June 29, 2012 — A new study by Bankrate.com can be interpreted to suggest that there has never been a more appropriate time for timeshare developers to face the reality that a significant number of their sales guests have no savings, maxed out credit cards, no credit cards or Visa/MasterCard (logo) type pre-paid credit cards with limits as low as $250, etc.
Decades ago, while living in Japan as a student attending Sophia University, one of the first lessons I learned from a professor who taught statistical analysis was to be cautious and always scrutinize any data before coming to a final conclusion and/or interpretation. This week, analyzing the Bankrate.com report and other recently published data, I have heeded that advice!
Which leads me to back to the Bankrate.com study whereby their research suggests that 25% of all Americans basically have insufficient “emergency savings” stashed away and the Bankrate.com report also revealed that 28% of Americans have no (as in zero) savings at all.
But the ‘picture’ is actually a little gloomier because their data also disclosed that of those who do have a ‘reserve’ fund, so to speak, 22% of the respondents indicated their pittance(s) would only last up to 90 days and that would not cover ‘vacationing’ and/or a lavish or luxurious lifestyle to be sure.
Plus, according to Mr. Greg McBride, CFA and senior financial analyst for Bankrate.com: “Those most likely to have an adequate savings cushion are individuals in their 50s and 60s, and higher-income households,” adding, “But even among these groups, at least half do not have six months’ expenses in an emergency fund.”
The Bankrate.com findings and other recent reports clearly reveal that inflation has reared its ugly head, that American middle class purchasing power has plummeted, that home values are still tanking, that millions of home owners are ‘underwater’ on their mortgages, etc.
I can only draw one concise conclusion.
And that is simply that a notable percentage of today’s sales guests whom developers are paying to visit their sales centers have about as much business sitting through a timeshare sales presentation as they would walking into a Casino with their next paycheck and ‘rolling the dice’!
Draw your own conclusions from the economic realities of this decade. But these sales guests are consuming enormous resources (‘capital’) from developers and the prudent developers who understand this need to cease the absolute utterly wasteful ‘marketing’ (and sales) tactic of “never pre-judging” prospects and sales guests because ‘AN UP IS AN UP’!
First of all, and correct me if I’m wrong, but that decree (which is crap) is NEVER taught in the finer MBA curriculums at Harvard, Stanford, Columbia or Yale, etc. In fact, they teach just the opposite because they and the rest of the business community know that marketing and sales is ALL ABOUT prejudging the ‘market’, ‘market conditions’, ‘prospects’. You know, the demographics.
That very successful time-tested and proven approach by the way is EXACTLY why you’ll never see an AARP or Depends commercial advertised on MTV or Jersey Shore.
Yet, like other TS marketing and sales myths that are promulgated by those in the biz who gain from the status quo, that very special and all inclusive dictate about prospecting and sales guests (I.E. ‘an up is an up’) in this industry is still, in 2012, pretty much the ‘law of the land’.
For those developers who recognize the problem and want to adapt, a great place to begin would be to immediately stop touring all those single and/or cohabitating 25, 26, 27, 28, 29 + year old ‘kiddies’ earning (gross) $40-$50K annually because quite frankly, they aren’t buying (fill in your own adjective)!
In this group (“kiddies”) there are those who didn’t graduate from high-school (which I only point out regarding their earning capabilities); and then there are those college grads who now carry a combined debt in the Trillion Dollar neighborhood, which debt now surpasses all credit card debt combined nationally!
Of course if developers still want these sales guests and really aren’t in the ‘biz’ to sell full blown timeshare lifestyle interests, then shoot the old Scoop an e-mail and let me know because I have access to these kids and for $500 per ‘tour’ I’ll gladly flood your sales center with these youngsters until you’re drowning in them.
Email Scoop: email@example.com
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