posted by Desties on Feb 24
It wasn’t the way that the club drew things up, but shares of Ultimate Escapes were delisted after the country’s second largest destination club was unsuccessful in completing its secondary offering.
The club marches on, including a new ticker symbol — ULEI — on the OTC Bulletin Board.
Delisting obviously isn’t fatal, and it certainly isn’t permanent. However, the club will have to rethink its plans now that it no longer can count on the money it was expecting to raise during the offering.
2010 was supposed to be a turnaround year for the industry, but it still seems to be feeling its way along the bottom.
posted by Desties on Sep 9
One of the more intriguing pitches behind the reverse IPO in the works at Ultimate Escapes is that the club plans to eventually offer an equity club and a points-based system.
Am I the only thinking that this can all be interchangeable? UE is already three distinct clubs, with reciprocity between them.
Why can’t UE launch an equity club that allows travel between the equity club and the three existing UE clubs? It would make it an easier sell in the beginning, so it can add new wholly-owned properties at the dictated membership growth pace, yet still offer the portfolio of Premiere, Signature, and Elite for immediate travel? The three non-equity club members can also benefit from the equity additions through similar reciprocity.
A points-based club can also be used as an overlay. I imagine that a points-based club may be a more value-conscious offering, but it too could benefit from having well over a hundred properties at its disposal from the beginning.
There may be some legal loopholes to make it all happen, but it would be an easy way for UE to scale quickly. There are only a handful of players in the equity niche. Abercrombie & Kent is the leader. Equity Estates is the hungry secondary player. Clearly there is room for yet another meaty foe, so why Ultimate Escapes? And why not sooner rather than later?
posted by Desties on Apr 28
Timeshare watchers will remember how the industry was obscure and shady until the major hoteliers like Disney and Marriott came threw their hats into the ring. Is the destination club industry now being upsized?
Ritz-Carlton finally announced its entry into the market.
The Ritz-Carlton Destination Club is an equity-based luxury travel program where Members select either a Home Club Membership which provides a titled residence and usage at a property they can return to every year, or a deeded Portfolio Membership which affords the opportunity to discover a wide variety of locations and experiences.
In other words, it’s not a pure destination club as it borrows liberally from destination clubs, fractional residence clubs, and timeshares to arrive at its product. It will be the point-based — like Disney Vacation Club. It will offer deeds — like many timeshares. It will offer equity — like Abercrombie & Kent on the DC side.
If history is any kind of teacher, existing clubs may tweak their models to fall into what the public will now expect destination clubs to be and offer. What remains to be seen is if Ritz-Carlton will go on a shopping spree, to quickly build up its critical mass before someone else does. It would also help Ritz-Carlton acquire some homes, since at the moment its portfolio appears to consist mostly of Ritz-Carlton resorts and retreats. That may work for hotel and timeshare buffs, but the thousands of existing destination club members expect larger stand-alone properties that are truly unique and can’t be booked without joining.
Learn more about the Ritz-Carlton Destination Club here.
posted by Desties on Mar 21
The past few months have been rough for the destination club industry, with Lusso, High Country Club, and now Solstice filing for varying levels of bankruptcy. Other clubs are also smarting with higher dues or financial assessments.
How’s the spouse? I’m asking only because the allure of destination clubs comes mostly from the availability of large, luxury vacation properties. Nearly all destination club members are likely married or living with someone special, many with families to take along on the unforgettable treks that clubs — at their best — can offer.
So, I have to ask again — how is that special someone in your life coping if you happen to be a member in one of the languishing or obliterated clubs? It’s not an easy question because odds are that you both didn’t arrive at the destination concept on independently. One of you probably read about it in a magazine, newspaper, or blog — or maybe you saw an online ad — and checked it out before suggesting it to your spouse.
If so, and your club has gone under, make sure you don’t play the blame game or your relationship may go bankrupt too. Financial concerns can be a marriage killer, so it’s important to accept that mistakes are made. You weren’t the only one to join your club. Others came to the same conclusion after their own due diligence. As long as you can survive the shorfall without pointing fingers, I see great vacations in your future.
posted by Desties on Jan 21
These are lean times in the destination club industry. Weaker clubs have resorted to hiking dues, doling out assessments, or filing for reorganization. I won’t address the problems ailing the industry given the one-two punch of falling real estate prices and a dearth of new member signups. This time, I’m all about solutions.
Clubs can do a better job of monetizing their properties and broadening their brand awareness. I have several suggestions. Some may be outlandish, but there is a grain of logic even in the more far-fetched ideas I’m presenting today.
See if you agree or disagree.
1. Go Hollywood - Destination clubs have amazing homes in amazing locations. It’s just the stuff that movie and commercial shoots need. Major studios pay thousands a day for the right to film in high-end properties with clauses to fix anything that is damaged in the shoot. Clubs should be all over this, especially when it comes to the lull in seasonal properties. Even if a last-minute shoot overlaps with member stays, it would be cheaper to relocate the member to perhaps a superior short-term rental than to go without the film production money.
2. Enroll the homes in luxury vacation rental sites or launch a separate club-owned site, to fill short-term openings - No one likes to see third party guests dish out wear and tear on a club home, but a dormant property is even worse. High-end travelers looking for last-minute getaways can generate incremental revenue and also be prime candidates for new memberships.
3. Reality Television - Travel Channel, HGTV, and perhaps even the Golf Channel would probably eat up a DC-driven reality television show. “Local Host” can follow a different property host every week as he or she goes about interacting with house guests, setting up concierge services, and coping with the daily grind of pampering. The show would do several things like generating brand awareness for the club and also creating interest in potential local host hires. A more direct cable channel show could be an industry-backed “Destination Clubs” show that profiles different clubs in an entertaining manner without coming off as an infomercial.
4. Get aggressive with affiliate programs - Online lead referral sites like Commission Junction and LinkShare offer cost-effective ways to generate leads beyond the obvious Google AdSense approach. They reach a wider audience, but are action-based instead of simply click-based, so It can be useful in promoting entry-level trial plans and offerings without breaking the bank. Working with real estate professionals as some clubs have is a good low-risk move, but this moves the challenge to travel site webmasters and travel bloggers who really now how to promote a product and have more street cred.
Oh, I have far more than four ways, but I’ll leave it here for now.