All we hear about is how the Baby Boomers are entering their retirement years and that fractional real estate ownership is poised to explode not only because it’s smart but because we have 37 kazillion Baby Boomers that are nearing retirement.  While this is true, there is another often forgotten group of buyers - Boomer offspring.  Yes, Generation X will play a significant role in fractional ownership sales for the foreseeable future. 

Ignoring Gen X is nothing new.  It is loosely defined as those born between the years 1965 and 1980, and it continues to be somewhat of an after thought.  With all of the Baby Boomer hubbub and the Millennial banter on almost every topic imaginable (including vacation ownership) Generation X represents a 15 year space in history.  I am a Gen X and while that doesn’t make me an expert on my generation it gives me a bit of a leg up. 

The 51 million Americans who represent Generation X, the eldest of which are now turning 44, are going to play a very important role in fractional sales.  This generation does in fact have disposable income and an enormous desire to spend it.  Let’s take a look at some interesting results from the 2005 American Express Platinum Luxury Survey in which the respondents were 250 Baby Boomers and 250 Gen Xers with incomes ranging from $125k to $199k.  (I used 2005 because that is the only study where the two generations were compared to one another)

According to the survey, “The Boomers are at a different life stage and thus have accumulated many of the “big purchases” the Gen X are currently making, or planning to make. The Boomers are more likely to own original art (31% as compared with 24% among Gen X), a fine jewelry collection (29% to 25%), a vacation/second home (26% to 18%) and an antique or other collection (24% to 18%). Members of Gen X, by comparison, are more likely to place a greater emphasis on active or experiential ‘toys’ such as sports cars, (owned by 28% of Gen X compared with 24% of Boomers) and boats and yachts (21% to 17%).”

So let’s look at these results from a fractional ownership perspective.  If Generation X is more concerned with ‘toys’ then that should make them prime candidates for buying fractionally as opposed to whole ownership.  Why waste gobs of money on a private second home when it can be spent on so many other ‘fun’ things!  My generation is more likely to admit that a private second home isn’t logical and would consider it a waste of money and resources.  By wasting resources I mean building second homes that just sit around empty is not very “Green”.  Green is more than a buzz word now and is becoming extremely important to my generation, but that’s for another blog.

Another excerpt from the study…

“…in a number of luxury experience categories Gen X spending exceeds the Baby Boomers:

33% more than Boomers for entertainment ($3,629 vs. $2,722),

17% more for personal/health services ($3,324 vs. $2,838),

11% more for sporting events ($4,176 vs. $3,769).”

Pam Danziger, founder of Unity Marketing, a consulting firm that specializes in marketing to the luxury market, conducted the Platinum Luxury Survey.  She says, “Marketers tend to think of the Gen Xers as a cohort too small to even worry about, but this research shows that Gen X may be small in size but they are mighty in luxury buying power… They are in a more youthful life stage and are accumulating a lot of big, material goods. Their influence is destined to grow even more in the luxury market in the future now that the leading edge of this generation reaches 40* years of age this year.”  (*That would be 44 this year)

In the book “Beyond Generation X” by Claire Raines, the first chapter is about showing the Gen X workforce appreciation for what they do.  More so than previous generations, Xers appreciate recognition and appreciation.  They also like to be included in all aspects of their work and have a desire to voice their opinions.  Use these behavioral characteristics to improve the level of experience provided by your management team.  More personal attention and a desire to hear the owner’s opinions will go along way.  A high level of service at a luxury Private Residence Club is of great importance to any generation, the difference however is that Boomers simply expect it while Gen X will more likely appreciate it and tell their friends about it.  If your hospitality management team focuses the right amount of effort and attention on a Gen X owner then look out for referrals! 

My advice for selling fractional real estate to the Generation X buyer (and even the Gen Y or Millennials for that matter) is twofold: 

1)  Gen Xers are more resourceful and don’t rely on people to guide them like Baby Boomers do.  They like to do their own research and then contact you with questions.  So provide them more information on what you are selling and provide it earlier in the sales process.  More informed buyers are more qualified buyers for your sales team and everyone will benefit from shorter sales cycles.  

2)  Focus on these types of messages in your marketing:   

-“You are important to us, we’ll treat you like a king”

-“We’ll take care of your home, you take care of yourself”

-“Use your home when you choose, as much as you choose”

-“Vacation logically, spend your money logically”

-“Your time off is important to you, spend it wisely”

If you spend a little extra time considering the X market you’ll have better results moving forward.  Plus, if you target Generation X then you’ll inevitably reach twice as many Baby Boomers along the way.  There are 79 million of them, how can you miss?

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Eric Pierce is the founder and President of Pierce Group, LLC.  A provider of consulting services to the Fractional Real Estate industry including Private Residence Club developments.  To learn more about Pierce Group visit www.PierceGroupConsulting.com