RCI Perspective....

SWINGIN' TO THE BEAT OF

SINGLES AND SENIORS    

The days of targeting only middle-aged couples with kids are over. Timeshare resort marketers used to think their perfect prospects were couples with an average age of 37.3 years, 1.7 children, and a household income of $56,170.17. But times have changed in timeshare marketing.

The typical timeshare consumer is still an upper-middle-income, middle-aged, well-educated couple. But this is just an aggregate profile. Many important segments have developed, including high-income households, high educational attainment, singles, and seniors.

The demographics of America mean many more opportunities for resorts to market to these new audiences. Two of the most exciting areas for many resorts are singles and seniors.

The singles market continues to increase, as young people wait longer to get married and as households headed by a single parent become more prevalent. The number of seniors is still growing, as the baby-boomers age and people live longer and healthier lives.

THE RESEARCH

Last year marked the 15th anniversary of the first nationwide study of the U.S. timeshare market by Ragatz Associates. There have since been six more studies, with a comprehensive survey in 1993. This body of research reveals an opportunity for swinging to the beat of the singles and seniors markets.

Major changes have occurred in the timeshare industry in the last 15 years. Annual sales volume has grown from around $300 million in 1978 to $1.5 billion; the number of timeshare resorts has grown to almost 1,000 from less than 250; and the number of households owning timeshare has increased from less than 100,000 to more than 1.5 million.

This explosion led to maturity in the industry. Participating companies have evolved from small- and medium-sized firms to major leisure companies. The product and marketing have also greatly improved, leading to the growing markets for singles and seniors.

The 1993 survey, sponsored by the Alliance of Timeshare Excellence, shows a dramatic increase in the number of single and senior owners and buyers. These statistics reveal great marketing opportunities for resorts.

The percent of single owners increased from just 7.4% in 1978 to 13.7% in 1993. Single males make up 5.4% of owners (up from 3.8%), while single females make up 8.3% (up from 3.6%).

The growth in the percentage of single owners is partly attributable to the growing proportion of non-couple households among earlier purchasers, due to divorce and death of spouses. However, in 1991 and 1992, single buyers still made up 12.8% the total. It's hard to ignore this growing segment.

National demographic studies reveal that there are simply more single people in the U.S. More divorces and decisions to stay single have created a market for timeshare resorts. To target singles, many successful resorts have adjusted their product and marketing accordingly.

The percentage of senior owners has also grown dramatically. In 1978, only 20.3 owners were over the age of 55. In 1993, more than 35% of owners were 55 or over.

Part of this rise is due to the aging of the timeshare ownership base. However, a 1992 Alliance for Timeshare Excellence survey revealed that more than 38% of recent buyers were over the age of 55. The seniors were obviously swinging at many timeshare resorts.

Peter Yesawich, president of Robinson, Yesawich, & Pepperdine in Orlando, says, "Recent research definitely indicates increased interest among singles and seniors." His firm is a full service marketing, advertising, and public relations agency that specializes in hotels, resorts, destinations, and travel service companies. Hilton Grand Vacations Company is a client.

The RYP/Yankelovich Partners National Travel Monitor reviewed travel habits, preferences, and intentions of Americans. The survey found that single people are more interested in purchasing a timeshare unit than married people. It also found that interest in buying a timeshare unit remains relatively high until prospects reach the age of 65.

It's obvious that singles and seniors are a strong market. But it's imperative that there are appropriate resorts and marketing methods to sell them.

THE RESORTS

The biggest marketing tool is having the right resort for the right markets. A timeshare resort will attract buyers who like their resort and amenities. Many successful companies feature amenities that match the desires of singles and seniors.

The singles market is typically interested in saving money on future vacations and enjoying the resort ownership experience through visits and exchanges. Thus, it is very important for resorts to keep prices reasonable and to provide amenities singles will enjoy.

Trendwest Resorts, based in Kirkland, Washington, has done well with the singles market. Trendwest's 14 resorts provide flexible and high-quality vacation ownership experiences at affordable prices. "Our resort properties are likely to be attractive, yet modest, without expensive amenities or other little extras that drive up the cost of units," says Trendwest president Bill Peare.

This combination is attractive to singles. Most Trendwest members are from the active northwest. Many of the units are within five hours of Seattle, providing short trip possibilities for active singles. Two Hawaiian locations provide more exotic getaways.

This vacation ownership convenience and affordability appeals to many singles. It's a combination several companies are now marketing successfully.

Las Vegas provides a perfect setting for both singles and seniors. With projects like Polo Towers and the entrance of Hilton Grand Vacations Company, Las Vegas may become the next timeshare mecca for both segments.

"There is an outstanding track record for sales and marketing success in the Las Vegas market," says Las Vegas timeshare consultant Jim Broughton. That's because there are timeshare resorts and marketing methods attractive to singles and seniors.

The senior market is especially interested in the resort, the amenities, and the units. In the recent Ragatz survey, 55.9% of seniors cited the resort facilities as an important motivation for purchasing, while only 41.1% of those under 40 listed the resort as an important motivation. Younger buyers were much more concerned with saving money on future vacations, while older purchasers were much more concerned with the quality of the resort where they were buying.

Thus, many resorts are marketing the uniqueness of their vacation experiences to seniors. Timesharing takes different strokes for different folks and it's easy to identify these strokes for seniors.

The Welk Resort Group provides a perfect example. They have the perfect products for the senior market and they market accordingly. A visit to a Welk Resort Group property is often like a visit to an active and busy retirement community.

The obvious draw is the legend of Lawrence Welk. He entertained millions of people who want to relive that enjoyment at a pretty resort. Many of these people are now seniors.

Lawrence Welk Resort Villas is a 286-unit luxury vacation ownership project at the 1,000-acre Lawrence Welk Resort in Escondido, California. Each villa is easily-accessible (often important to seniors) and richly decorated, offering two bedrooms, two baths, a living room and dining area, full kitchen, and a patio or balcony. The villas are perfect for children and grandchildren.

Every unit overlooks the golf course. Golf is an important selling point for many seniors. There are also many other active opportunities for the senior set, in that today's seniors are much more interested in pursuing sporting interests.

There are constant reminders of Lawrence Welk throughout the property, appealing to the memories of many fans. Another selling point is the popular dining room and theater, with a wide variety of shows.

The Welk Resort Group also owns and operates Lawrence Welk Desert Oasis in Cathedral City, California, in the heart of the famous "desert playground" that includes Palm Springs, Rancho Mirage, and Palm Desert. The location and the amenities are very popular with seniors.

The one-bedroom villas are surrounded by a championship 27-hole golf course that's often filled with smiling and sun-tanned seniors. There are also ten tennis courts, a swimming pool and spa, and many other amenities that appeal to seniors.

Dave Clifton, a Hilton Grand Vacations Company executive and veteran of the Welk Resort Group, has been very successful in understanding and attracting seniors to the timeshare market. He says, "Seniors have the time and money to spend and they are excellent decision-makers. You can't fool them, but they will buy if you provide a quality product."

Clifton feels there are many misconceptions concerning seniors. He says, "They don't view themselves as old and they are generally much more adventurous than we think. They love the jacuzzis!"

Resorts targeting the singles market also find ready buyers. Many resorts have traditionally avoided single prospects, feeling lower incomes lessened the chances of purchase. Data at resorts with amenities for singles (e.g., recreation, sports, children's events, nearby activities, and other single owners) has shown that single prospects often make perfect purchasers.

Marty Yancy, at Palmetto Marketing in Myrtle Beach, South Carolina, targets the singles market. His firm markets resorts across the nation and has found single people have a 20% higher purchase rate and 50% lower rescission rate than their married counterparts.

Due to their experience and success in marketing to single prospects, Palmetto Marketing eliminated higher income filters and other unique requirements for single prospects.

Branson, Missouri is another gold mine for timesharing seniors (and resorts). For instance, the Argosy Group's Plantation at Fall Creek targets seniors with a great site location, unit design, pricing, and Branson's entertainment features. In contrast, the Argosy Group's Cypress Pointe Resort in Orlando is more popular with singles and is marketed accordingly.

"Branson is unique, because it offers a variety of activities for the senior group," says Surrey Vacation Resort manager, Gary Henton. "Along with our resort experience, we can offer big-name entertainment, arts and crafts fairs, autumn leaf festivals, a big Christmas festival, and three beautiful lakes."

Like many resorts marketing to seniors, the Surrey Vacation Resort offers easy access to amenities and attractions, senior citizen discounts, coupon books, free show tickets, and much more. This is all reviewed during the sales presentation. "With seniors, we have found you will be successful if you under-promise and over-deliver," says Mr. Henton.

EXCHANGING

All national timeshare owner surveys have shown that the exchange opportunity emerges as the most frequently cited motivation for purchasing a timeshare interval. The average has been 81.6% for the past fifteen years.

As the exchange system has improved dramatically, the significance to potential buyers has increased (it was just 75.3% in 1978). The flexibility of vacation location made possible by companies like RCI is a major factor to singles and seniors and must be emphasized.

Singles and senior prospects are ideally suited for using and enjoying the exchange system. Single people (including one-parent households) are generally more adventurous in trying new locations and experiences. They tend to exchange more often than other demographic groups.

Senior owners are also active exchangers. They have more time and money to enjoy the exchange experiences. Seniors often become experts at enjoyable exchanges with RCI, making them ideal for the referral system.

RCI makes it easy for resorts to use their exchange system to market to senior and singles. The point-of-sale system lead to increased sales and less rescissions at any affiliated resort.

The RCI point-of-sale system includes: a new RCI Member Benefits brochure; the RCI New Member Kit; full-color sales binder insert sheets, reflecting the resort's sales message; and a wide variety of new sales posters.

Singles and seniors want to exchange and smart resorts can help them do it. But they have to buy before they can exchange.

MARKETING

Though having the right facilities for singles and seniors makes marketing easier, it's still a matter of reaching the right people and telling the right story.

With today's sophisticated list generation, it's simple to find singles and seniors who might be interested in timesharing. The most popular forms of buyer contacts are direct mail (35.7%), contact by project personnel while in the resort area (26.4%), telephone marketing (6.2%), and advertising (3.6%).

Referrals count for almost 14% of buyer contacts and this number is growing, as timesharing's reputation and experiences improve. Single and senior owners tend to network more than most demographic groups, making for an ideal referral marketing method for resorts.

Many people consider Walt Disney World, the Disney Vacation Club, and the general Orlando area as a destination primarily for families. However, timeshare marketers are finding that many singles and seniors are also visiting (and buying).

Now in its third year of successful sales and operation, the Disney Vacation Club is now doing much more "micro-marketing." They have found it is easy to attract families to the resort, but that singles (often single parents) and seniors (who bring their grandchildren) are also ideal prospects. It's just a matter of exposing them to the Disney Vacation Club concept.

"We have definitely seen interest from singles and seniors," says Disney Vacation Club marketing specialist Keri Lowe. The addition of a an oceanfront site near Vero Beach should attract even more singles and seniors.

Hearing and heeding the words of many recent focus groups will lead to more purchasers and happier owners. Ragatz Associates recently released "Impacting the Image of Resort Timesharing: Results of 16 Focus Groups Conducted with Non-Buyers and Buyers of Timeshare Intervals."

The findings of this study are changing the way timeshare weeks are sold (and enjoyed). "We feel the contents are very interesting and should help guide the future of the resort timeshare industry," says Dick Ragatz.

ARDA, through the Alliance for Timeshare Excellence (ATE), has made a commitment to educate members and inform them about tomorrow's timeshare buyers. This study was the beginning. A total of sixteen focus groups were conducted for eight development companies belonging to ATE.

The focus groups concentrated on what consumers thought about the sales process. "High pressure, inflated drops, and hard closing styles are what consumers expect when they attend a sales presentation," says industry veteran Clay Barnes. "Those companies who are looking for higher closing percentages and lower costs per sale should listen to what consumers say about our sales practices."

The recent experience of many progressive Alliance for Timeshare Excellence resorts reveals that the timeshare industry needs to listen to what many single and senior consumers are saying (or often shouting). Several resorts have already implemented the recommendations or plan to soon. Paying attention to non-buyers and buyers has proven to lead to more sales, as well as happier owners and potential purchasers.

Singles and seniors definitely have pre-conceived opinions about the timeshare industry. Most potential buyers have attended other sales presentations, have friends or relatives who own, or already own themselves.

The image of the timeshare concept prior to attending a sales presentation is still generally negative. Thus, many resorts have a difficult selling environment before the sales process even begins.

Focus group participants said problems that people usually associate with timesharing include: high-pressure marketing; bankruptcies; unkept promises; escalating maintenance fees; poor upkeep; resorts being dropped by exchange companies; exchange not working; and resale problems.

Most focus group participants felt that the industry has come a long way in overcoming the negative image by improving the product and sales methods, as well as benefiting from the entrance of recognizable companies. The general consensus was that timesharing is an excellent concept, but that there are still abuses in the marketing and selling processes.

Single purchasers are much more likely to hesitate because of unfamiliarity with the concept, the idea of an annual maintenance fee, the cost involved, concerns about promises, and feeling that the sales presentation was too high-pressured. Understanding these hesitations can help salespeople.

Senior purchasers are more concerned about not using their interval, having heard or read something negative about timesharing, and finding travel to the resort inconvenient. Salespeople aware of these concerns can address them successfully.

"Developers need to provide the amenities and marketing methods for singles and seniors," says Bill Hoag, president of Marketing Advantage in Little Rock, Arkansas. "These are two emerging markets that cannot be ignored."

There is little question that marketing to singles and seniors is smart. It's just a matter of having the right product, reaching the market, and using the right sales techniques. For smart resort marketers, it's easy to swing to the beat of these two groups.