Timeshares are a booming business, generating over $10.5 billion in sales annually. The industry consists of vacation ownership resorts that divide condominium-style properties into units and sell the rights to use them for specific weeks each year. Despite its early reputation for questionable marketing practices, including high-pressure sales tactics, it has transformed into a reliable source of vacation accommodation. It is the fastest-growing segment of the hospitality and travel industry with over 9.6 million people in the United States owning timeshares. The emergence of leading consumer protection agencies and the creation of governing bodies in Europe and Latin America have increased the industry’s credibility and strengthened its market worldwide.
Despite the benefits of timeshare ownership, some consumers remain dissatisfied with the product. Many complain that the hefty maintenance fees and the inflexibility of a timeshare contract detract from its value, and some even opt for a traditional vacation rental instead. The fact that the industry’s costs may rise every year is also a concern for many buyers.
In an effort to combat these concerns, the industry has developed a variety of solutions, from offering discounts and special promotions to establishing a points system that allows owners to exchange their unit for accommodations at other resorts or hotels. This new point system has made it easier for timeshare owners to enjoy more vacation choices. Whether or not this is a good thing depends on one’s personal circumstances and what they are looking for from timeshare ownership.
While the new points system has allowed more flexibility, it also increases the complexity of timeshare ownership. The system is not well-understood by the general public, and some people find it difficult to understand how the points are awarded and when. Additionally, some consumers have reported that they cannot get the help they need from their timeshare company.
Another major challenge for the timeshare industry is consolidation. Several large publicly-quoted multi-site branded operators are dominating the market, and smaller independent developers face stiff competition. Many of these companies are pursuing merger and acquisition strategies in an attempt to gain a competitive advantage. However, a timeshare merger can be extremely complicated and requires a lot of preparation, especially when it involves obtaining regulatory approvals.
The timeshare industry has also faced significant criticism from consumer protection groups, including the Better Business Bureau (BBB). According to a BBB study, between 2000 and 2006, the BBB received 20,118 complaints from consumers regarding problems with their timeshare contracts. Many of these complaints involve difficulty getting out of the contract, as well as aggressive sales tactics.
Regardless of its challenges, the timeshare industry is here to stay. It has survived economic recessions, inflation, and even pandemics, and continues to be a robust sector of the hospitality and tourism industries. It is predicted that the industry will continue to grow in the near future, based on current consumer demand for vacations. As long as consumers are willing to spend money on travel, the industry will thrive.