Fast forward to 1998. The Dow-Jones is over 8000. "Dallas" appears globally in syndication. And Ragatz, now executive vice president of RCI Consulting, has released the 20th Anniversary edition of what has become the benchmark timeshare-consumer study, Timeshare Owners: Who They Are, Why They Buy.

"While society has changed over the past 20 years, the timeshare industry has changed even more," Ragatz says. "Our industry has left its humble beginnings as a way to dispose of excess condominium inventory to become a mainstream consumer product."

The recently released study examines the 1998 U.S. timeshare market, particularly owner demographics, product use, owner satisfaction and purchase motivations. In the study, Ragatz identifies four major timeshare trends: rapid growth, upper-income consumers, seniors and singles.

Rapid growth

Since 1978, annual U.S. sales volume has grown from less than $300 million to almost $3 billion. The number of U.S. timeshare resorts has increased from 240 to more than 2,000. And the number of U.S. households owning timesharing has increased from less than 100,000 to 1.9 million.

This growth will only continue, Ragatz says. "One and a half million more households are likely to own timesharing in the next few years. The U.S. market will grow to a 10 percent penetration rate among households with an income of more than $50,000, from its current 4 percent rate." Adding 1.5 million new owners to today's 1.92 million owners would result in 3.42 million U.S. timeshare owners. The increased consumer acceptance of the timeshare concept is one reason for industry optimism.

"Consumer acceptance of timesharing has never been higher," says Ron E. Jackson, president and COO-North America for Resort Condominiums International LLC, the world's largest timeshare-exchange company. "Timesharing offers consumers what they are looking for in their vacations today: flexibility, convenience and value."

Increased consumer acceptance has made timesharing the fastest-growing sector of the tourism industry. "With the entry of large, public companies into the industry, timesharing has gained credibility," Ragatz says. "The product has improved, new concepts have been introduced, and timesharing appeals to a more sophisticated consumer."

Upper-income consumers

One reflection of this appeal is the rising household income of timeshare owners. In 1978, the median income of timeshare owners was $23,000, versus $14,900 for all U.S. households. In 1998, it was $68,425, an increase of 197 percent, versus $36,700 and an increase of 146 percent for all households. Ragatz attributes the 50 percent higher income-growth rate among timeshare owners to the increased attractiveness of today's timeshare product to higher-income households.

"We used to sell just bricks and mortar," he says. "Now we're offering a product with all the bells and whistles. Savvy consumers realize today's timeshare product offers great flexibility and spacious units with all the amenities they could want."

Ragatz points out, however, that some timeshare developers are finding success by marketing to "middle America." For example, Silverleaf Resorts Inc., recently ranked 100 in Forbes magazine's list of 200 Best Small Companies, markets itself as the "Wal-Mart" of the timeshare industry. "Timeshare companies, similar to hoteliers, are offering a product for a range of income groups," he says. "Economy, midrange and upscale products are all available."

Silver market is golden for timeshare companies

The age range of the typical timeshare buyer is widening.

The old days of timeshare companies limiting tours to prospects between 35 and 55 years of age are over, and for good reason. Of those purchasing timesharing in the last two years, more than 40 percent are older than 55, and nearly 20 percent are 65 and over. In the 1978 study, only 20 percent of timeshare owners were older than 55.

"Seniors tend to have a high amount of absolute disposable income," Ragatz says. "They also have the freedom to travel when they want to. They are not limited by school holidays or jobs."

This trend bodes well for timesharing, too, as the mature market is the fastest-growing segment of the U.S. population. The 65-and-over market is predicted to increase more than 250 percent from 1990 to 2050.

Singles

The growing independence of today's single is also reflected in the study. More than 12 percent of recent timeshare purchasers are single compared to just 7 percent in 1978. "Singles have become more comfortable planning for vacations on their own," Ragatz says. "Timeshare developers are looking beyond the stereotypes and finding singles are an untapped market."

The Manhattan Club, a timeshare resort in New York City, is doing well with singles; approximately 23 percent of its owners fall into this category. The resort's director of sales, Bob Larsen, says the urban timeshare resort offers singles, especially women, security and a home-away-from-home environment, along with opportunities to mingle with other owners and access to the city's attractions.

But singles don't buy just in urban locations. Trendwest Resorts of Bellevue, Wash., reports that 20 percent of its owners are singles. The company's points-based system offers flexibility and convenience, including the ability to vary unit size, location and season from year to year.

The trend should continue, too. In a YP B Yankelovich Partners 1997 study, cosponsored by RCI, 49 percent of singles expressed interest in purchasing a timeshare unit.

RCI Consulting and RCI

RCI Consulting is the research and consulting arm of RCI. This is the fourth major study released by RCIC this year. Other studies released in 1998 are The Public Image of Resort Timesharing, 1998 Edition; The Benefits of Owning Resort Timesharing, 1998 Edition; and Resort Timesharing Gaming: A Survey of Resort Timeshare Owners in Atlantic City, Las Vegas and Reno.

RCI is the world's largest timeshare-exchange company with more than 3,300 affiliated resorts in nearly 90 countries. In 1997, RCI booked more than 1.8 million exchanges, sending more than 6.5 million people on vacation. RCI is a subsidiary of Cendant Corp. (NYSE: CD), the world's foremost provider of consumer and business services.