Disney Direct Tricks?

Discussion in 'Purchasing DVC' started by dwight16, Nov 13, 2013.

  1. DougEMG

    DougEMG DIS Veteran

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    Yup, the price drop in 2011/2012 was what finally brought DVC with my price range. :cool1:
     
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  3. dmunsil

    dmunsil Disney Uber-Nerd

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    Totally in agreement there.

    It clearly can be made nontransferable. They could make the "club" a discount club, where you just get a fancy timeshare-style villa at a specific discount. The numbers could be exactly the same, but you don't "own" anything. The problem is that people have trouble laying out a bunch of money unless they are "buying" something with that money, so timeshare developers choose to make it an ownership. I think you agree that it's really all about making people comfortable with with paying all that money; people like owning things.

    What's not really possible is selling someone something that is owned via a deed or something similar, and then stopping them from selling it to someone else. The first sale doctrine applies, at minimum. And then whatever that deed actually is title to has to actually transfer. The more you load up the membership with non-deeded amenities, the more you risk people seeing it as more like the "club membership" thing and less like a "ownership."

    Absolutely. They care about the resale price only to the extent that it helps them sell direct. And perhaps to some extent the effect on the Disney brand, but that's got to be somewhat secondary.

    They don't care about random complaints from owners about small-potatoes stuff like the valet parking thing. They would absolutely care about a big investigative report into "the sleazy timeshare division of Disney that is fleecing retirees". So they need to make sure that never happens. They do care about the Disney brand, so there are places they can't go that maybe another more fly-by-night company could go.

    I think resale is highly supply-constrained. There are a few owners who are sitting on the sidelines and will put their ownership up for sale if the price rises, but it's clear that the supply of resale deeds is primarily driven by people who are tired of owning DVC or have hit financial problems and can't afford their membership. If Disney did anything to increase resale demand, prices would go up. For example, Disney could quietly invest money in one of the DVC resellers and provide them with more promotional money to drum up resale business. They could rent one of their mailing lists, like D23 or something, to a reseller at a bargain price. Anything that causes the number of buyers to go up in the resale market will drive the prices up. It wouldn't take that many people.

    Yes, this might have an effect in the short term on their direct sales, but not by much; the resale market is a fraction of the size of the direct market. And once resale prices were a significant fraction of direct prices across the board, Disney would be in a better position to make direct sales, because as we both agree, high resale prices make people feel better about paying high direct prices.

    The alternative, continuing to add resale restrictions, drives resale prices down, which hurts their direct sales among the people who know about resale. That's not a lot of their customers, but certainly it's some of them.

    Timeshares are a weird business. If you ask any other real estate developer if they'd prefer third-party home sales to trend higher or lower, they'd think you were an idiot for asking the question. Their direct prices are anchored to the (much larger) resale market, and they know they'll make more money if the resale market goes up. In the timeshare business, they rely on the lack of transparency in the resale market to charge people way more than the resale price, even in a case (like DVC) where the direct price is actually financially supportable.

    Disney is not ripping people off with their direct prices; the product is worth, arguably, even more than they're charging right now. There's no reason resale prices couldn't be even higher than they are now.
     
  4. Dean

    Dean DIS Veteran<br><a href="http://www.wdwinfo.com/dis

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    I'm pretty sure that's not possible in FL at least. As for the rest, I think we're pretty close just approaching the issues from different sides. I do disagree on their options (or reasonable ones) to prop up the resale market. As you say, it's not a transparent system. People sometimes want to discuss it like new/used cars and those issues don't apply. The main problem for timeshares is that market forces aren't the main issue due to the inherent fringe nature of timeshares, even at Disney. And I do feel there will be more resale restrictions and retroactively. We'll see.
     

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