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In This Issue:
Visual
Data About UsVisual Data Systems is a leader in Internet marketing, technology consulting and World Wide Web design. As a pioneer in Internet business, we've logged more than a decade of achieving customer satisfaction and Internet innovation. Visual Data Systems offers a wide variety of products and services that can be customized to fit your unique business needs. Let our experienced professionals polish your ideas and dreams to create your distinctive Internet presence. At Visual Data Systems, there are no barriers. Just Innovations. News & EventsCatch Visual Data Systems at the upcoming Conferences: RMS Users Conference Wilmington, NC, September 22-24 Vacation Rental Managers Association (VRMA) National
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August
2003 • Volume 1, Issue 3 ResortQuest Goes CountryFive years and many broken hopes since ResortQuest set out to dominate the vacation rental industry, the nation's largest vacation rental manager is planning to merge with Gaylord Entertainment, owner of the Grand Ole Opry, and Nashville related hotel and entertainment businesses. No cash, this is a stock-for-stock merger, where ResortQuest shareholders will trade each of their shares for 0.275 shares of Gaylord (amounting to an 8.4% increase over ResortQuest's prior stock price). I'm excited. Bright as I am, I bought my first RZT stock at $16. Wall Street analysts projected $24 within a year. Wiser with experience, I bought my second round at $8 and watched it drop to $3. Oh well. All looked lost until now. ResortQuest was straddled with debt and cash poor. Inventory was down, and profits were shrinking (though they tell us revenue per home is up!!). Now here comes the cavalry to save the day, General Custer at the fore (I mean Gaylord, king of country). Gaylord is bringing $10 million of working capital and is offering to refinance all of ResortQuest's debt. I can sell, if I hurry, at $5+. If the creek don't rise and my horse don't go lame, I'm gonna do it. Okay. Let's get to it. What can Gaylord do that ResortQuest couldn't do on its own? Gaylord thought I'd ask this question. Its "big bang" theory lies in Gaylord's bombshell research discovery. Are you breathless and sitting on the edge of your chair? Here it is. Gaylord thinks that it can sell ResortQuest's vacation rentals to "country lifestyle" customers (who it defines as living primarily in the Southeast or Southwest, and people who like camping, hunting and fishing, as well as the country music of Gaylord's Grand Ole Opry and radio stations). Approximately 30% of "country lifestyle" consumers indicate they have stayed in rental accommodations more than once during the past two years. Gaylord's CEO believes this is a much higher percentage than for the normal population. Now sit down a minute, Bubba. So you can absorb the really big revelation: Gaylord found out that 40% of Americans buy into the "country lifestyle". Whoa. Look at them numbers. Get in the truck mama! We're gonna get drunk and …(have a good time)!. Thirty percent of 70 million Americans equates to 21 million prospective guests. And Gaylord has access to them, via radio, television and ticket sales for the Grand Ole Opry!!. Now I understand. I'm a Montana boy. Country music is the only place left where men sing like men (deep, remorseful voices that chronicle our real lives-lots of drinking, fighting, card playing and extra-curricular experiences.). I love country, as does my unmarried sister-in-law. Unfortunately, we're not allowed to listen to it when my wife is around. So it doesn't take much for me to become a believer. Rent a home from ResortQuest and get a free Trace Adkins album. And look at Gaylord's business plan. Gaylord knows that the consumer is looking for an industry leader. As things stand, ResortQuest says, its biggest competitors are "mom-and-pop's." With proven talent in creating a brand, vast financial resources and its lock on "country lifestyle," Gaylord is ready to kick some mom and pop butt. This is so compelling, I want to pick up the phone right now and make a reservation. But I'm distracted by echoes from the past. Can't quite remember. Oh yeah. Hotel people--smarter than anyone in THIS industry. They'll be able to use their experience to drive more customers to the ResortQuest companies. They'll be able to use their extensive advertising war chest to create a national brand. They'll implement "best practices" for the country crowd that mom-and-pop's can't possibly match, country bumpkins that THEY are. And they'll use a lot of high priced talent to let the consumer know that he can get a better value proposition from ResortQuest. Could I have heard all this from ResortQuest corporate people, generation one? I gotta ask. What makes corporate hotel execs think that "bigger is better" in the vacation rental business? How much ego do you need to still believe that you can bring hotel branding concepts to vacation rentals? What did Gaylord's chairman, Michael Rose, fail to learn during his stint on the ResortQuest Board? What does Gaylord know that was missed by Marriott, who reportedly passed on the ResortQuest opportunity? I looked at the Gaylord convention-focused hotels (in Nashville, Disneyville and--soon to be--Texas). Their package looks good: great service and a great product in a great entertainment environment. But how, exactly, will Gaylord control product quality in vacation rentals (don't the homeowners still do that?)? How will it control the service quality (won't its companies be lucky just to get housekeepers and maintenance people?) How will Gaylord find rentals for all those newly generated country guests who want to come during the peak season? How will it get country folk to pay rents that traditional customers find too high already? And tell me again why mom-and-pop's are such easy targets? Oh, and how much advantage is it to be a publicly traded company that must justify its financial results to shareholders once every three months? I guess life is going to change for my clients that compete with ResortQuest. Until now, they've been fat and happy, feeding off the carnage whenever ResortQuest has taken a perfectly wonderful vacation rental company and siphoned money away to "improve" it. But then ResortQuest's former management didn't know "country". So, I have this message for all you independents out there. Don't take out any new mortgages. Don't start supporting any new activities. Don't throw away your money in a bar. Gaylord is about to make ResortQuest what it was designed to be: the recognized leader in vacation rental management across the US. As independents, you will all be lining up to get in the franchise door. Sorry. I just can't help myself. One more corporate guy, looking down from above at this crude industry, coming in to show us how business should be done. Color me green with envy! The truth is, Gaylord will inherit some companies that were among the nation's elite vacation rental managers. It will get some fantastic field managers (if it will listen to them). And it offers some sound strategic goals: it will focus on the larger, more profitable markets; it may well be able to cross-sell 8 million customers; and every new dollar of rental income it produces will generate more money for homeowners, causing ResortQuest to grow. So we should pay attention. Entertainment seems to be the new buzzword and I, for one, am conforming to the new standards. I guess I'll "perform" at the upcoming Visual Data Systems seminars. I may bring my guitar. Maybe we'll all sit around the bar and talk a bit. About old times. And new. And ResortQuest. Or, hell, maybe we'll just get drunk and . …". Hope to see you there.
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Visual
Data Systems, Inc. To unsubscribe to The Visual Exchange, please send a blank e-mail to: remove@x.vdsys.com. Copyright © 2003 by Visual Data Systems, Inc. All Rights Reserved. |
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