Recession-Themed Promotions

Steven Heydt from Elite Island Resorts came up with a creative promotion that not only aligns investors’ depressed moods to the plus of a vacation in his chain, but also landed them broad media coverage, like this story in the New York Times.


December 6, 2008

Swap Stocks for a Week at the Beach


Need a vacation from watching your stocks drop?

Hoping to lure travelers as the economy slumps, a resort chain in the Caribbean is offering to trade rooms for depressed stock.

Elite Island Resorts, a chain of upscale hotels — including the St. James’s Club on Antigua and the Palm Island Resort in the Grenadines — announced Friday that it would accept payments in stock for vacations booked by Jan. 31, using the value the stock was trading at on July 1. The deal, in effect, gives travelers a chance to roll back the value of currently depressed stocks to levels before the market began to really sink.

“Things are so quiet you have to do things out of the box,” said Steven E. Heydt, president of Elite Island Resorts, who concocted the idea. “I’ve been thinking about what could I do to turn things around and somehow relate to the overall economy and the stock market declines.”

Here’s how the promotion works: An all-inclusive seven-night stay for a family of four begins at $4,445 based on a nightly rate of $635 at the Verandah Resort and Spa in Antigua. A traveler with American Express stock, which closed at $21.78 Friday, would need about 111 shares for the trip, with Elite Island Resorts valuing the stock at $40 a share or approximately what it was trading for on July 1.

Merrill Lynch stock is even better. It closed at $13.04 Friday, down from $32.25 on July 1.

The deal is good for vacations through mid-December of next year, with no blackout dates. So travelers can use stock for payment even during peak holiday travel periods like Christmas, New Year’s or Easter, as long as space is available. Vacationers “paying” with stock may hold a reservation for a specific date if they wish with a credit card, which will not be charged, while the stock is being transferred into a dedicated Merrill Lynch account. Travelers should consult their accountant about any possible tax implications resulting from such a transaction.

The maximum credit per room that will be accepted in stock is $5,000. If a vacation costs more than $5,000, the difference will be charged to a credit card.

Elite Island Resorts initially set aside $10 million in room inventory for the promotion, but it might expand the program.

The company has selected about 100 stocks of major companies including Aetna, Citigroup, General Electric and MetLife. (For a complete list of qualified stock visit

The company plans to hold onto the stock until it can trade or sell it. With demand off between 25 and 30 percent, said Mr. Heydt, the promotion is “a far better way for us to have a return on our investment.” He added, “We all believe there is great value in the U.S. stock market. We are willing to wait for this market to turn around.”

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