Like all segments of the hospitality industry, timeshare has its challenges, but the $10-billion industry should have another solid year of sales growth and wider acceptance by the U.S. consumer.

“Timeshare has enjoyed double-digit growth for the past decade and a half, and I don't expect it to be any different in 2005,” says Howard Nusbaum, the dynamic president and CEO of the American Resort Development Association, the timeshare industry trade group. “We had some roadblocks last year, such as the hurricanes that disrupted many of our properties and their sales cycles, but timeshare is an industry that's very adept at meeting challenges.”

Nusbaum says recently enacted do-not-call regulations are forcing timeshare developers and marketers to devise new methods to generate sales leads. “In time, we'll look at DNC as the best thing that has happened to our business,” he says. “As developers explore new marketing methods, they're finding that even though lead generation is now more difficult and more expensive, the prospects are better qualified and conversion rates are higher.”

In ‘05, Nusbaum predicts even more hotel companies will embrace timeshare and more new resorts will be multi-use projects of which timeshare is one component. He has some concerns about the rapid emergence of non-equity club products in the marketplace. (Former AOL founder Steve Case is a principal in Exclusive Resorts, and veteran lodging executive Scott Anderson heads up Dream Catcher.)

“One of the reasons timeshare has been so successful is the legal and regulatory safeguards that guarantee that projects will be built and that there is total transparency in the process,” says Nusbaum. “At this point, it concerns me that the club concept is growing so rapidly but without any regulatory oversight.”

Other, more familiar challenges remain for the industry, says Nusbaum. “We still need to educate consumers that timeshare is the best way to take a vacation. Many people love the product but hate the purchase process. Ultimately, the Internet will be our best friend in overcoming this issue.”

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