Timeshare & Technology: Revisiting the Technology “Sacred Cow” Ten Years Later

by Simon Crawford-Welch, Ph.D., RRP
Executive Vice President, Sales & Marketing
Shell Vacations Club

Just over a decade ago, I published an article in ARDA’s “Developments” entitled “Scared Cows Make the Best Burgers: Breaking the Sales & Marketing Stranglehold”. The story described outdated business beliefs, assumptions, practices, policies, systems or strategies that inhibited change and prevented responsiveness to new opportunities in the vacation ownership industry.

At the time, these herds of “sacred cows” were grazing on our profits and choking productivity. They were old, mildewed, obsolete ideas that no longer worked in a business climate that demanded cutting-edge thinking and bold, imaginative solutions. But we refused to recognize that they needed to be put out to pasture.

One such “sacred cow” was the techno-phobic sacred cow where conventional wisdom at the time was that vacation ownership was a people business with no room for technology. Ten years later, we recognize this belief was clearly misplaced. Most of today’s developers acknowledge that technological advances continue to provide breakthroughs with dramatic impacts to the bottom line.

Gone are the days of mass shotgun-like marketing programs and “one-sales-presentation-fits all” approach to sales. Today, technology, and sophisticated data capturing programs are increasing at lightening speed paving the way for advances in sales and marketing we couldn’t even dream about a decade ago.

The examples below show how technology has significantly impacted the operations of Shell Vacations, LLC, one of the nation’s most respected independent vacation ownership developers. With 23 resorts in seven states, Mexico and Canada, 2,227 employees and gross annual revenues in 2006 of $388.4 million, Shell Vacations is operator of the innovative and flexible point-based vacation club known as Shell Vacations Club (SVC).

Technology & Sales
As part of SVC’s overall strategy of sales standardization, we strive to have a touch screen interactive sales presentation (ISP) on every sales table throughout the company. The ISP consists of over 80 screens based around a 12-step sales presentation and enables us to create a customized presentation for each guest. The unlimited number of product configurations we can create using the ISP enables to sell as many different products as there are customers. This is, in essence, mass customization.

Technology has also enabled us to standardize sales prices, first-day incentives, anti-rescission programs, and points packages. This is no easy task when SVC points can now be used for over one million different benefits ranging from accommodations, air fare, car rental, cruises, restaurants, American Express Playdeck Cards, Costco memberships, spas, golfing and a long list of entertainment and activities.

Internally, each ISP screen is tracked with data for both sales and non-sales, stored in a data warehouse. Individual sales agent’s performances are benchmarked throughout the company. SVC is able to empirically measure what a sale “looks” like in terms of screen usage compared to a non-sale. Training is then developed around this “anatomy of a good sale” and SVC is able to develop what is essentially a statistically proven “trail to the sale”.

Technology & Compliance
Perhaps no other area has benefited from technology in recent years than compliance. Sophisticated programs allow us to scrub telemarketing lists against company, state and federal do-not-call lists on an “as required” basis. SVC also provides this service for contracted vendors who pass its rigorous compliance certification process. The company is able to track which vendors scrub against the list. This technology is combined with proprietary databases that sort leads by designated type. For example, those leads whose Express Written Permission (“EWP”) or Established Business Relationship (“EBR”) period is encroaching on the regulated time limit to call, are sorted and used in priority of their “shelve life”

Technology and Telemarketing
When the Do Not Call (“DNC”) list became reality in 2003, most companies did not have DNC lists and were not scrubbing. In 2004, there was a mass migration to pre-recorded technology in an attempt to maintain old marketing and sales paradigms. Around 2005, the industry saw a decline in less than reputable operators as developers began to more aggressively target their marketing to the more efficient existing owner lists, almost to the point of cannibalization. Last year, 2006, saw a migration toward electronic, print and standard mail campaigns to drive inbound call centers. These included large scale internet campaigns to drive inbound call centers.

Technology & Customer Satisfaction
SVC uses web-based electronic surveys to measure satisfaction ratings for both purchasers and non-purchasers. These tools, combined with more traditional tools such as blind-shopping reports allow the company to have a real-time grasp on any customer satisfaction issues before they develop into a trend, allowing us to be proactive, rather than reactive.

Technology & Marketing
Technology enables us to review every single piece of sales and marketing collateral materials. The legal team reviews them for compliance, and the marketing team for brand conformity. Each collateral piece is then assigned a barcode before being deployed to the field, and is the bar code is stored in a web-based centralized electronic library. This enables us to ensure that all marketing materials are company sanctioned and meet the increasingly stringent regulatory State environments. All interactions with the SVC Marketing Resource Center are recorded electronically allowing us to know who is doing what and when. Essentially, the site creates a centralized database that serves both operational and legal needs.

Exploding Internet technology has resulted in the increase of On-line Booking Engines (OBE), providing services to existing members as well as generating qualified mini-vacs and cost effective programs that targeting tour-no-buys with various e-mail campaigns.

Technology & Training
Like many large industry organizations, SVC faces multiple challenges in training its sales and marketing team members … especially when they are spread over four times zones in different cities, states and countries. Our intention is to retain some level of company-wide standardized training while still incorporating regional and local idiosyncrasies. To provide a training structure customized to the individual as opposed to “mass” training, SVC developed an on-line, web-based training site called the “SVC Resource Center”. It is personalized for every sales agent company-wide and allows the company to perform monthly and quarterly testing.

Technology & Inventory Optimization / Monetization
SVC is a product grounded in real estate, so when a SVC member uses their points for anything other than SVC resort accommodations, these “external benefits" cost money. SVC pays for those benefits by renting room inventory, available because the points associated with it are being used for members’ external benefits. This process is known as “monetization” (converting unused inventory into revenue). With thousands of members using external benefits, the challenge to pay for these benefits grows incrementally on a daily basis.

To help in manage the monetization process, SVC made a significant capital investment by purchasing another high-tech software system, Top Line Profit Enterprises (TLPE), which supports inventory optimization efforts by applying usage rules equitably across all company properties. Every property has also been installed with “Opera by MICROS”, the largest hotel property management system in the world as the systems combine and work to achieve 100% utilization of available room nights, achieving the highest yield per point for each room night.

Through the use of various forecasting tools, SVC identifies emerging trends or changes in inventory usage and alerts revenue managers at each site who create promotions to drive occupancy. Once the use of external points for benefits is forecasted, Shell Vacations Hospitality targets these points for rental. With a better understanding of the collective monetization goals, SVC can now drive higher room utilization at a lower room rate and still have a sufficient yield per point to cover the cost of the Club’s external benefits.

Technology & The Future
Shell Vacations has recently pumped up its web marketing efforts to optimize online distribution channels, resulting in increases in revenues from rental bookings. Some of the statistics behind this revenue surge are directly attributable to consumers who have also now clearly jumped on the technology bandwagon.

The online travel market is expected to grow from 14% back in 2002, to 38% in 2007 and a whopping 46% predicted for 2010. In 2005, over 25% of all US hospitality revenues were generated from the internet. Industry researchers estimate that today – just two years later -- 55% of all internet hospitality bookings are made directly between the consumer and the hotel/resort property. In many ways these statistics are symbolic of how technology is affecting and changing the lives of both consumers and businesses.

The world is clearly becoming wired to technology and only the companies who understand this and remain on the cutting edge will survive. Shell Vacations intends to do just that, utilizing every technological opportunity to help train, market, sell and manage our vacation ownership product. Tomorrow’s technology will also enable us to remain in constant communication with our members and thus continue to provide the quality of service and product they have enjoyed in the past.