We've heard horror stories about timeshare sales presentations where potential buyers are almost held captive until they make a purchase. Has anything really changed with timeshare sales pitches?
This is a very timely question, because most of the public, brand-name timeshare companies (who now call themselves vacation clubs) are actively trying to put a new "consumer friendly" face on timeshare sales presentations. This appears to be a wise business move as companies try to distance themselves from the traditional hard-sell pitches that became synonymous over decades with timeshare. It also helps attract the next-generation of younger buyers who scour the Internet, routinely, doing research and checking reviews of travel companies, resorts, and timeshare prices (on sites like RedWeek). These are the very same travelers who, so far, don't embrace the timeshare concept.
To answer the question, "Has anything changed?", RedWeek consulted executives with major developers as well as consumer advocates. We also canvassed board members at legacy resorts who have been exposed to many differing sales pitches over the years. Finally, we attended a half-dozen different sales presentations to see for ourselves how companies are adjusting their pitches to appeal to potential buyers. Here is our report.
The short answer is: the industry's self-governing reform efforts are making progress but still have a long way to go. Some developers promote "quality assurance" programs and transparency to ensure that customers are adequately informed about their possible purchase. To improve the consistency of their messaging, many companies are enthusiastically using high-tech tools, including videos, Internet presentations, and tablets, to educate owners and potential buyers about the benefits of spending an estimated $25,000 per week for a lifetime vacation option. Some independents, meanwhile, still rely on traditional four-on-one high-pressure pitches, grilling and grinding away on couples to get them to sign contracts. While buyers aren't chained to a desk, many still feel intimidated by the sales experience. Why do companies still rely on the hard sell? Because it works.
The timeshare's industry's chief lobbying organization, the American Resort Development Assn., has mounted an ongoing education campaign to upgrade the industry's ethics, practices, and reputation. ARDA's website is full of helpful consumer information and advisories for owners so they don't get scammed. From a public relations perspective, the industry is doing its part to encourage ethical business practices. But as long as some ARDA members still subscribe to hard-sell pitches, the entire industry will be stuck with the negative consequences of anti-consumer behaviors.
What's New and What's Old About Sales Pitches
According to industry insiders, all sales presentations are scripted, but they're not all the same. There's one script for first-time potential buyers, where sales people spend a lot of time trying to assess the travel tastes, and typical spending, of presentation newbies. Then they sell the gee-whiz of going anywhere you want, whenever you want, courtesy of a magic carpet ride called timeshare ownership. There's a second script for existing owners that tends to take less time and focuses on "what else" the timeshare owners might like to do on vacation. Both scripts lean on the long-held adage that timeshare ownership is a great hedge against the always inflating costs of hotel travel — and much more comfortable and luxurious, too, especially for families with little kids. Sales people always tout the supposed ease of reserving rooms at hundreds of resorts as well as the benefits of using exchange companies to visit out-of-network resorts. For older buyers, sales people also promote the idea of "leaving" the timeshare to your children so they, too, can enjoy supposedly endless, carefree vacations. At the end, after cajoling couples with same-day price reductions and more free gifts, companies always close their presentations by offering lower-cost "getaway" package to bring potential buyers back for another timeshare vacation. There are many variations on these approaches, but they cover most of the basics.
Here's what's different in today's timeshare presentations. With few exceptions, all major timeshare companies now sell points. Deeded weeks are dinosaurs and downplayed. Some companies, particularly in Mexico, are promoting fixed-term "right-to-use" contracts, similar to leases, that can last ten years or longer. (US-based vacation clubs also offer limited-term products that are known as "anti-timeshare" contracts.) One big advantage of right-to-use programs is that there are no resale market problems, nor any inheritance or title issues. When the lease is up, the timeshare membership reverts to the developer, while the former member walks away with no further financial obligations.
Today, thanks to several high-profile legal investigations of hard-sell sales tactics, honest sales reps no longer portray timeshare as an "investment" that will grow in financial value. They also shy away from making personal promises to potential buyers about perks or amenities they cannot fulfill. Instead, they stick to an updated script that extols new programs that owners can use with their points — these are so-called "experiences" that include cruises, golf excursions, guided tours, concerts, and charity golf events, among many others. So far, cruises and golf appear to be the most popular of these timeshare-alternative programs. Some companies (Diamond foremost among them) also tell owners that they can use points to offset maintenance fees and other travel costs (but only if they are elite owners).
Here's what sales people still avoid talking about. Secondary market issues, resale prices, take-back programs and the long-term cost of maintenance fees. Some also shun questions about rental programs, since their company specifically bans use of a timeshare for "commercial gain" in the purchase contract. These dodges are understandable, since sales people live on the front end of a timeshare experience, not the back end. We've encountered several agents, for example, who never heard of RedWeek.com, even though it has more subscribers, 2.5 million, than the Wyndham, Marriott, Hyatt and Vistana timeshare chains, combined.
True Timeshare Tales from Las Vegas, March 2018
Timeshare pitches come in many flavors. They show up in your mail box or arrive over the phone from unsolicited companies. But in Las Vegas, one of the timeshare capitals of the world, they pop up on almost every street corner and within the entrances of most casinos. During a recent RedWeek visit to Sin City, we were approached repeatedly, every day, by aggressive hawkers offering discounted show tickets and free dinners, among other gifts, to attend one of the dozens of sales pitches that occur daily along the Strip. The hawking part itself is big business, with scores of hawkers pushing presentations upon folks who came to Vegas for entertainment, not sales pitches.
We accepted offers from several. Here they are.
Tour #1: Vacational Internationale
Vacation Internationale is a 40-year-old, owner-controlled vacation club that offers points packages to potential members. During our presentation at the Carriage House, they showed a slide presentation of all the places people might want to travel and quizzed attendees about their travel preferences. They displayed a map of the US showing all the resorts in their portfolio — including at least one resort, we discovered later, that has no affiliation with VI whatsoever. The sales staff also mentioned having several programs where existing owners could trade-in or deposit weeks to get extra travel benefits from VI. But during an hour-long, low-key conversation, they never got around to offering a specific package with prices and benefits. They talked about the value of exchanging into Interval International but not about VI. They never showed us a unit at the Carriage House, either. Finally, they never answered our key question — why should we join VI? All in all, a very puzzling presentation. We learned more about the company from a half-hour on the Internet than we learned from the 90-minute, face-to-face sales talk. While the reps weren't pushy, they weren't very informative either. The Carriage House setting didn't sell the program, either.
Tour #2: Wyndham Vacation Ownership
Wyndham is the world's largest timeshare company, boasting 900,000 families and 220 resorts worldwide. They have several properties in Vegas, all offering high-end amenities and updated accommodations. We attended an owner update at the Wyndham Grand Desert, a handsome complex located a few blocks off the Strip that caters to families and non-gamblers. The sales staff was gracious and accommodating, more interested in our timeshare past than what I planned to do in the future. No hard-sell at Wyndham, but tons of talk about the joys of joining the Wyndham family and seeing the world at luxurious resorts at discounted (prepaid) rates. Wyndham's vast network (it has seven clubs under its umbrella) and its co-ownership of RCI, the world's largest exchange company, give it massive clout to impress travelers without torturing a hapless tourist. When it came time to leave, they showed us the tablets that all owners would receive, already loaded with all the software needed to scroll the Internet and, most importantly, connect immediately with Wyndham for future reservations. They offered a package of 126,000 points, plus a one-time bonus of additional points, for a same-day purchase. The last time we attended a Wyndham presentation, they offered a 201,000-point package, in the same $20,000 to $30,000 range for a week's worth of usage. Despite our refusal to purchase — and their repeated counter-counter offers — the Wyndham sales people remained personable throughout. Classy presentation, all the way.
Tour #3: Westgate Resorts
Westgate, the largest privately-owned timeshare company, is in the midst of a huge renovation of the former Las Vegas Hilton, which was the hub hotel complex for Las Vegas Convention Center. The recently renamed Westgate Las Vegas Resort & Casino is a massive edifice, with nearly 3,000 rooms, restaurants, and amenities. The newly renovated one-, two-, and four-bedroom suites are huge, even by Vegas standards, and offer spectacular views with floor-to-ceiling windows. It's also right next door to the Strip Monorail; adjacent to the future NFL Raiders football stadium and surrounded by other developments at the north end of Vegas.
Our presentation at Westgate started with a meeting of fellow travelers at the Planet Hollywood mall, where we assembled for a van ride to the resort. We were told the presentation would last 120 minutes, but competing hawkers told us, "it will take three hours." They were right. In any case, the van delivered us promptly to the resort, where we were ushered into a huge breakfast room that used to be the former Star Trek experience at the Hilton. This space is larger than an NBA basketball court, and it's all timeshare presentations, with one exception. All of the Star Trek paraphernalia and wall adornments remain in place, as if Captain Kirk will arrive at any moment to sell a timeshare.
Kirk and Spock never showed, but we did run into "Jim," a weathered timeshare salesman. He told us he could not start his presentation until we finished breakfast, so we ate as fast as possible, then told him to march on. We knew we were in trouble, immediately, when he advised us he hates salesmen. Anyway, Jim did his best, but it was a big waste of time since we were not in a buying mood. He did not use any technology or computers. He just scribbled notes on a piece of paper and pounded the table with his pen when he wanted to make a point. We told him we just wanted the pitch, not the preamble, but he told us he would be fired if he did not do the entire presentation, start to finish, so we relented. He said Westgate still sells weeks, and openly trashed points programs as bad for consumers. When we asked, "what's unique about Westgate?", he offered the following: if we buy into the program, we'll never have to pay maintenance fees. We asked for details. He said, if we give them two customer referrals per year, and the referrals bought, we would get $600 each back from Westgate. As a bonus, we would receive a 1099 at tax time showing we were, in effect, sales contractors for Westgate. Interesting, but not what we had in mind. Two referrals, in effect, would offset the nearly $1,200 maintenance fee on Westgate's units.
Two hours later, we got the final pitch. (Spoiler alert: if you recently bought timeshares at this resort, do not read the rest of this Ask RedWeek).
When Jim exhausted us, he brought in the closer, a dandily-dressed fellow with a flair for drama who looked like he also did magic acts on the Strip. After flourishing arm movements and writing on many papers like a mad accountant, he offered us a one-bedroom villa suite for $90,000, or a two-bedroom for $120,000. Good for one week a year, or perhaps two weeks if traded in to Interval. We scoffed at the price but told him that $30,000 would be something to talk about. Without missing a beat, he tore up the original sales papers, scribbled some more (for 20 seconds), then came up with a better offer: $30,000 for the same unit. Flabbergasted by the gap between the two offers, we countered again, saying, "how low can you go?". He did some more dramatic scribbling and checked his cell phone, then advised us that they just happened to have one traded-in unit that he could offer for $20,000. We said no again, so he returned with the final final offer: $10,000 for an every-other-year unit in Las Vegas.
We declined, since we already knew that the same unit was available, same day, on RedWeek for $8,000. Exit Westgate.
Tour #4: Diamond Resorts
To get a nice one-bedroom villa at Polo Towers, which is one block off the Strip close to the MGM Grand, we purchased an "Event of a Lifetime Package" from Diamond. This package includes a buffet dinner and breakfast, a fancy dinner and two show tickets — as gifts for attending a mondo-presentation to persuade owners to upgrade to Diamond's Platinum level of ownership.
We were happy to check this all out, but upon arrival for the 6 p.m. VIP check-in, the package disintegrated. Diamond's concierge informed us that they were overbooked and, as a result, we were bumped from the entire program. No dinners, no nothing, not even an obligatory presentation.
Since we were already in the lobby, they were happy to provide us with a room, but all the other stuff was out. When we complained, they gave us dinner and show vouchers and wished us well.
It wasn't a bad outcome. We got our personal time back and some nice gifts, but did NOT have to attend a Diamond sales presentation. Didn't matter much, either, because we attended a brief Diamond owner update in Scottsdale one week prior to the Vegas trip. At that presentation, they offered a $3,995 getaway package for 20,000 Diamond points with no maintenance fees.
Truth in Timeshare: this is the fourth time in one year that Diamond has solicited this owner to attend owner update presentations. We got bumped from three of them, including the Vegas package. One week after returning home from Vegas, we got an unsolicited timeshare call. Guess who? Diamond marketing department, offering another four-day, three-night getaway in Las Vegas...
So, bottom line: some of the same tactics are still in place, but overall there are pleasant ways to attend a presentation. Have you attended a sales pitch recently? Tell us your story in the comments below.
