DVC Trust Eroding - Trust Thermocline

[Royal Consort]

Since the condo meeting I've been thinking about the future of DVC and my relationship between the US parks (I frequent the Asian parks which have a different business ethos) and continue to feel unsettled regarding the direction of the company from their timeshare, parks, and film businesses.

That we are talking about multiple different timeshare systems within DVC that appear haphazardly and inconsistently applied seems ridiculous. The fact that any of us are having conversations about restrictions/non-future restricted resorts isn't a failure of the fan base. It's a failure of an organisation to engage in a predicable manner and effectively communicating and listening to its consumers. Although DVC haven't announced a timeshare trust system, that would only muddy the waters. A business must always prioritise their financial interests but ideally balance these in the ongoing relationship they have with the consumer. If that relationship becomes too unidirectional, it affects good will and consumer retention.

I wonder if DVC is in the midst of the trust thermocline.

What is a trust thermocline? It asserts that a relationship between a company and its audience is non-linear. It is the point at which customers precipitously abandon a company for no single reason. A cumulation of business decisions result in an erosion of trust and loss of faith en masse (higher prices, removing DVC APs in the pandemic, restrictions, no restrictions, lockoff premium, unthemed refurbishments). Tech strategist John Bull explained the process as part of his consulting role:

https://mastodon.social/@garius/109279394369832433

This article makes explicit reference to the trust thermocline at Disney parks:

https://every.to/p/breaching-the-trust-thermocline-is-the-biggest-hidden-risk-in-business

I'm interested in how this applies to DVC. I now notice my initial thought about anything DVC does is "I wonder how they will negatively impact owners this time?"

Thoughts?

 

[DanCali]

I think most of the talk about new systems, resale restrictions, real estate trusts etc. do not really impact the average DVC owner. Most existing owners probably own a relatively modest number of points, and use them in a manner they got accustomed to. They necessarily don't follow these changes, and may not be impacted by them at all if they bought from the developer or even if they bought resale. Any changes going forward will be marketed as an improved/enhanced product and I'm sure that the vast majority of the people who hear the pitch will probably buy into the positives and not think of the long-run negatives.

Consider Riviera-like resale restrictions. It's debatable how much they will impact resale values but they certainly will have an impact. That's unequivocally bad for direct buyers and, to me, that's a deal-breaker. But that doesn't mean I wouldn't buy the Riviera product resale if the resale price was "low enough" for my own taste (and it may never get there). And many informed owners were still happy to buy direct for their own reasons while others were lining up for a potentially restricted Poly2 fully knowing the impact those restrictions may have. To me, that speaks to the strength of the brand and customer loyalty despite some material changes to the product. So I'd argue that the product itself is still very attractive for almost all - those unaware of the changes, for those who can live with the changes, and even for those who vehemently dislike them but continue to use their ownership and the various perks associated with it.

I'm also not a fan of some recent films (not just Disney). But I think people tend to separate movies, from parks, from hotels even if they fall under one umbrella.

I think the one primary thing that can lead to a scenario for DVC like the one you describe is consistent large hikes in annual dues year after year. That impacts all the owners and can lead to a "death spiral" where unpaid dues lead to an even increased dues burden on remaining owners, leading to more unpaid dues etc. But it looks like DVC is keeping things relatively very much in control on that front, even in this period of high inflation. I own some Marriott Vacation Club deeded weeks where the annual dues increased 33% over the past 2 years... If MVC can avoid a "thermocline" under this type of scenario, I wouldn't expect it at DVC anytime soon, or ever.

 

[skier_pete]

I don't even understand what you are specifically saying as the cause.I've been watching DVC for 10 years, and I don't think that DVC specifically has done anything that will cause an erosion of trust in the buyers, is it potentially that Disney has? I don't see the crowds slowing down particularly. I just continue to believe that the majority of new buyers do not pay attention to things like resale restrictions. Yes, many long-time owners do, and they probably are hurting their market a tad there with the add on buyers, but I don't think new buyers care that much.

 

[zavandor]

I don't even understand what you are specifically saying as the cause.I've been watching DVC for 10 years, and I don't think that DVC specifically has done anything that will cause an erosion of trust in the buyers, is it potentially that Disney has? I don't see the crowds slowing down particularly. I just continue to believe that the majority of new buyers do not pay attention to things like resale restrictions. Yes, many long-time owners do, and they probably are hurting their market a tad there with the add on buyers, but I don't think new buyers care that much.

I do think that DVC has done a few things to cause an erosion of trust: the point charts shenanigans, how the property taxes refunds were handled for resale purchases, the resale restrictions. However, at the end of the day I agree that all those things have almost zero impact.
At the time of 2020 point charts, DVC said around 2 dozens people complained. It represents 0.0096% of the membership. Has someone avoided buying Riviera because of the resale restrictions? Yes, but others have decided to buy direct because of them.
At the end of the day, we are a very vocal minority, we also live in our bubble where everything is amplified and we tend to overestimate the impact of certain things. WDW has over 50 million visitors a year. Genie+ and prices increases on churros are are more likely to impact DVC sales than questionable point charts.

 

[john7994]

As a DVC owner, nothing indicated in your post resonated with me at all and I own direct at Riviera as well as own resale. People can and certainly will have their different spins on it for a variety of reasons.

As a reasonable adult, I didn’t blindly enter into a financial relationship with a company expecting them to be only concerned about my best interests either. I am also pretty uncomplicated in preferences and tastes and I would never presume that my style should be what everyone else should like - the fact that the offering (accommodations) is varied enough and is suitable to what I want for what I purchased - inclusive of restrictions and other recently announced plans.

As with any other company on the planet - good choices will be rewarded and bad choices won’t - this isn’t a new concept. So maybe some DVC owners will need to drop out as others take over. But, I can’t get caught up in the chaos of the moment (because of the internet and social media) which gives voice to everyone that has an opinion now (well intended or otherwise).

I presume Disney plays the long view and it’s how I approach things …

 

[CarolynFH]

I wasn’t happy about the blue card - white card distinction when implemented in 2016 but accepted it as marketing for DVD, which is separate from DVCMC. I also accepted the other changes separating resale from direct that came along over the next few years. But there were other incidents that made me feel DVCMC had little respect for owners. - anyone remember when, 3 weeks beforehand, DVC announced a special 4th of July event in the TOTWL that essentially closed it to all the members who had booked stays in BLT 11 months out, specifically to watch fireworks from there?

The 2020 points chart debacle was what really affected my trust in DVC, especially because at the annual meeting just a week or two before, Terri Shultz, VP at the time, didn’t see fit to even mention that they were embarking on a multi-year plan to reallocate points to even out demand, which they are actually tasked to do, much less that they were raising points costs of studios and 1BR and lowering 2BR. I was thankful for @zavandor and others who had the skills to determine the impact of those changes and to speak up for us, although I drafted and revised multiple emails that were never sent before DVC backed down and sent out new charts.

Since then I’ve been much more wary of changes DVCMC makes, no longer trusting them to act in the best interests of owners. We still enjoy our visits to WDW and like being able to stay in the various DVC resorts, and we hope to enjoy our ownership all the way through January 31, 2042, but I pay careful attention to every new points chart and every other change that comes along.

 

[tidefan]

For me, the straw that broke this camel’s back was VGF2. It’s really impacted our ability to get DLX studios (have no interest in the hotel rooms). I never thought when we purchased back in 2013 that our VGF points would be SAP…

 

[skier_pete]

I do think that DVC has done a few things to cause an erosion of trust: the point charts shenanigans, how the property taxes refunds were handled for resale purchases, the resale restrictions. However, at the end of the day I agree that all those things have almost zero impact.
At the time of 2020 point charts, DVC said around 2 dozens people complained. It represents 0.0096% of the membership. Has someone avoided buying Riviera because of the resale restrictions? Yes, but others have decided to buy direct because of them.
At the end of the day, we are a very vocal minority, we also live in our bubble where everything is amplified and we tend to overestimate the impact of certain things. WDW has over 50 million visitors a year. Genie+ and prices increases on churros are are more likely to impact DVC sales than questionable point charts.

The 2020 fiasco! I was one of the two dozen people. (They actually told me that on the phone.) Yeah, that was awful, but had zero impact on knew buyers. And in the end whatever was the cause, they did go back on that one thank goodness. I don't like the resale restrictions but they are not the only timeshare out there that has done this, and while I would argue it has hurt them more than helped them I'm not sure if they think that. (The fact that two of the three "new" resorts since Riviera don't have the restriction makes me pause on what they actually think.)

 

[sethschroeder]

Here is the thing Disney Parks attendance keeps attracting new people because each year a new set of young kids becomes Disney age.

Essentially the abandonment would occur over a 30 year period as you need a full generation to flow through this choice.

On top of this Disney is actively courting young childless adults as well for a whole new market.

Could they see a slide? Sure but its such a massive customer base that even a slide is something they can pull out of if they are pushed to do so.

 

[Spivey378]

I trust the trust. It’s literally called a trust. How can you not trust it?

 

[RichVIII]

I can certainly say I have moved from devoted member touting to anyone who was interested how great it is. Now I present a much more cautious, heavily caveated presentation of DVC. Maybe we were foolish all those years back but I also talk to so many folks, even life long Disney fans and some of the first members and they have little idea of what is going on, nor do they seem to care. They use DVC for what it is.

 

[Rex1993]

OP, I get where you're coming from. I get real irritated by how brazenly DVD thumbs their nose at California law as it relates to the operations of VGC. That being said, I still value my points and love staying there. I also bought into VGF knowing full well that the Association with never be run compliant and I'd have absolutely no control. Sometimes it's best just to accept the fate and enjoy what you got. The best thing about DVC that separates it from every single other timeshare/points system the world has ever known is that you have a damn good chance of selling your interest for a gain a few years down the road rather than worrying about if you can find a sucker to give it away to.

 

[SL6827]

The point chart debacle, didn't they try that twice?

 

[Unclelude]

Our concern is Disney in general. OP hit on this with other segments.

I'm cautiously pleased with recent comments from Iger ( I believe he's a spinster, but still... ) Regarding content, He said something like "... we have to get out of sending a message (virtue signalling bs) and go back to great story telling"

One of the best things about Walt was he genuinely wanted to strengthen the family... He actually cared about kids .. he wanted to provide a second to none product for families to grow and have great experiences. "This is the way"

We base opinions on our visits. If the 'BS' starts to infiltrate our experiences, we will be out immediately. We just got back from a few nights in the treehouses... Happily, we haven't seen any issues with the magic going away. We had a great time.

Our fear would be like the trust premise "slowly at first then all at once" ... Disney is probably somewhere in the slowly at first, but hopefully they turn things around... I'm cautiously optimistic!

Have fun!

 

[Cfabar1]

Walt and Michael Eisner both understood if you create unbelievable experiences, and leave the customer feeling like they are experiencing something special they will gladly open their wallet, and reward your company.

Unfortunately, the business environment in today's world would make such a strategy incredibly difficult to do for any publicly traded company. The pressure is on to keep fleecing the consumer at every turn and provide short term value to the shareholders.

 

[Lorana]

Walt and Michael Eisner both understood if you create unbelievable experiences, and leave the customer feeling like they are experiencing something special they will gladly open their wallet, and reward your company.

Unfortunately, the business environment in today's world would make such a strategy incredibly difficult to do for any publicly traded company. The pressure is on to keep fleecing the consumer at every turn and provide short term value to the shareholders.

So much this.

We still love our DVC / Disney, and we leave in 2 weeks for Disneyland, head to WDW in February, and are on the DVC charter to Lighthouse Point in June, so we clearly have no intention of stopping anytime soon.

Disney was always an expensive vacation, but in its heyday the value it provided and the experiences it created were beyond compare. We fell in love with Disney because it truly took us to a new place, and the value for our money was there. We shouted from the rooftops to everyone how amazing it was.

We still love it, but the same value is not there. I do feel fleeced a lot of the times going to Disney. Everything is comparatively more expensive, the quality is less, the value is less. It’s clear Corporate Disney is looking to make a profit - and using the profits of the park for purposes other than the parks - and it’s affecting the overall experience. We still love Disney, we will still go, but we recognize it’s not what it was, and we don’t quite shout from the rooftops anymore.

Like, I’m unlikely to sell my DVC anytime soon, and I’m not likely to do so because every refurb tosses the wonderful and immersive resort theming out the window. But it does make me cry a bit inside; at the very least I can no longer shout about how even the hotel rooms transport you away. I’m absolutely terrified of what the AKV refurb is going to bring. I know some people don’t like it, but I love feeling like I’m whisked away to an African Safari Lodge. Just like with FW Cabins were I loved feeling like I was staying at a rustic log cabin in the woods, and the new theming is not in keeping with that at all.

Don’t get me started with the points shenanigans. I was also one of the people who wrote in. Not to mention, My Treehouse contract is still “off” and the Treehouse point rebalance technically means my % ownership is less - not to respark that debate, as I’ve accepted that it is what it is. But those types of shenanigans and the fact that Disney did them, does make me distrustful of what Disney might do going forward, and thus makes me scrutinize every change that occurs. Such as what point rebalance Disney might try in a few years with Poly if the Tower is part of the association. I only have 100 points with PVB, though.

Anyway, I do hope Disney sees the light again and focuses a little more heavily on wowing the customer and creating an experience we’ll shout from the rooftop about.

 

[Dismom18]

I too am about wary of what this trust entails. It took me years of analyzing to buy into DVC, only to find out now they may be changing the entire system. Can someone kindly explain to me how this trust will affect the current membership/system

 

[Mai Ku Tiki]

So much this.

We still love our DVC / Disney, and we leave in 2 weeks for Disneyland, head to WDW in February, and are on the DVC charter to Lighthouse Point in June, so we clearly have no intention of stopping anytime soon.

Disney was always an expensive vacation, but in its heyday the value it provided and the experiences it created were beyond compare. We fell in love with Disney because it truly took us to a new place, and the value for our money was there. We shouted from the rooftops to everyone how amazing it was.

We still love it, but the same value is not there. I do feel fleeced a lot of the times going to Disney. Everything is comparatively more expensive, the quality is less, the value is less. It’s clear Corporate Disney is looking to make a profit - and using the profits of the park for purposes other than the parks - and it’s affecting the overall experience. We still love Disney, we will still go, but we recognize it’s not what it was, and we don’t quite shout from the rooftops anymore.

Like, I’m unlikely to sell my DVC anytime soon, and I’m not likely to do so because every refurb tosses the wonderful and immersive resort theming out the window. But it does make me cry a bit inside; at the very least I can no longer shout about how even the hotel rooms transport you away. I’m absolutely terrified of what the AKV refurb is going to bring. I know some people don’t like it, but I love feeling like I’m whisked away to an African Safari Lodge. Just like with FW Cabins were I loved feeling like I was staying at a rustic log cabin in the woods, and the new theming is not in keeping with that at all.

Don’t get me started with the points shenanigans. I was also one of the people who wrote in. Not to mention, My Treehouse contract is still “off” and the Treehouse point rebalance technically means my % ownership is less - not to respark that debate, as I’ve accepted that it is what it is. But those types of shenanigans and the fact that Disney did them, does make me distrustful of what Disney might do going forward, and thus makes me scrutinize every change that occurs. Such as what point rebalance Disney might try in a few years with Poly if the Tower is part of the association. I only have 100 points with PVB, though.

Anyway, I do hope Disney sees the light again and focuses a little more heavily on wowing the customer and creating an experience we’ll shout from the rooftop about.

And SO MUCH THIS

 

[tom1944]

I too am about wary of what this trust entails. It took me years of analyzing to buy into DVC, only to find out now they may be changing the entire system. Can someone kindly explain to me how this trust will affect the current membership/system

I am interested in seeing how the trust will work on the resale market.

 

[CarolynFH]

I too am about wary of what this trust entails. It took me years of analyzing to buy into DVC, only to find out now they may be changing the entire system. Can someone kindly explain to me how this trust will affect the current membership/system

The truth is that we don’t know yet, because details aren’t publicly available yet. It’s possible the current system and the trust will operate in parallel, just as the Wyndham and Marriott weeks and trust systems operate in parallel.