A View from Here

Bill's Sisson's weekly Trade Only blog

Fractional ownership

I had dinner the other night with a busy industry executive who said something interesting. He has the money to buy a boat, but questioned why he’d make that investment when he’d probably use it once or twice. And he didn’t want the hassle of maintaining the boat or even finding a place for it, plus all the other extras inherent to owning a boat.

What would appeal to him, however, was fractional ownership. He would still enjoy the sport, but without the added worries of owning the boat by himself.

He questioned whether boatbuilders would benefit if they started advertising fractional ownership, very much like resorts advertise timesharing.

Soundings Trade Only did a story in August 2006 about fractional ownership. We talked to three of the largest companies in the business who said they experienced huge increases since opening their doors.

Now, I pose my dinner guest’s question to the boatbuilders and their dealers?
Is this marketing strategy a feasible option, especially during a lackluster environment when too many things are vying for consumers’ discretionary income? Or, if you are already engaged in such a strategy, would this be something you’d want to strengthen?

Lois Caliri
Editor
Soundings Trade Only

Comments

6 comments on “Fractional ownership

  1. BILL COLEMAN

    WE ARE PROVIDING AN INSURANCE PACKAGE FOR SEVERAL FRACTIONAL PROGRAMS HERE IN THE U.S. WITH GOOD SUCCESS.THE DIFFERENT TYPES OF OWNERSHIP PLANS MAKE IT DIFFICULT FOR BUYERS TO EASILY UNDERSTAND HOW IT WILL WORK FOR THEM.THE CHALLENGE FOR THE DEALERS IS TO PRESENT A SIMPLE MODEL OF THE PROGRAM THAT GIVES THE CUSTOMER THE CONFIDENCE TO BUY. THE BOATBUILDERS HAVE BEEN VERY PLEASED WITH THEIR RESULTS AND I BELIEVE WILL TAKE A HARD LOOK AT DOING MORE OF THESE PROGRAMS IN THE FUTURE.

  2. Josephine Williams

    We are marketing The Moorings Fractional Ownership Program which enables buyers to own a share of a Squadron 78 motoryacht for a fraction of the cost. We’ve had a lot of interest from owners who just want to use a week or two a year without the traditional hassles of ownership. We are able to offer financing solutions and the shares start at $75,000 so its very affordable to a wider market who don’t necessarily have millions to spend. It does require time, focus and resources to get the marketing out there and educate consumers.

  3. JR Hilderbrandt

    We just designed an online boat availability calendar that we tend to market to the different boating clubs. The service allows shareholders to view the boats availability and reserve it online for a small online fee ($5). The shareholder pays this fee. There is no set up cost to the club for the service and the club management has full access without any fees at all. This allows the shareholders the ability to still make reservations through club management for free. The club also has access to update the calendar or remove, deactivate boats for maintenance, add pictures, change description and advertise their memberships to other prospective clients. The system was design to keep the boat share/club availability true and honest. This is an issue that has been a concern to new prospective members.

    JR Hilderbrandt
    BoatRenting.com Inc.
    RentaBoat.com

  4. G.Campbell

    We have developed a fractional ownership program for 20′ – 30′ boats we will be starting up in 2008 in addition to our main dealer activities. If anyone has information on insurance or management software please contact me at the email below.

    Thank you,
    gvcampbell@yahoo.com

  5. Chris Barry

    There will be a paper on design, construction and management of fractionally owned US flag superyachts at the March 2008 Chesapeake Powerboat Symposium.

  6. Hunter Ross

    I thought I would throw my 2 cents in. I think that you will find there are many companies out there who have considered advertising but are not sure where to start. We just recently decided to dive in and see what was out there with our recent national ad in Travel Connoisseur Magazine. You can see it on their site at http://www.thetravelconnoisseur.com or the full spread is on our site at http://www.MiracleYachts.com on the Press page.

    There has been a tremendous increase in exposure and demand created in the last year and a half surrounding our industry and we are excited to be a part of that. We have seen a tremendous amount of interest from new entrants into the yachting world who see us as the easiest and safest way in. They love not having to deal with any of the details knowing they can enjoy their yacht headache and hassle free.
    We have also heard from many current yacht owners who tell us they are really happy to see that finally someone has put together a fractional program that makes sense. I am currently trying to get those guys to sell their yachts! :)
    I think you will steadily see a switch from traditional yacht ownership as more and more people start learning about it and see that it really works beautifully when done correctly.

    We are also reaching out to other companies within the luxury fractional industry to see where smart partnerships can be made. Many of the new destination clubs and resorts are looking starting to look at us and go, wow we could use these fractional yacht ownership shares to set ourselves apart and bring a value add to the consumer. I hope those types of opportunities will continue to evolve so we can do some cross marketing in the future.

    I hope this gives a little to the conversation and gets people thinking about what’s coming up in the future. If you have any questions please give me a ring or shoot me an email anytime.
    Best Regards,
    Hunter Ross
    President
    Miracle Yachts, Inc.
    California Texas Florida

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