September 28, 2012 — A sobering truth rarely admitted in our industry is that sales professionals seldom strike out (aka: ‘blank’) when they are with a prospect who ultimately ‘likes’, has the ‘need’ and can actually ‘use’ & ‘afford’ a timeshare ownership plan. Yet industry wide upwards of 85% of all sales guests choose not to become owners/members.
So here’s the scoop. Most readers may not be familiar with ‘The Pareto principle’ but many in our industry are aware of its other name which is the 80-20 rule whereby in sales it is believed that 80% of the company’s sales contracts are generated by 20% of their sales staff; or that 80% of the company’s sales originate from 20% of a given market.
I would not agree with the exact ratio but I do agree with the basic formula. And I would add that a primary goal of any timeshare marketing and sales effort should be what I’ll call ‘Scoops 50/50 split’ whereby a more qualified sales rep meets a more qualified sales guest which, when this occurs, always results in higher closing ratios, VPG’s, lower rescissions and increased profitability, etc.
In our industry we have, without question, some of the most talented marketing & sales pros there are. Yet when I look at both ‘teams’ independently, across the board, the 80-20 rule seems to apply in reverse whereby upwards of 80% of these fine folks are basically just warm bodies as opposed to being world-class professional sales and/or marketing ‘Stars’.
I would also argue that the same is true with sales guests and that upwards of 80% of all timeshare prospects shouldn’t be on ‘tour’ in the first place. The proof therein is that even the top producers in our industry can’t close the lion’s share (more than 50%) of the sales guests they meet.
And that happens because at the end of the day, when the real sales pros do ‘blank’ it is almost always during the ‘closing’ sequence when they find themselves dealing with a prospect who, most often, has a financial or lifestyle issue that prevents them from becoming owners.
Sadly, from a marketing and sales perspective we are the proverbial tail wagging the dog. The entire industry is held hostage by the marketing ‘entities’ that are paid handsomely for ‘snagging’ (e.g.) a very young renter with a secured credit card living in a sparsely furnished studio apartment, working two part time jobs and living with their significant other, all the while claiming to have the gross (before taxes, living expenses) income required to be ‘qualified’ in order to accept the bribe (inducement) and visit the sales center.
And therein is the first rub as the marketing entities are paid the exact same amount for that prospect as they are for a (e.g.) married couple of 25 years, homeowners, empty-nesters with a household income of $125-K, ‘Platinum’ credit cards, savings & investments, etc. and who indeed travel globally 2-8 weeks every year including weekend getaways, take cruises and so forth.
Which leads to the second rub, which is that all too often the latter sales guest is met by a recently converted (e.g.) furniture mover or fry-cook turned timeshare rep who simply goes through the motions with a ‘canned’ pitch and then introduces the ‘Gold-Ball’ couple to a less than stellar closer.
In a nutshell our industry’s marketing & sales ‘A’ game is akin to a deadly game of Russian roulette in that the developers load only one round in a six cylinder revolver, give it a spin and when that stops rolling they order the pulling of the trigger and in either case (Russian Roulette or Timeshare sales) 16.6% of the time the ‘bullet’ will strike its victim, so to speak.
Obviously timeshare marketing and sales is not as serious as Russian roulette. But as long as most developers remain fixated on the mass hiring and touring of ‘warm-bodies’ methodology they will continue producing the same results; and although those are profitable, developers are losing untold millions of dollars in sales by their antiquated and ineffective system.
If, on the other hand, developers only hired top-flight low-maintenance successful marketing and sales professionals with a proven track record and then loaded the ‘cylinder’ (aka: sales line) with quality sales guests of a suitable caliber for what is being ‘sold’ the sales volume would be as dearly embraced by the developers as it would be by the ‘marketers’ and ‘reps’.
I’m not going to hold my breath for that to happen and even though the sales results would be immediate and achieved without a one-cent increase in operational overhead, and to do so is a’ no-brainer’, most developers will continue to play Russian roulette – timeshare style.
To send tips, comments, suggestions, agree and/or disagreements etc. email Scoop: firstname.lastname@example.org
Contributing sometimes extravagant, bombastic, emotional, pompous or even pretentious writings about the timeshare industry, Scoop covers an array of industry related subjects each week including inside information, tips, scandals, interviews, forecasts as well as new (good or bad) products and services--- and, of course, all the 'Good', the 'Bad' and the 'Ugly'.
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