Alternate Exchange: It’s No Longer Just Coke or Pepsi

The timeshare exchange market, with its two dominant players, used to be compared to Coke vs Pepsi and McDonald’s vs Burger King. Today, the former rivalry is still going strong, while the latter has become more fractured, with players such as Subway, Chipotle and Taco Bell. Timeshare, in this analogy, has gone the way of the fast-food industry, with DAE, RTX, Hawaii Time Share Exchange (HTSE) and several others making significant inroads.

A relative newcomer, HTSE (htse.net) started in late 2000 as an in-house exchange company at Lawai Beach Resort. Owners at the Kauai resort were complaining about not being able to exchange back in to their home resort using other exchange companies. HTSE has since grown significantly: “Besides offices on Kauai and Oahu, we just opened our new location in Seattle,” notes Sonya Halladay, operations manager at HTSE.

After years of hearing about timeshare owners’ concerns and challenges with exchange companies, the founders of Asheville, North Carolina-headquartered (rtx.travel) RTX believed they could approach the exchange model with a focus on the customer service perspective while providing benefits for partners as well as profits for their company. “This started with RTX creating a simple, affordable and flexible exchange platform,” says Justin Hunter, vice president of operations, “and has evolved over the years into RTX providing a wide range of travel services and benefits beyond exchange, while also serving as a partner for resorts and HOAs that can help with all aspects of owner services as well as renting excess inventory.”

DAE (daelive.com) formed in Australia in 1997. “The two well-established exchange organizations held over 90% of the market share in our country,” explains Francis Taylor, CEO. “We started DAE to provide an extra layer of choice for resorts and consumers when it came to exchange services. The DAE business model was very different to that of our ‘big brothers’ — we operated a low cost business, simple, open, easy to understand and we placed the highest value on servicing our members. We offered free membership, where our members told us where they wanted to exchange to first without the need to deposit their week or pay any money before we could help them.” Today DAE operates from 10 offices around the world and services more than 1.5 million members.

What differentiates the companies?

“More than anything I think it’s the DAE culture,” Taylor says. “We focus on our core business: exchange. So the majority of all our time and effort goes into sourcing and matching our member’s exchange requests to inventory and vacation experiences.”

Hunter points out that RTX continues to offer among the lowest exchange fees in the industry. “Our $117 exchange fee covers domestic and international travel whether booked online or by phone, for all of our members,” he points out. “RTX also offers the longest deposit life in the industry, up to 4 years (48 months) for our highest membership level. And for our higher level members, we perform custom searches to ensure the best match for their requested accommodations.”
And echoing customer-care sentiments from DAE and RTX, Halladay notes that at HTSE they “strive for personalized service and helping owners get the best possible use of their timeshare week.”

Does it best serve timeshare owners to use more than one exchange company?

The consensus answer to that question among alternate exchange companies seems to be yes.

“It makes sense for members to try out several exchange companies to see who has the best options for their vacation needs,” Hunter says. “We do explain to many members that each exchange company is different,” adds Halladay. “And we encourage owners to join other companies if we feel we cannot meet their needs.”

“Consumers have to remember that each provider have their own strengths and weaknesses,” Taylor states. “To get the very best chance of obtaining the exchange they want, they need to place their exchange requests on a wider front.”

How much does size matter?

“I feel that size does not matter and it is instead all about supply and demand,” Halladay observes. “It is very important to us to confirm each members exchange requests and to not burn inventory.”

“Size is something that can work for you in some circumstances and against you in others,” Taylor adds.

Hunter sums it all up, saying: “While larger companies have long dominated timeshare exchange, the landscape is changing just as it has in the timeshare industry as a whole. While larger companies may admittedly have better technology and more resorts in their directories, owners, resorts and HOAs are starting to look beyond those qualities to actively seek smaller companies whose customer service level, flexibility and affordability are top priorities.”

It’s clear that the days of there being only two exchange companies are now past. And it looks like that in the timeshare industry’s version of the Cola Wars, consumers are the real winners – as more choice and more options translate into more happy endings for exchange requests.

C.A.R.E.: The Original “Alternate Exchange” Organization Today Helps Keep Inventory Within the Industry

What would eventually become the nonprofit Cooperative Association of Resort Exchangers (C.A.R.E.) was formed by a few individuals in the owner services departments of a handful of resorts in 1985. Their intent was to provide additional services to vacation owners whose needs were not being satisfied by their exchange company. These owners had expressed dissatisfaction or frustration in not being able to get the exchanges they had wanted – and working directly resort to resort, C.A.R.E.’s founders were able to help many owners get the vacations they desired. “So we basically had a happy owner rather than an upset one,” says Linda Mayhugh, C.A.R.E. president.

While not an exchange company, throughout its exchange-based development, C.A.R.E. has ultimately evolved into an educational networking platform where industry professionals learn about where to find – and how to move – inventory outside of the exchange companies in a positive and total industry-respected manner,” Mayhugh states.

C.A.R.E. is more relevant today than ever because of the ever-changing picture of the inventory on the market, says Mayhugh. “There is so much inventory out there from so many different sources.” She adds that C.A.R.E. provides an important platform for its members – like resorts, HOAs, travel clubs and management companies – that either need inventory or have inventory to move. What’s more, C.A.R.E. helps to keep inventory within the timeshare and travel club business rather than out into the retail market. C.A.R.E. does this not as a replacement of major exchange companies, but rather to enhance the levels of service and varied product offerings that owners and members demand.