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Vacation-clubs: The Evolution of time share

By Gerard J.L.M. van Paassen

Vacation clubs, or time shares as they are known in Asia, were born out of the computer industry when IBM, in the early days of large computers, sold use of the computer in allocated times to universities, research foundations, hospitals and other institutions who could not then afford computers but needed to use their capabilities.

The first marketing of time shares is said to be by an enterprising French hotelier in the French Alps who launched the slogan: “No need to rent the room buy the hotel—it’s cheaper.” From there Americans took time share to heart in the 1970s when the Cold War between Russia and America made travel expensive, forcing a change in holiday habits.

The industry evolved from those early computer time shares into private aircraft, yachts and, eventually, into hotel like accommodation. The whole concept, from computers to hotels, makes perfect sense. Consequently, time share spread rapidly in Europe with some of the biggest hotel names, such as Ritz-Carlton, Four Seasons, Disney, Ramada, Hilton and Sheraton getting into the business. There are now over 5400 resorts in more than 100 countries with owners coming from over 270 countries, 45% from the United States.

In Phuket, Laguna Holiday Club [LHC]  is a leading company with 6000 members, of which 70% are Thai nationals, mainly from Bangkok. So it is big business with still a great deal of potential growth. The concept of acquiring a luxury holiday for families, in particular, where they have more space than generally not afforded in normal hotel accommodation, is very attractive.

So what is the future for vacation clubs in Asia, including Thailand?  We have come a long way from the early days where property developers and construction companies built vacation clubs for a quick profit and not the long term benefit of members. Today, the emphasis is on taking a long term view to ensure satisfied customers.

Of course, in such a big industry with so many variables, not every customer is going to be completely happy. We in the industry acknowledge this but, in Laguna Holiday Club’s case, being part of a large, publicly owned company, we place great emphasis on transparency and adhering to the prescribed rules and regulations laid down. In the future we see a situation where the industry in Thailand, and around South East Asia if not already in place, is self-regulated through an industry body.

In this regard discussions have already been held to establish a Thailand wide body which will enable the reputable industry players to impose strict standards that members must meet, and to work in conjunction with the relevant government authorities to ensure a high level of compliance and service.

This is a work in progress, but will happen. LHC has held discussions with Resort Condominiums International (RCI) and Interval International (II), two respected global vacation club organizations about an industry body. In the meantime companies like LHC work closely with the Thailand Office Of Consumer Protection [OCP] with whom we have an open and frank relationship.

Reputable vacation club owners have nothing to fear from consumer organizations. Indeed, we believe the OCP is an essential ingredient in ensuring the industry maintains standards and that redress is available where required. Self-regulation remains the best way of maintaining standards—indeed credibility—for any industry and the vacation club industry in Thailand and Asia is no exception.

In Europe and the United States there are strong self regulating organizations. Both continents have undergone an extensive revamping of the rules and regulations governing vacation clubs which has led to fewer outlets as the not-so-scrupulous ones fall by the wayside. This can only be a good trend that we in Asia should follow.

So this is the present and the immediate future for the vacation club industry in Thailand and Asia. Looking out over the next few years we see the industry evolving even further into an integrated time share global industry where it will be possible that points earned by members will be interchangeable and redeemable with other industries such as airlines, hire cars, cruising,   hotel units and even camping.

There will be no specific boundaries. In theory members would be able to use points to book accommodation at a five star resort one year, and go camping in a camper van the next. There will, if this scheme becomes reality, literally, be a gigantic pot of points for members to use across all these, and other, related industries. We foresee a time when a global governing body will be established to administer this integrated system.

In fact this integration is already taking place in the United States and Europe on a large scale and in some parts of Asia. But so far all of the various industries mentioned have not been interlocked into one giant global network. The key conduit in all of this would most probably be the points earned by vacation club members.

For Thailand and Asia such a prospect can only bring benefits. Asia remains the world’s fastest growing economic region with more and more citizens of countries like India and China, who previously were restricted in their travel and ability to invest, are leading the way. Asia also possesses some of the world’s most desirable destinations—Phuket in particular, and Thailand—being amongst them.

The challenge now is to continue the evolvement of the vacation club industry into this global village in a seamless and productive way.

This Op-Ed piece originally appeared in the Bangkok Post. Published on October 17, 2009.
Forum discussions are available on the publisher's website

Gerard J.L.M. van Paassen is Assistant Vice-President, Laguna Holiday Club at the Laguna Resorts & Hotels complex in Phuket, Thailand. 




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