guests who are staying here to see what they think and if you're still interested, come back before you leave. We did all that. Everyone we talked to was very happy with their Lagunamar TS; a coworker who is also a Westin (now Vistana) TS owner loves it as well, and based on our research, we took the plunge. As I have said elsewhere, we have no regrets. We not only love coming back to Lagunamar, but love the freedom to use our StarOptions elsewhere, as we are doing this year by going to Maui. That is something we could not have done via resale since Lagunamar is not a "mandatory" resort. So while buying resale may make sense for many, it did not make sense for us. It also helps that we were financially able to pay off the price of the TS pretty quickly, so we were not taking on debt we could not afford. That is something everyone should consider in deciding whether to buy from the developer or resale (since MF fees are still due even by resale buyers) or at all. For many, it may not make sense to buy a TS, since you can always rent one from an owner.

 

[zeld]

Perhaps what is needed is a truecar.com for timeshares.

A points system is just another monetary system with costs in conversion.

How do you profit from a low end motel with 50 units? Sell 2500 timeshare units at $20,000 for $50 million.

 

[Nomad34]

I never felt pressured in buying as I was so enjoying my vacations that would not have been as many if I had not purchased. After the death of my husband and son my daughter in law and granddaughter enjoyed two vacations at Sapphire Valley Fairway Forest before moving forward with our own deeds. Being Silver after our first purchase I was anxious to be Gold to avoid housekeeping fees. For me, I felt this was the cheapest vacation available for the money as each year we had the same opportunities for more places to visit and explore with only minimum fees when you consider all of the expense of owning several places with upkeep. Each place is certainly prepared to the hilt and feel treated well and have every need in the unit specially prepared. I had been spending $3000 to $4000 for trips each year and many times spent more on phone calls home than enjoying it. My only wish would be that my ownership would stay in the family and am sorry they aren't wanting it.