April 3, 2015 — Who in our industry hasn’t observed a well trained and articulate professional timeshare sales rep who produces an average YTD net 40% CR with a high VPG — including near zero rescissions — and who does so by presenting the TS plan in an honest, sincere, entertaining and ethical manner at all times? Yes, there are those sales centers where the very essence of the rooms’ selling mode & atmosphere is not conducive for such professionals to excel (or exist at all), but in success-oriented, well managed sales centers where they can thrive the ‘rooms’ often have several 40% Super Stars working their wonders on those magical little round tables.
So Here’s The Scoop: I’ve said it before and I’ll say it again: Based on my and other Pro’s track records (STATS) spanning decades, when presenting a timeshare plan to a prospective buyer who has a need and can afford what they are previewing, etc. a positive minded, highly motivated & well trained career orientated sales professional will constantly close NLT 4 out of every 10 of those prospects – PERIOD!
Those in our industry who disagree with that reality do so for reasons I won’t go into too much today, but if the bottom line for any developer is making money (profits) — and it is — then why would they not do a little tweaking to increase their sales centers’ net YTD CRs as well as their VPGs?
After all, a net YTD 40% CR with an average TS contract price of $15,000 equates into that most prized of all ‘STATS’ in our industry — the VPG — in this example, of $6,000. And if the average contract price was $12-K the VPG would be $4,800. And if the average contract was just $10-K the VPG still comes in at a respectable $4,000.
A realistic net YTD VPG between $4,000 and $6,000? Now show me a developer who would not strive to reach those realistic & achievable numbers and I’ll show you a developer who refuses to be a ‘believer’ — and who is losing gobs of money!
Sadly, however, there is no shortage of sales centers (developers) in our worldwide industry doing just that, who are producing, IMPO, unacceptable net YTD CRs including VPGs way below $3,000 — some as low, I’ve discovered recently, as the unconscionable $1,600 neighborhood and even lower than that!
As we also all know, marketing is expensive. There are some developers who pay dearly to have a couple hundred thousand ‘tours’ each year visit their company sales centers and there are other developers whose reps only ‘greet & meet’ a few thousand sales guests annually. Either way, the losses are staggering for those developers producing subpar STATS.
Using 50,000 ‘Q’s’ annually as an example w/a 40% net YTD CR here’s the difference:
- $15-K average contract value = $300 Million in business = $6,000 VPG
- $12-K average contract value = $240 Million in business = $4,800 VPG
- 10-K average contract value = $200 Million in business = $4,000 VPG
Even if we cut that CR in half to 20% that still means those 50,000 ‘Q’s — at the low end average TS contract value of just $10-K — will still generate $100 Million in annual sales with a not so impressive YTD VPG of $2,000.
Yes, those subpar developers and the Exec staff at the top tier of the food chain are doing just fine, thank you very much, because even though they produce underperforming STATS it’s the massive quantity of their ‘tour flow’ that keeps them laughing all the way to the bank. But for the line peeps working in the trenches not all is so swell in the Land of Time & Money!
Developers’ CRs and VPGs are widely known and it especially boggles my mind how one developer in the same locale gleefully accepts a low CR and a VPG of (e.g.) $1,650 while their competitor down the very same beach is generating STATS two or three times higher. It just doesn’t make any business sense and shouldn’t be tolerated or acceptable!
Especially when you consider that most sales centers that are in the same marketplace are essentially marketing & selling the same basic (overall) product/service to the same demographic, which requires the same marketing and selling energy, time, skills and efforts, etc. for approximately the same dollars (costs) per sales guest.
And it’s not like achieving maximum sales efficiency in any sales center is some deep dark secret that involves demonic rituals, possession or the selling of one’s soul to get ‘er done.
Indeed, it can all begin with a simple change of the developers’ (and their management) mindset such as no longer holding those satanic notions that “An UP Is An UP” – “A Sale Is Made Every Time” – “Either You Sell Them Or They Sell You”, etc.
And then, once having told Satan to “Get thee behind me” it’s time to get down to the same marketing & sales practices, procedures, training, management style & policies, etc. that other developers incorporated long ago, which is how they achieve, in part, year in and year out such impressive STATS and their incredible success and wealth.
Oh well, it’s only money – mwahahahaha –
Good Luck Out There
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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’.