A CEO panel at the ARDA conference discussed guest preferences, resales, exchanges, diversity and the state of the timeshare industry.

Like all developers, timeshare executives like to look on the bright side of things. That was the mood at the annual American Resort Development Association conference, which wrapped up yesterday in the timeshare capital of the world, Orlando. Despite the biggest downturn in the history of the 40-year-old vacation ownership industry, most speakers at the event chose to focus on what they believe is a rosier future for the business.

Despite what he called an “aggressive legislative assault on our industry from a taxation point of view,” James Lewis, outgoing ARDA Chairman and president of Disney Vacation Ownership, told the group, “we survived and are beginning to thrive. Today, the industry is more profitable than ever. Profit margins are up, as is return on invested capital.”

Lewis pointed to a number of positive signs that will drive the industry in the next few years. Many companies used the downturn as a time to conduct new customer research they’ll now be able to use to identify and market to new prospects. “I’m even beginning to hear about new development in the industry,” Lewis told the audience in his valedictory address. “I’m convinced the very best is yet to come for our business.”

There were more smiles on the faces of this year’s attendees at the ARDA conference.

Despite the cheerleading from Lewis, the vacation ownership industry is still in a deep hole. Industry sales for 2009 (the last year sales data are available) were $6.3 billion, down about 40% from the record high of $10.6 billion in 2007. Most attendees and speakers at the conference agreed sales were nearly flat last year, and only a slight increase is forecast for 2011. One positive sign: about 3,000 people attended this year’s ARDA conference, up nearly 1,000 from the 2010 event.

During a general session on Tuesday morning, executives from five of the largest timeshare companies chatted about a number of important topics—owner preferences, resales, the importance of exchanges and the need for greater diversity in the industry—but not how they plan to return to the not-so-distant era when the timeshare industry routinely posted double-digit annual increases in sales.

Even though traditional interval sales still account for a majority of timeshare sales (55% in 2009), points-based programs were a hot topic among the CEOs. Most agreed points will be the future of vacation ownership, and Steve Weisz of Marriott Vacation Club believes the key is choice. Marriott, which recently introduced a points option, gives legacy owners the opportunity to convert to points or remain with their deeded products. “While it’s not mandatory, we’re seeing our existing owners signing up for points at a higher pace than we anticipated,” he said.

“We need to move to meet the needs of the next generation of owners if we hope to remain relevant,” added Mark Wang, president of Hilton Grand Vacations, “and for some that means the flexibility of points.”

The ability for owners to exchange has always been a key marketing tool for timeshare companies, and the panel agreed it will be even more important in the future. As Don Harrill, president & CEO of Holiday Inn Club Vacations and incoming chairman of ARDA, put it, “The timeshare experience is all about customer value, and exchange has always been a big part of it.”

Added Franz Hanning, president & CEO of Wyndham Vacation Ownership: “Travelers are more adventuresome than ever, so exchange will become an even more important tool for us and them.”

As the timeshare industry’s key annual event, the ARDA conference is the setting for many industry announcements, particularly from the two leading exchange companies. Here’s the news RCI and Interval International generated this week at the conference:

• For RCI, most of the news centered on technology. The Wyndham Worldwide unit debuted two apps for the iPad and two new features for its existing iPhone app. The iPhone enhancements allow subscribing members access to the RCI directory and member account alerts. RCI offers all the iPhone features on the iPad but with the advantage of a larger screen to view photos and videos from RCI TV.

“For many years, timeshare was a one-way marketing stream through such strategies as OPCs (off-premise contact),” said RCI CEO Geoff Ballotti in an interview on the ARDA trade show floor. “Today that’s changed, and due to these kinds of technology, owners and potential owners can search for their vacations through platforms like RCI TV.”

2010 was a big year for RCI, as it added more than 100 newly affiliated resorts and renewed relationships with existing affiliates such as Disney, Hilton and Bluegreen. Its Registry Collection luxury exchange arm affiliated 20 new properties last year.

• Interval International used the ARDA convention to celebrate its 35^th year in business as an exchange company and servicer to affiliated resorts. The company has more than 2,600 affiliated properties in 75-plus countries and more than two million member families.

It also introduced Club Interval Gold, a new points-based exchange service for owners of fixed- or floating-week timeshares. The new program allows these owners to convert their vacation time into points they can use to make standard exchanges, shorter (two to six nights) exchanges, combine deposits to trade up to better units or higher-season vacations or to apply points for a cruise or golf or spa vacation.