Interesting Chat with DVC Executive Office yesterday

[disneymotherof3]

I'm wondering if the tiered plan would frustrate and alienate future purchasers. Look at the people who buy to go every other year or once a year and don't want a lot of points. Then add those who really cannot afford Disney's minimum but buy a small contract through resale. Then add the people who bought years ago, are ready to vacation elsewhere and are on the fence about keeping or selling.
I could see each of these groups feeling like second class citizens and Disney losing their business.
People who have tons of points do it because they love Disney. They will be there perks or not.
On the other hand, if the perks were offered to anyone, sales could increase as people buy in to get the benefits.

I agree.

 

[DebbieB]

I'm really curious about the "tiered" deal. I wonder how it will be set up. I understand that some people have more points than others, which in turn, IMO, means that they have more money. But does that make them more important than someone who just has the "buy-in' points? To me, no it doesn't.

For my family, when we go, we use the military ticket (DH is Active Duty) so a ticket discount isn't that appealing to us. That being said, I do think a ticket discount would be nice. Don't they offer a DVC discount already on AP's? We always use the DDP so a discount on that would be great!!

A simliar tiered plan is airline frequent flyers. For example, on Delta there is silver, gold, platnium and diamond. Silver starts @ 25,000 annual miles flown and then each tier is 25,000 miles more. People actually do "mileage runs" to earn miles to move up to a higher tier (fly with no purpose just to earn miles). With each tier, you get more benefits. When they are handing out free upgrades to first class, they start with the diamonds. Frequent flyers will pay more for an airline ticket on their favored airline because of the benefits they provide in return. In DVC's case, some people may buy an add-on just to move into a higher tier with increased benefits. As long as they don't remove benefits from people in the base tier, I don't see where it would alienate people.

 

[KAT4DISNEY]

I'm really curious about the "tiered" deal. I wonder how it will be set up. I understand that some people have more points than others, which in turn, IMO, means that they have more money. But does that make them more important than someone who just has the "buy-in' points? To me, no it doesn't.

For my family, when we go, we use the military ticket (DH is Active Duty) so a ticket discount isn't that appealing to us. That being said, I do think a ticket discount would be nice. Don't they offer a DVC discount already on AP's? We always use the DDP so a discount on that would be great!!

It doesn't necessarily mean they have more money than other owners but could mean that a person/family is committing all of their vacation time and money towards Disney. Someone else with the same amount of money may own less points b/c they do not commit all to disney. That's where a tiered program acts as an incentive - to get more or all of a family's vacation $$$'s.

 

[Lewisc]

I understand "free dining" is charged to the resort. Makes sense, it's a type of discount.

Why do people think members dues should be used to subsidize dining for some members?

Same with the tiered benefits. Is it really fair to have the dues paid by all members be used to subsidize some benefits, such as theme park discounts, for members who own a lot of points?

 

[Brian Noble]

Ugh - sorry, but I'm so tired of hearing DVC owners spout this out. Why? Because a business should provide good service to its best customers.

Well, as it happens, I'm not a Member, for a variety of reasons. It doesn't change the fact that it is true though.

I happen to go to Quizno's near where I work 3 or 4 times a week. So, I'm not just a regular, I'm an uber-regular. Do they ignore me and take for granted they have my business, no they treat me nice and occasionally throw in a free drink or sandwich upsize for me....it's treatment like that that keeps me coming back as often as I do.

But each of those 3-4 visits a week is an individual purchase decision. Each of your DVC stays is not---the purchase decision was made once, up front. It is true that brand loyalty is a form of "stickiness"---people prefer to stay with the familiar---but each day you have the free choice of where to get your lunch, and *that's* why it is important to try to retain those customers. Because, once you lose them, getting them back is *much* more expensive. Now, if you *prepaid* for 40 years worth of sandwiches, then we'd be much closer to an apples-to-apples comparison.

I'm wondering if the tiered plan would frustrate and alienate future purchasers.

Not if it is handled properly. Lots of other companies do this---both in the timeshare world, and in other industries. In the timeshare world, many of the other systems have some benefits that accrue to owners who own more time, but not to those who own less. Everyone is a "valued owner", but some owners are more valued than others, and resale owners are valued least of all. A few people may be turned off by it, but if enough other people are motivated to reach for that next level of ownership, then it is a net win. And, given the fairly widespread adoption of these schemes, either it really is a net win, or all of these other companies are incompetently run.

Look at the people who buy to go every other year or once a year and don't want a lot of points. Then add those who really cannot afford Disney's minimum but buy a small contract through resale. Then add the people who bought years ago, are ready to vacation elsewhere and are on the fence about keeping or selling.
I could see each of these groups feeling like second class citizens and Disney losing their business.

But, what does it mean for Disney to "lose their business"? For existing Members, there are really only two options.

Option one: those guests use one of their exchange options to vacation elsewhere. But, in turn, some *other* timeshare owner visits Disney instead of using their home resort (if using RCI or BVTC), *or* Disney rents the room out to someone (if using the Disney Collection, DCL, or ABD). This is probably a net win for Disney, as the infrequent guest tends to spend more per visit than the frequent visitor. But, the original purchaser still paid for (and is paying for) DVC.

Option two: those guests put their contracts up for sale. Well, we know how Disney feels about that---they don't like it, because it means someone who might have purchased direct can purchase from someone else instead. In fact, they don't like it so much that people who buy such contracts now can't use them for DCL, ABD, or the Disney Collection hotels. And, if that's not enough to nudge people back to direct purchases, well, you can bet that Mickey will think about other ways he can devalue a resale purchase, because the genie is out of the bottle.

The neat side effect of devaluing the resale contracts? Fewer people put their contracts up for sale, because the return is lower. If you'd only get a small amount back for selling it, well, maybe you'll just try to make some use out of it instead. That's pretty Machiavellian, but don't put it past Mickey. He's only in it for the cheese.

For prospective members, this probably isn't a negative on the sales floor. You're already being sold magic in a bottle---"Keep this vacation feeling, year after year!"---it's not that hard to also think that, you know, today I won't make that tier, but as my finances grow, I can reach that next level! But, if it does turn some people away, the people you turn away are the lower-margin customers, and that's probably okay *if* you get enough high-margin customers to more than make up for it.

I understand that some people have more points than others, which in turn, IMO, means that they have more money. But does that make them more important than someone who just has the "buy-in' points? To me, no it doesn't.

It doesn't necessarily mean they have more money. It *does* mean they've given more money to Disney though. And, from Disney's perspective as a for-profit company, that does make them more important---they represent a greater portion of shareholder value.

I've said this a lot lately, but it bears repeating. Disney does not care about my happiness, except insofar as it leads me to give them more of my money. Sometimes, Disney's goal of profit and my goal of happiness are in alignment, and we both get what we want. But, if Disney has to choose between its profitability and my happiness, why Disney will choose profit, every single time.

Is it really fair to have the dues paid by all members be used to subsidize some benefits, such as theme park discounts, for members who own a lot of points?

Most other systems that do similar tiered perks pay for them out of the sales budget, not the operating budget. In fact, I suspect that's a legal restriction. So, it would come from DVD (purchase costs), not DVCMC (dues).

 

[Brian Noble]

One more thought. It is possible that even *if* the *direct* profit/loss statements get better with a tiered scheme, that Disney might not go forward with it. More so than most other companies, Disney highly values customer goodwill. Some things other timeshare companies do are more profitable, but tick off their customers. For them, that's a win. For Disney, it wouldn't be. So, this isn't necessarily a straight money decision.

As an example: the original justification of Fastpass is that when guests were not in line for an attraction, they'd be buying food or merchandise instead, and the per-capita spending numbers would go up by more than enough to offset the extra costs of deploying and operating fastpass. But, we all know that's not what happens---they just get in line for some other ride. And, the financial statements seem to confirm this---there was no unusual jump in in-park spending when fastpass was first deployed. In fact, if you look across the amusement park landscape, it seems clear that everyone has come to that same conclusion. Every park operator that had some form of free "virtual queueing" (Cedar Fair, Universal) has since abandoned it---Cedar Fair got rid of it entirely, and Universal switched to a scheme you have to pay extra for. Every park operator that has used some form of paid "virtual queueing" has expanded its use---Six Flags, Universal, Herschend, and the Busch/Sea World parks. Cedar Fair is now experimenting with it as well. Yet, Disney's version remains free for all, despite the fact that doing so is leaving money on the table---possibly, a LOT of money. That's a strong testament to the degree to which Disney values goodwill.

 

[moericus]

When I joined DVC, I just assumed we were all able to get discounted park tickets. I researched a lot of other perks, but never checked to see the discount only applied to APs.

I doubt an AP would ever make sense for me. I live too far away and prefer to spend my summer vacation at the beach.

 

[A_Princess'_Daddy]

I'm really curious about the "tiered" deal. I wonder how it will be set up. I understand that some people have more points than others, which in turn, IMO, means that they have more money. But does that make them more important than someone who just has the "buy-in' points? To me, no it doesn't.

For my family, when we go, we use the military ticket (DH is Active Duty) so a ticket discount isn't that appealing to us. That being said, I do think a ticket discount would be nice. Don't they offer a DVC discount already on AP's? We always use the DDP so a discount on that would be great!!

I agree that having more points alone doesn't make somebody "more important" in life or in the world, but it likely does make them more important to WDW's bottom line, and therefore potentially more worth rewarding with added benefits.

It's a similar type of judgement that WDW uses to reward those who serve in the military with lower priced tickets, over those people who work in other professions that also serve the greater good and are not highly compensated, such as teachers, ministers, social workers, firefighters, farmers, etc. They're not saying that those professions are not important or that the military is more important, but merely that they as a company made a choice to thank the military with a perk.

A tiered benefit system thanks those who have invested more in WDW's bottom line with additional benefits.

 

[WDWMom]

Well, for starters, a 10% discount on admission would have a non-trivial impact on the per-capita spending numbers in the quarterly and annual reports. It's a good year when per-caps go up a percentage point or two faster than inflation. Mickey generally won't discount the gate unless there is more cheese in it for him somehow.

But, why would the Parks division do this for DVC? What is in it for them? Not much----unless DVC pays them for the privilege. Where does DVC get *that* money? Well, new point sales could be one source. And that's why I think it would have to be tied to the tiered benefit program.

The multi day tickets - what is in it for Disney? OK so some people buy food, but not everyone. I have a kitchen in my villa. No money going to Disney. We don't buy souvies either. So that discount I am getting on my multi-day ticket is costing me an extra something, but Disney is getting nothing.

Maybe we are the only family getting something for little, but I highly doubt it.

Maybe DVC members are not going to the parks as often as they have in the past? I know this board is not a statistical sample, but we certainly do see more people talking about non-park vacations than they have in the past. Especially if Disney doesn't plan on investing into major new attractions like Universal recently did, they may want to test the ticket discounting.

Just a thought, but on the whole I agree that we probably shouldn't expect much in the way of new perks unless it is tied to a tiered system.

We've done no park vacation at WDW. I'm sure we'll do them again. OKW has tons of stuff for us to do without leaving. Or going and visiting other resorts. Love to do that.

I hope it's a discount on park passes!! That would be wonderful.

I agree

We (me, DH, and DS15) lose money on dining plans. Not just a little money, either. I am talking we get HOSED on dining plans. I have compared what we pay out of pocket with a TIW card against what we would spend on DxDDP over the same amount of days and I am not joking when I say the cost is over a thousand dollars more for the plan. Last year we considered just doing the counter service plan, but at the last minute decided NOT to get the plan and just track our spending on counter service and snacks really closely to see if the plan would be worth it in the future. The plan would have cost DOUBLE what we actually spent.


If they discounted the plans I bet I would try even harder to figure out a way to make the dining plans work for us.

We've done the number several times too. Never worth it.

I understand "free dining" is charged to the resort. Makes sense, it's a type of discount.

Why do people think members dues should be used to subsidize dining for some members?

Same with the tiered benefits. Is it really fair to have the dues paid by all members be used to subsidize some benefits, such as theme park discounts, for members who own a lot of points?

So then I am subsidizing all those DVC AP's? Crap, that's not fair.

Well, as it happens, I'm not a Member, for a variety of reasons. It doesn't change the fact that it is true though.


But each of those 3-4 visits a week is an individual purchase decision. Each of your DVC stays is not---the purchase decision was made once, up front. It is true that brand loyalty is a form of "stickiness"---people prefer to stay with the familiar---but each day you have the free choice of where to get your lunch, and *that's* why it is important to try to retain those customers. Because, once you lose them, getting them back is *much* more expensive. Now, if you *prepaid* for 40 years worth of sandwiches, then we'd be much closer to an apples-to-apples comparison.

Our initial purchase by have been made once, but each time we go into the parks or spend money at WDW is an individual purchase. I'm a loyal user of my DVC, but am not a loyal spender at the parks. I have the free choice to spend money at the parks or not.


But, what does it mean for Disney to "lose their business"? For existing Members, there are really only two options.

Option one: those guests use one of their exchange options to vacation elsewhere. But, in turn, some *other* timeshare owner visits Disney instead of using their home resort (if using RCI or BVTC), *or* Disney rents the room out to someone (if using the Disney Collection, DCL, or ABD). This is probably a net win for Disney, as the infrequent guest tends to spend more per visit than the frequent visitor. But, the original purchaser still paid for (and is paying for) DVC.

Option two: those guests put their contracts up for sale. Well, we know how Disney feels about that---they don't like it, because it means someone who might have purchased direct can purchase from someone else instead. In fact, they don't like it so much that people who buy such contracts now can't use them for DCL, ABD, or the Disney Collection hotels. And, if that's not enough to nudge people back to direct purchases, well, you can bet that Mickey will think about other ways he can devalue a resale purchase, because the genie is out of the bottle.

Option three: Vacation in my DVC and not go into the parks. Been there, done that. Not that we have ever left property during our stays, but many other have.


Most other systems that do similar tiered perks pay for them out of the sales budget, not the operating budget. In fact, I suspect that's a legal restriction. So, it would come from DVD (purchase costs), not DVCMC (dues).

 

[DebbieB]

So then I am subsidizing all those DVC AP's? Crap, that's not fair.

I don't believe that's true and will not be in the future. Dues have to be used to pay for the operation of the resort. I don't think legally dues could pay for discounted tickets.

 

[n2mm]

I wonder what % of member reservations add the dining plan? For myself, I have not used it in 5 years. We just don't spend that much on food. But if they throw in a $5 or $10 per day discount, I might go for it. I would still be paying a little more than out of pocket but it would be worth it for the convenience. The price now is just too much more.

They offer the CMs a great discount on the dining plan certain times of the year. Generally it's the basic ddp for about $20 a night. (At least that's what my CM friend told us in January when she and her DH booked a room for the weekend.) While I wouldn't expect CM prices, 25% off a night would be good for me. We generally stay with our TiW discounts, but I've been known to add the ddp for the first night of our stay just to get the mugs (QS or DexDDP)

 

[M&C]

I'd be happy with just discounted tickets for DVC. Actually, a 3 or 6 month pass would be awesome. Since most DVC members usually go once a year, they can still take advantage of the park hopping component and get discounts on merchandise. I heard from somebody who bought DVC very early on that you got FREE annual passes every year. I was already too shocked to bother asking how many they got.

 

[DebbieB]

I'd be happy with just discounted tickets for DVC. Actually, a 3 or 6 month pass would be awesome. Since most DVC members usually go once a year, they can still take advantage of the park hopping component and get discounts on merchandise. I heard from somebody who bought DVC very early on that you got FREE annual passes every year. I was already too shocked to bother asking how many they got.

That's not true. You got length of stay passes for the number of nights (not days) you were staying for half of the maximum room occupancy. So if you had a studio or 1 bedroom, you got 2; 2 bedroom you got 4; GV you got 6. This was only for OKW members who bought before early 1996. It was spelled out in the contract that it was only available until the end of 1999, so it was a sales incentive, not a "perk".

 

[Rest&Relax]

We would love to see a discounted park pass be added as a perk besides the an AP. DH & I usually buy an AP, but if we take someone else with us then a discounted ticket really helps out for their stay.

One perk I never seen passed around that I would love, is to make ADR's sooner than the 180 day before anyone else can book theirs. This perk would not cost DVC anything. Booking the CP or a signature restaurant before everybody else, now that would be nice perk for me.

 

[Chuck S]

We would love to see a discounted park pass be added as a perk besides the an AP. DH & I usually buy an AP, but if we take someone else with us then a discounted ticket really helps out for their stay.

One perk I never seen passed around that I would love, is to make ADR's sooner than the 180 day before anyone else can book theirs. This perk would not cost DVC anything. Booking the CP or a signature restaurant before everybody else, now that would be nice perk for me.

I think this perk would actually cost DVC a pretty penny. The dining reservation software used by the entire WDW complex would need to be modified.

 

[Buckeye Fan]

Park pass discounts and TIW! If I remember correctly, I thought I read that FL residents could purchase a TIW card without having to purchase an AP. If that is correct, I don't understand why we can't buy those, too, sice we have deeded property in FL! I know it's not apples to apples, but hey, I am on the comptroller's website!!!

 

[maminnie]

As I recall when we joined 10+ years ago, DVC members use to get a percentage off for length of stay passes....wasn't it around 10%??

Anyone remember this too?

 

[Chuck S]

Park pass discounts and TIW! If I remember correctly, I thought I read that FL residents could purchase a TIW card without having to purchase an AP. If that is correct, I don't understand why we can't buy those, too, sice we have deeded property in FL! I know it's not apples to apples, but hey, I am on the comptroller's website!!!

Disney does not consider DVC Members to be Florida residents, and legally, they aren't by virtue of their timeshare ownership. Any more than a business owner is a resident of the town where their business is located, unless they also live there. They pay taxes, but are not residents.

Actually, the TiW has only been available to all AP holders for a relatively short time. The TiW (originally Disney Dining Experience) was designed as a discount card for locals, to encourage them to dine more often on Disney property when looking for a night out, or entertaining clients for a business dinner. It was only available to Florida residents for many, many years.

Disney could certainly let DVCers purchase the TiW, if they choose to do so, but DVCers do not qualify as a resident.

 

[homedad]

sounds good, hopefully some will pan out

 

[arthur06]

I wouldn't mind seeing the current AP deal left alone, but with a modification that you can bill it monthly. I would love to split out the cost of AP's over 12 months rather then dropping $2,000 all at once.

If dues can be paid annually or monthly, why can't park tickets?