Veterans Must Adapt Quickly to DisruptionWed, 11/01/2017 - 13:07
As technology enables more and more disruptive companies to enter the market, veterans like RCI need to rapidly adapt to these changes, says Ricardo Montaudon, the timeshare company’s President and Executive Director for Latin America. “Instead of acting as developers, these companies are becoming a distribution chain offering a different experience from ours,” he says.
But he is not overly worried that these changes will endanger traditional timeshare developers. “Disruptors will keep coming but I believe that the market will also continue growing and changing,” he says. “Millennials may be millennials today, requiring alternative solutions that fit with their lifestyles, but in a few years, they will get married, have children and their needs will change.”
RCI offers an array of experiences that includes national and international destinations, cruise and tour exchanges through the use of an exchange program. The system depends on a fee paid by enrolled hotels, which covers inspections and marketing materials. Member hotels then pay RCI based on the number of visitors and sales made.
However, for the exchange program to function, Montaudon says that a number of factors must be taken into consideration, including the destination and the hotel development and quality. While it is easy to select destinations such as Cancun or Los Cabos, other destinations might not be as obvious. For Montaudon, the important thing is to select a destination that has an important inflow of visitors, so it can generate new enrollments and exchanges. The other important factor to consider is related to the legal details surrounding properties. “We can only affiliate developers and not marketers, since the latter do not have any real rights over the development,” he says. “But the marketers are a key component of the developer’s success.” Even though the appearance of new players will not jeopardize RCI’s business, Montaudon says that the only way hotel developers will be able to compete effectively with disruptors is through the creation of new and unique experiences. “It is a matter of having a product that people want to buy,” he says.
When it comes to offering one-of-a-kind experiences, Grupo Vidanta, RCI’s largest developer in Latin America, is taking the lead with a new project in Nuevo Vallarta. The project includes a theme park estimated to open in 2018 and will feature the first ever Cirque du Soleil theme park. Choosing Nuevo Vallarta as a destination was no coincidence. In 2015, the city received over 2.5 million tourists and this inflow is estimated to double in the next five to 10 years. Montaudon notes that these types of projects are key to ensure a flow of tourists. “We are seeing a transformation. The beach is no longer the destination but a complement.”