Simon Jaworski and Lance Henik of Leger
You are never going to be able to design one ideal timeshare that meets
the needs of everyone. However, with the help of the ARDA International
Foundation (AIF) and utilizing the insights garnered from its recent Next
Generation research, you might be able to move a little closer to this goal.
With this research, it has been found that four core factors account for more
than half of all decisions made among both Millennials and Generation X’ers
when it comes to purchasing a timeshare property. Let’s take a look at these
Factor #1: Commitment/Cost Balance.
The most important features, accounting for one-third of all decisions,
are related to commitment. Both current timeshare owners and non-owners
alike mentioned that the “length of contract” (the number of years they were
willing to use the property) and the “interest rate” (a long term financial
cost commitment implication) attached to this purchase were the two most
In spite of the importance of the length
of contract and interest rate, there are, of course, two core cost
factors for purchasing a timeshare that cannot be overlooked. When these
traditional barriers to entry, the “overall price” and “annual fees,” are added
into the equation, these four features collectively account for the majority of
a potential timeshare owner’s decision-making process.
Factor #2: Sleeping Capacity.
After the key financial aspects, the size of the lodging is also an
important factor, with “sleeping capacity” as a key feature. This has increased
relevancy and appeal with the younger age groups, specifically Millennials, who
want to vacation with larger groups of friends—more so than any of the previous
generations of vacationers.
Factor #3: Exchange.
Next on the list of priorities is exchange. The positive impression and
need for a product that allows both options for an internal and external
exchange is definitely held in greater need by older Gen X’ers, especially when
compared to Millennials who may not be fully aware of the benefits of
exchanging their timeshare (a clear educational opportunity!).
Factor #4: Exit Strategies.
Although a hot topic within timeshare right now, “Exit Strategy” showed
slightly lower importance when compared to the exchange feature. The discussion
of this topic is not only relevant but it also has merit— particularly to
potential new entrants, as non-owners are definitely more intrigued by the
potential for a buy-back option. If positioned correctly, the option to buy
back a timeshare could lead to an extra layer of security that potential buyers
often crave before signing any legal documents.
So, what key conclusions can we draw from
this study? Non-owners tend to be more
sensitive to price than owners, flexibility is key in the sales process, and
those who sell timeshare should strongly consider a wide product portfolio. Read
more about this study in the May/June 2016 issue of Developments magazine