Timeshare Laws for Marketing + Advertising

the regulations of vacation ownership marketing and advertising through timeshare laws and consumer protections programs

Over the years, the timeshare industry has transformed into a hospitality giant since it burst onto the scene in the 1960’s. Now that we’ve shared a solid overview on the history of timeshare ownership, let’s talk about some of the laws and regulations that hold the concept together. Although a number of initiatives, revelations and scams have shaped the industry into what it is today, timesharing is still a wild wild west of sorts.

Leading up to 2019, it’s been fairly difficult for programs and agencies to put a halt to unethical practices and the deceit within the industry. But it doesn’t mean society hasn’t progressed. It simply means greed is clouding the judgement of major stakeholders. Businesses fixated on revenue seem to always find a way around laws when the reward is worthwhile.

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A declining market share also adds a little incentive maximizing profits. If you’ve been following along lately, then you’re well aware of the financial rewards that can come with timeshare sales. The problem is, a big percentage of timeshare revenue is at the consumer’s expense. And most likely on purchases that aren’t really necessary.

With developmental expansion slowing down and major hospitality players slowly taking over, it seems like a more systematic approach is in order for the timeshare industry. As the dust continues to settle, a good portion of sales processes and marketing initiatives are becoming more regulated. The tactics that have allowed timeshares to thrive throughout history are now common knowledge because of the internet. Consumers are able to make more informed decisions now than ever before.

Timesharing is Prime For Competition.

Although progress has been made, it doesn’t mean standardizations will eliminate consumer problems. There are plenty of ways to improve which is why vacation rentals and travel clubs are increasing in popularity. Until the people are able to completely trust the timeshare pitch again, we can’t expect an industry rejuvenation. Although outlook has been dim before, consumers aren’t as gullible as they once were.

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The access to information is eliminating impulse purchases altogether. Because people want to know about timeshares, we want to help them understand what they’re getting themselves into. It’s not just about helping timeshare owners get out of their agreements. With that being said, let’s take a look at some of the timeshare laws and regulations that have been able to keep resorts and predatory agencies at bay for the most part.

Timeshare Regulations for Marketing and Advertising

Before we talk about the aggressive sales tactics used by timeshare companies and resorts, we have to point out the role that marketing and advertising plays. Before most consumers arrive at the sales presentation, they’ve more than likely already been briefed on what to expect from the experience. In some cases, they might already be eager to sign the dotted line. Making an impulse buy with confidence typically means the marketing has done its job. What’s bothersome is that many timeshare companies know exactly what to say to get people in the door. If they can get you to arrive with minimal questions, they know it’s pretty much a done deal.

The Difficulty of Regulating Advertising or Misspeak.

Like other industries, advertising strategies don’t necessarily tell you the full truth. Trigger words and vague phrases are often used to manipulate consumers into believing the product is better than what it really is. Call it a mirage if you will. For example, food (especially produce) can market products with “organically grown” on the packaging. But it doesn’t necessarily mean their definition matches yours. Legitimizing phrases like “more fresh” or “healthier” is nearly impossible when you’re unaware of the actual standards of the term. When you think about it, it’s pretty difficult to define this type of verbiage anyways.

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How Marketing and Sales Work Together

The same can be said for timeshare marketing strategies. More often than not, consumers are distracted by free gifts and potential instead of focusing on what the purchase is or can be. Timeshare companies know to hype prospects up while intentionally leaving out the details on drawbacks (availability, annual fees, perpetuity, taxes and resale value). The excitement of something they’ve been persuaded to believe in can easily overshadow the actualities of the deal. Call it false advertising if you must. Consumers deserve to be protected from this.

At the same time, it’s very difficult for misled timeshare owners to find restitution in court. In order to penalize an entity for misleading marketing tactics, one has to be able to prove they’ve been lied to. Some lawsuits have won, but only after a lengthy battle with an experienced legal team. While it’ll always be difficult to regulate hearsay when contractual agreements are involved, there is now a strong push to protect consumers from major purchase decisions like this. The best way to combat marketing misconduct is to educate consumers on the front end.

The Legalities and Laws of Marketing and Sales

Aside from public information like this article, nearly every state now has its own marketing and advertising regulations with the FTC, FCC, consumer protection agencies and other state sales statutes. While regulations may never stop unethical companies from breaking the law, at least there are now some consequences in place. Since tourism is more prevalent in certain parts of the country, some states need to have laws that are a little more strict than others. For example, California actually has its own advertising requirements.

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While it’s good to see organizations keep an eye on an industry that can get out of hand quickly, we know it’s not the end all be all. With the internet still emerging, it’s only a matter of time before new regulations are implemented and reinforced. This is a tall order because the world wide web is still basically unregulated. Since regulations have increased marketing costs for timeshare companies, new acquisition is harder to come by. At the same time, it’s caused resorts to target their current fractional owners more aggressively to make up for the loss.

Combating Misleading Timeshare Marketing Tactics

Once you’re locked into timeshare ownership, not all hope is lost. If you feel as though you continue to be lied to, then you have every right to build a case for yourself. The timeshare industry uses a lot of 3rd party advertisers to re-market to their users. Understanding what they’re allowed to market will help you pinpoint unethical behavior and get out of your contract sooner than later.

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It will be interesting to see what evolves in the next few years to combat the extensive amount of fraudulent activity online. In the meantime, do your best to thoroughly understand major purchases and the rights you have as a consumer. There are plenty of things to look for and ask when attending a timeshare presentation. At the end of the day, doing your due diligence and understanding common timeshare marketing misspeak can save you a lot of grief in the long run. 

To continue reading about Timeshare Laws, click part 2 below. If you’d like to learn more about our timeshare cancellation company, we’d love to hear from you! For those interested in learning how we can help you find relief, feel free to submit a qualification form.

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Written by the top Real Estate Litigators in the Timeshare Industry.