DVC Moderate Resort Being Reported by WDWNT

[lockedoutlogic]

I think you are not neccessarily in the minority... at least not deeply.... I think a rep told us the average owner ends up with about 300.... but you know how averages work, and sales guides....

If you look at how hard it is to get the values and the standards and the parking lot views, it makes one think there are quite a bit of "you".... and imagine a resort they could fill with "your Kin". ......

You have to ask yourself if Disney wants people squeezing more usage out of their points...

If you blow lots of money on tickets, drinks, food and lots of merch while you're there...absolutely.

If not...no...they honesty don't want you there.

 

[linzbear]

Great conversation/thread...they all should be like this...

(This is usually where I get called for hooking/slashing and head to the box)

But let's play my favorite game: Disney management should/could/will (queue cheesy theme music)

My opinions:

What they SHOULD do is price the points the same...but charge vastly less per night for accommodations at any new "second tier" properties like Caribbean. 6 for a studio.

What they COULD do is discount the points, charge slightly less and then do a lock into that type or charge more to exchange out than the old buyers. I.e. you can book Caribbean for 8...but instead of beach club at 14...it's gonna be 18 a night.

What they will do? It's gonna be upfront the same and then a poorly thought out plan to charge "slightly" less in points for Caribbean. "Only 10-11 a night for a studio". That's a disaster...mistakenly thinking your customer is "really dumb" as opposed to just "dumb" (that's the fact of the matter)

Does option 3 sound familiar? It's because it was called "Disneys Saratoga springs resort" the last time they tried it. Instead of the same points as OKW (correct) they made it a measly point or two less than beach, Boardwalk, wilderness. And it's bottlenecked the system ever since. They sold the points...but it just flushed all the rats (like me) out of the nest and Into the rest.

In fact, the next point chart was probably lower than it should have been - I believe in part to compensate - animal
Kingdom lodge...still the best or second best deal of the lot.

We'll see...but I would bet on option 3.

You forgot one thing - theme it to something wholly uninteresting and cheap.

I'm gonna guess Lancaster, PA here. Upscale Amish, it'll be the next big thing at Walt Disney World Resort!

 

[lockedoutlogic]

You forgot one thing - theme it to something wholly uninteresting and cheap.

I'm gonna guess Lancaster, PA here. Upscale Amish, it'll be the next big thing at Walt Disney World Resort!

Disneys Dutch wonderland and bakery?

Open Monday- Thursday?

I'm in

 

[ColoradoDreamin]

I think you are not neccessarily in the minority... at least not deeply.... I think a rep told us the average owner ends up with about 300.... but you know how averages work, and sales guides....

If you look at how hard it is to get the values and the standards and the parking lot views, it makes one think there are quite a bit of "you".... and imagine a resort they could fill with "your Kin". ......

And a rep told us the avg owner has 150 (although I think 150 is closer to the truth).

 

[lockedoutlogic]

And a rep told us the avg owner has 150 (although I think 150 is closer to the truth).

We heard the same years ago. But since that is the minimum (was at the time)...it doesn't make sense for an "average"

 

[ColoradoDreamin]

We heard the same years ago. But since that is the minimum (was at the time)...it doesn't make sense for an "average"

It wasn't the minimum when we bought. Reason they said 150 was the norm was because 150 points will get you a week at any location from the RCI system.

 

[lockedoutlogic]

It wasn't the minimum when we bought. Reason they said 150 was the norm was because 150 points will get you a week at any location from the RCI system.

Yeah...same deal...

"Average" doesn't work though..."median" is probably more correct.

 

[ColoradoDreamin]

Yeah...same deal...

"Average" doesn't work though..."median" is probably more correct.

why I love numbers...you can make it say whatever you want, people will believe you, and you were not lying either.

 

[skier_pete]

This plan doesn't make sense. At a MINIMUM...they need to dredge out a canal to studios to provide direct transport. But they also need standalone dining/facilities...which isn't a great deal for DVC/Disney. They might be underused if isolated...overused if you've got about 7,000 rooms on the grounds (which they do)

This is a GREAT point - but there are exceptions. OKW and SSR both have dining and are DVC exclusive resorts. They almost definitely would have to be willing to put something in - not relying on the overcrowded less than stellar food court that is Old Port Royale and the poor reputation of the TS there.

I'm repeating myself, but I don't see them risking the brand with putting out a true "moderate" experience in DVC. A SSR/OKW level experience, maybe, but not a true moderate. And the I also bet the point level won't be THAT low. DVC does not want to step profits backward.

 

[skier_pete]

And a rep told us the avg owner has 150 (although I think 150 is closer to the truth).

This one question that's easy to answer - from DVC sales posts on dvcnews.com:
May 2016 @ Poly: 147,374 points sold in 1066 contracts = 138 points average
April 2016 @ Poly: 169,377 points sold in 1246 contracts = 136 points average
March 2016 @ Poly: 136,294 points sold in 1122 contracts = 121 points average
Feb 2016 @ Poly: 72,137 points sold in 615 contracts = 117 points average
Jan 2016 @ Poly: 107,615 points sold in 839 contracts = 128 points average
Dec 2015 @ Poly: 76,445 points sold in 636 contracts = 120 points average
So - looking over the last 6 months - the average contract is about 130 points, though in Dec-Mar it was closer to 123 points and hopped to 137 points in April-May. This is probably an affect of the incentive programs that started this year.

Overall though - we can feel pretty good to say the average contract is less than 150 points. I would guess this is somewhat skewed by the fact that a portion of these contracts are 25 and 50 point add-ons from existing members, so NEW member contracts probably average above 150 points, but not by a lot.

 

[ColoradoDreamin]

This one question that's easy to answer - from DVC sales posts on dvcnews.com:
May 2016 @ Poly: 147,374 points sold in 1066 contracts = 138 points average
April 2016 @ Poly: 169,377 points sold in 1246 contracts = 136 points average
March 2016 @ Poly: 136,294 points sold in 1122 contracts = 121 points average
Feb 2016 @ Poly: 72,137 points sold in 615 contracts = 117 points average
Jan 2016 @ Poly: 107,615 points sold in 839 contracts = 128 points average
Dec 2015 @ Poly: 76,445 points sold in 636 contracts = 120 points average
So - looking over the last 6 months - the average contract is about 130 points, though in Dec-Mar it was closer to 123 points and hopped to 137 points in April-May. This is probably an affect of the incentive programs that started this year.

Overall though - we can feel pretty good to say the average contract is less than 150 points. I would guess this is somewhat skewed by the fact that a portion of these contracts are 25 and 50 point add-ons from existing members, so NEW member contracts probably average above 150 points, but not by a lot.

One could also say that those numbers could be skewed by the person that buys 400 points or more -- a true look would be too remove the outliers, but I don't imagine we have the data to do that. You figre there is people that probably bought excessive amount of points (rich) so they could stay at a bungalow for more than one day, thus skewing those numbers as well. Once again...we can make numbers say anything you want if you are smart enough.

 

[skier_pete]

One could also say that those numbers could be skewed by the person that buys 400 points or more -- a true look would be too remove the outliers, but I don't imagine we have the data to do that. You figre there is people that probably bought excessive amount of points (rich) so they could stay at a bungalow for more than one day, thus skewing those numbers as well. Once again...we can make numbers say anything you want if you are smart enough.

Which is why I presented the data as is. You can argue about outliers, both high and low, but the question was "What is the average points per contract" and the fact is the average is what it is - and it lies between 117 and 138 points.

 

[linzbear]

Which is why I presented the data as is. You can argue about outliers, both high and low, but the question was "What is the average points per contract" and the fact is the average is what it is - and it lies between 117 and 138 points.

I thought the question was "what is the average points per owner?" That answer may be very different.

 

[Andrew015]

If Disney charged a similar per-point dollar amount for the moderates as the deluxe, how do you conclude they're taking a lesser margin?

I conclude that they'll take a lesser margin because I don't believe there's any way that they can pass off CBR @ the same rates as Poly, GF, etc. IMO, the only way they could sell it would be at a discounted rate, hence the lesser margin. See below example for my rationale.

Your theory is based on the prospect of incumbent DVC members flocking to the CBR, which is false:

Never said that. What I mean by "decimate the existing program" is with regard to New Sales.

Let's say for arguments sake that they do decide to sell CBR for the same price as the current offerings ($160/pt). With a minimum buy-in of only 100 points (also assuming that the nightly point requirement will be lower, which would make a 100 pt contract do-able), your initial OOP investment is $16K. Current average maintenance fees across property are just over $6.00 per point, and on average, they increase ~3% per year. Total cost of ownership (not include any other costs like tickets, meals, etc.) over 20 years is just over $32K (initial investment + annual inflationary dues).

I don't dispute a previous post in which you indicate that a week @ CBR can be had OOP for roughly ~$1,500. With the same 3% inflation, it would take you 15 years to break even on your CBR DVC purchase as compared to paying OOP. Conversely, a 150 pt contract @ VGF (which I would expect to be comparable in terms of # of nights per year) is currently running ~10 year payback. This is based on the current $160/pt buy in, current maintenance fees and your notion that the deluxe's run about "double" the OOP cost of the moderates, which I tend to agree with.

A longer payback period for a watered-down product seems like a tough sell to me. The only way the payback period becomes more reasonable is by lowering the initial buy-in, which ultimately results in lower margin.

Other food for thought... The current program, as you've mentioned, is marketed as an opportunity to lock in "deluxe vacations @ moderate pricing". No dispute there. What would the target market be for moderate DVC - moderate vacations @ moderate pricing? It's a stretch to call it "value pricing" with such a long payback period. Frankly, I don't see the types of folks who target value/moderate resorts as the type of clientele that Disney is looking for to take the plunge, and conversely, I don't see that same clientele as the type to shell out significant upfront $$$ for ~30+ years worth of prepaid Disney vacations. Disney's strategic focus over the past decade has been 100% concentrated on the upper-middle class and beyond.

Obviously, these are just my thoughts/opinions. I think there's more ammunition to suggest that moderate DVC is a stretch, but YMMV.

Edited to add payback period math for anyone interested:

 

[skier_pete]

I thought the question was "what is the average points per owner?" That answer may be very different.

If that was the question then I missed it. The average points per OWNER is certainly higher, and I would say almost impossible to estimate. If someone really wanted to know - I would suggest posting a poll on the DVC board with various ranges (0-100, 100-200,200-300,300-400,400-500, and 500+). That would give you at least a decent idea where the bell curve is centered - there's a good chance the DIS represents a realistic representation of the real world.

If I had to guess - I'd say the average points per owner is in 200-300 point range. With so many 1 and 2 bedrooms, there has to be plenty of owners with enough points to stay in a 2-bedroom for a week.

 

[gmboy95]

Not my logic as I forgot to mention I would put WLV right there with BWV and BCV. Let's not forget it is on Bay Lake and only a short boat ride from MK. Not to mention the grounds are beautiful at WLV. What does CBV have to justify these high points cost? I will agree they might get away with a fairly high point price and lower cost per night but that is in theory a lower cost DVC. I,ll stick with lower point cost and lower points per night. Location,location,location.

Thats the funny thing about DVC...we bought at VWL back in 2000, and have stayed there a grand total of 1 time....we stayed at OKW in 2001, and fell in love with the place, and that is our got to resort....it has always been easy to access rooms at 7 months, even during Christmas....my fear is that as they continue to expand, it will become harder to access those OKW rooms

 

[gmboy95]

can someone explain what DVC "moderate" means???....is it just studios at CB???.....if thats the case, count me out....why would I do that when i can stay at OKW or SS ??

 

[skier_pete]

can someone explain what DVC "moderate" means???....is it just studios at CB???.....if thats the case, count me out....why would I do that when i can stay at OKW or SS ??

Haha - no one knows what it means - that's why this thread is all speculation. All we know is a rumor that the next DVC is to be build near CBR. No one knows if it will be PART of that resort (like at the Poly) or not. Since no DVC has ever been built near a moderate, the conjecture by some have been a cheaper, "moderate" DVC.

 

[AnnaKat]

I conclude that they'll take a lesser margin because I don't believe there's any way that they can pass off CBR @ the same rates as Poly, GF, etc. IMO, the only way they could sell it would be at a discounted rate, hence the lesser margin. See below example for my rationale.



Never said that. What I mean by "decimate the existing program" is with regard to New Sales.

Let's say for arguments sake that they do decide to sell CBR for the same price as the current offerings ($160/pt). With a minimum buy-in of only 100 points (also assuming that the cost per night will be lower, which would make a 100 pt contract do-able), your initial OOP investment is $16K. Current average maintenance fees across property are just over $6.00 per point, and on average, they increase ~3% per year. Total cost of ownership (not include any other costs like tickets, meals, etc.) over 20 years is just over $32K (initial investment + annual inflationary dues).

I don't dispute a previous post in which you indicate that a week @ CBR can be had OOP for roughly ~$1,500. With the same 3% inflation, it would take you 15 years to break even on your CBR DVC purchase as compared to paying OOP. Conversely, a 150 pt contract @ VGF (which I would expect to be comparable in terms of # of nights per year) is currently running ~10 year payback. This is based on the current $160/pt buy in, current maintenance fees and your notion that the deluxe's run about "double" the OOP cost of the moderates, which I tend to agree with.

A longer payback period for a watered-down product seems like a tough sell to me. The only way the payback period becomes more reasonable is by lowering the initial buy-in, which ultimately results in lower margin.

Other food for thought... The current program, as you've mentioned, is marketed as an opportunity to lock in "deluxe vacations @ moderate pricing". No dispute there. What would the target market be for moderate DVC - moderate vacations @ value pricing? Frankly, I don't see the types of folks who target value/moderate resorts as the type of clientele that Disney is looking for, and conversely, I don't see that same clientele as the type to sell out significant upfront $$$ for ~30+ years worth of Disney vacations. Disney's strategic focus over the past decade has been 100% concentrated on the upper-middle class and beyond.

Obviously, these are just my thoughts/opinions. I think there's more ammunition to suggest that moderate DVC is a stretch, but YMMV.

Edited to add payback period math for anyone interested:

I agree about Disney's strategic focus, and that the lower income clientele wouldn't want to shell out $16-20K for decades of vacations @ a CBR-type DVC.

When we stayed @ CBR in 2008(free dining) in Sept., we originally wanted to stay in Nov., but moved up our trip to free dining time, as we worried that Nov. would see a huge Market correction.
CBR was only $149/night back then. We were thrilled to afford a 12 night stay, and 10 -day park hoppers.

It seemed like we were ALWAYS walking by a DVC sales kiosk in Epcot.
So finally, I wanted to assure myself that DVC was TRULY geared towards the wealthy.
" So HOW MUCH does it cost to buy in--LIKE $40,000?!!", I asked the guide.

The reply was the typical buy-in of 160 points @ $104 /point( AKV), going up to $108/pt. in a couple of weeks.
SO it was under $20K.
He told me that for the first time EVER, you could buy-in initially @ 100 points. Then I asked IF 100 points could get us 9-10 nights per year. He showed us the points for the value studios.
We had the $$$$$$ in the bank, & @ our sales presentation, I told the guide that we expect the economy to crash sometime that year, " but we felt that DVC real estate would always be in demand."
The Guide NEVER told us that the famous 2008 crash had just happened like the day before.

I don't see CBR DVC selling to middle income folks for $20-30K($200 price point versus $100).
They would likely have to finance, & nowadays, middle income families worry about losing their jobs, houses, etc., much more so than prior to the 2008 meltdown.

 

[Bobb_o]

I'm 26 and would love to go to WDW every year. I looked into buying DVC (resale) but it's still just too much money. Why am I going to put 5 figures into multi-decade contract when I can just rent points? That's not even factoring in the maintenance costs. I just don't see a huge benefit in owning.

A "cheaper" moderate DVC contract still probably wouldn't make sense to me.