1BR Villas?

[Genie+]

However, I will also note that DVC has been willing to do such reallocations---in particular the treehouses vs. 2BRs at SSR. But, in that case, I don't think they violated the SSR 2BR max values, because they reduced them, so the max value is still true. I don't know whether or not the Treehouses had separately published max values when they were introduced. If they did not, then I think while the change violated the spirit of the documents, it may not have violated the letter.

Yeah the interesting result with the treehouses is that DVD ended up with less points to sell with the addition.

Just as a simplified math example - if the 2BRs were avg 46pts/nt and mostly already sold out before the treehouses were added at an avg 48pts/nt, but first they reduced the 2BR to avg 44pts/nt by reallocating 2pts/nt to treehouses, that could leave DVD only 46pts/nt to sell for the treehouses. DVD has 2 less points to sell across each treehouse x365/days.

Before PIT went on sale and point charts released, some people had speculated that the original Poly long house studios may be lowered so they could charge more points on the tower studios. But that didn’t really make sense, because DVD would have ended up with less points to sell in the tower. But it seems they did go this route with SSR treehouses?

 

[thanxfornoticin]

There have been many years of inaction that has caused the problem to get out of control and now that they're moving they're moving too slowly.

I know you feel strongly about the topic, but I don't see the situation being out of control. They change and adjust the points up and down based on supply and demand, and probably a couple other factors. There are other things around DVC I view as much more important than how quickly they tweak the point charts. Maybe I'm just fortunate and the times of year I tend to go haven't been a problem for us - the charts have changed over the years, but nothing that's caused us concern and nothing that's indicated to us they need to do more. We're planners and almost always look to book at 11 months, so what we want to book is available 98% of the time.

 

[Tatebeck]

Okay I'll make one more attempt at explaining this.

1. Cash Prices are a Direct Reflection of Organic Demand
In the cash marketplace, room availability remains roughly equal throughout the year. Because supply is static, the transparent, publicly available cash prices act as the sole mechanism to balance the quantity demanded. Therefore, when cash prices rise during periods like spring break or Christmas, it is not arbitrary; it is a direct, quantifiable measurement of increased organic consumer demand for that specific timeframe. The cash price is the mathematical translation of how badly people want to travel at that time.

2. The DVC and Cash Populations Share Identical Demand Curves
There's no reason to assume that demand patterns between cash guests and points guests are anything other than homogenous. The desire to travel during holidays, school breaks, or prime weather seasons does not change simply because of the currency the guest is using to book the room. If underlying seasonal demand spikes for a cash guest, it inherently spikes for a points guest.

Disagree on both 1 and 2 for various reasons.

1.
While price does ebb and flow with demand of course, but I think it is more a reflection on how much money Disney can wring out of their guests (while still providing a good experience). Disney is not an all-inclusive resort. They do many things other than just adjust room pricing so it is NOT "the sole mechanism to balance the quantity demanded" like you say. They can do things to increase value in other ways, and they have ways that they can change the quantity of rooms available as well.

The price of the room is only 1 factor of many with tickets, lightning lanes, food, crazy amounts of merchandise, other premium tours/expenses, spa, etc. And they adjust many things outside of just the price of the room to get guests on site. Free dining offers instead of lowering the price of the room. Free water park entry during slow periods or rebuilding years. Ticket deals if bought with a room. The list can go on and on.

They can also sell large swaths of rooms to conventions when they are happening which means they won't have to sell the same number of rooms at all periods. They can also put their refurbishments during off-peak dates to have more rooms available for their busier dates and less available during the slow periods. So the room availability isn't necessarily equal throughout the year either. They have a very complex system going, especially at WDW in particular.

And in the end the room rate doesn't really go up and down organically with demand anyways, Disney sets the cash price, which regularly increases over time. And then they run promos to increase sales of rooms, (which yes often does include temporarily discounting the rooms, but not actually lowering the base room rate). If they could fill every room at full price and keep increasing the rate, they would likely be very happy to do so.

2.
I feel the exact opposite. There is no reason to assume that demand patterns between cash and point guests would be identical. The hotel guests have Value, Moderate, and Deluxe levels to choose from, and mainly hotel room style rooms with much fewer larger rooms compared to DVC. DVC has all Deluxe accommodations, with many more larger-room-style setups available. So the room choices are very different.

And then the guests themselves can be very different as well. Instead of hotel guests who are IMO more likely to be doing a once-in a lifetime, once in a childhood, etc. style trip, DVC guests are guests who know they will be coming back year after year, may have had their kids already move out and are mostly avoiding the spring break/winter break dates, etc. I bet the average DVC member spends a lot more time at the resorts vs average cash guests as well. Having been both types myself, it is a very different vacation feel.

There may be some overlap, (especially with renters for DVC points instead of staying cash but bringing in more of the "cash stay" style of vacation into the DVC stays) but even that overlap may decrease with some possible/hopeful cracking down on commercial DVC renters.

 

[PolyRob]

I would quibble with this. DVC owners are a self-selecting subset of the "will pay money to stay in a WDW-owned hotel room" population, and the nature of buying a multi-year-to-decades product may differentiate the two in some ways.

For example, I suspect (but do not know) that DVC owners, as a whole, are older and less likely to have children in the house than the population of cash guests, as a whole. If that's true, then "school holidays" are more germane for cash demand than for DVC demand.

But I do believe that they probably track fairly closely.

Strongly agree that DVC and non DVC Disney guests have discernible differences. They are not identical and that effects the time periods in which they prefer to vacation.

Disagree on both 1 and 2 for various reasons.

1.
While price does ebb and flow with demand of course, but I think it is more a reflection on how much money Disney can wring out of their guests (while still providing a good experience). Disney is not an all-inclusive resort. They do many things other than just adjust room pricing so it is NOT "the sole mechanism to balance the quantity demanded" like you say. They can do things to increase value in other ways, and they have ways that they can change the quantity of rooms available as well.

The price of the room is only 1 factor of many with tickets, lightning lanes, food, crazy amounts of merchandise, other premium tours/expenses, spa, etc. And they adjust many things outside of just the price of the room to get guests on site. Free dining offers instead of lowering the price of the room. Free water park entry during slow periods or rebuilding years. Ticket deals if bought with a room. The list can go on and on.

They can also sell large swaths of rooms to conventions when they are happening which means they won't have to sell the same number of rooms at all periods. They can also put their refurbishments during off-peak dates to have more rooms available for their busier dates and less available during the slow periods. So the room availability isn't necessarily equal throughout the year either. They have a very complex system going, especially at WDW in particular.

And in the end the room rate doesn't really go up and down organically with demand anyways, Disney sets the cash price, which regularly increases over time. And then they run promos to increase sales of rooms, (which yes often does include temporarily discounting the rooms, but not actually lowering the base room rate). If they could fill every room at full price and keep increasing the rate, they would likely be very happy to do so.

2.
I feel the exact opposite. There is no reason to assume that demand patterns between cash and point guests would be identical. The hotel guests have Value, Moderate, and Deluxe levels to choose from, and mainly hotel room style rooms with much fewer larger rooms compared to DVC. DVC has all Deluxe accommodations, with many more larger-room-style setups available. So the room choices are very different.

And then the guests themselves can be very different as well. Instead of hotel guests who are IMO more likely to be doing a once-in a lifetime, once in a childhood, etc. style trip, DVC guests are guests who know they will be coming back year after year, may have had their kids already move out and are mostly avoiding the spring break/winter break dates, etc. I bet the average DVC member spends a lot more time at the resorts vs average cash guests as well. Having been both types myself, it is a very different vacation feel.

There may be some overlap, (especially with renters for DVC points instead of staying cash but bringing in more of the "cash stay" style of vacation into the DVC stays) but even that overlap may decrease with some possible/hopeful cracking down on commercial DVC renters.

I agree with these statements. I understand rack rate is supposed to balance demand, but like @Tatebeck mentioned Disney manipulates demand throughout the year. It adds parties, festivals, RunDisney events, conventions, etc to keep the resorts and parks full.

I also believe Disney World still considers late spring and summer it's peak season based on refurbishment schedules and new additions. Look at what is opening this month and next month at WDW (Buzz Lightyear, Big Thunder, Millennium Falcon storyline, Soarin' update, etc). Plus all major lands in the past decade targeted summer openings. Summer is also the only time of the year there is no Epcot festival.

To state DVC demand is the same as cash guest demand isn't accurate. DVC members are repeat guests. They've been to WDW and they know what they like. So many times you hear people say DVC members and AP holders are cheap and WDW only caters to the "one-in-a-lifetime guest." That's who books rack rate.

 

[Brian Noble]

I understand rack rate is supposed to balance demand, but like @Tatebeck mentioned Disney manipulates demand throughout the year. It adds parties, festivals, RunDisney events, conventions, etc to keep the resorts and parks full.

But presumably those attract guests in general---including DVC guests---and not just cash guests in particular.

 

[Tatebeck]

But presumably those attract guests in general---including DVC guests---and not just cash guests in particular.

True, those things will draw guests from everywhere. Onsite, offsite, cash, DVC, etc. But DVC by design operates at near 100% capacity all the time and the point charts are much more fixed than the cash prices/promos. So while it may attract guests from DVC to certain times of the year, I would argue it is done primarily, or at least more for the cash guests.

 

[PolyRob]

But presumably those attract guests in general---including DVC guests---and not just cash guests in particular.

Oh yes, that definitely happens, but then you also see DVC Members that won't pay for MVMCP because it's the same thing every year besides 1-3 characters and a new cookie. Disney also gives DVC discounts to certain parties and DVC runs extra "membership magic" stops at certain parties. I don't think Disney is doing this because it's so crowded, it's forcing demand onto those specific parties.