Why Disney would like you to subscribe to vacations

“I’m only here for the Fast Passes.” That is what I unashamedly told the consultant trying to pitch us on Disney’s Vacation Club. We had been at Walt Disney World and while we were waiting for something such as children cycling through a bathroom run, we had wondered what all of the “enjoy your vacation for 70% off, ask us how” posters were all about. Standing right there was an appropriately uniformed person to ask them how. He said lots of stuff but I wasn’t really paying attention. But then he said, if you’d like to hear all the details, it will take about an hour but in return Disney will give you enough Fast Passes for the day. From then, I was all ears (pun intended).

A Fast Pass is Disney’s ingenious method of allowing theme park visitors to spend less time in queues. They usually work by turning up to a popular ride, grabbing a pass which then gives you an hour window to queue skip at some time later in the day. You can only hold one of these at a time so they have to be used sparingly.

But the Fast Passes on offer here were not of that variety. They could be used right away. And there were enough of them that we would be free of queues for a day. It didn’t take me long to work out that that would save us a couple of hours in queuing. So I’d happily trade-off hearing a sales pitch on the Disney Vacation Club for that any day. I may even get a blog post out of it.

To that end, despite my clear and transparent motivations for being at the pitch, I paid attention. At our scheduled time, we were brought the Disney Vacation Club installation at Walt Disney World. This was a large facility that was part of the Saratoga Springs Resort. We were led to a consultation room with its appropriately Disney styling and we were given the deal. Here’s what it was. Instead of paying for vacations — specifically accommodation — as we currently did, when we booked them, we could pay for them in advance. For either a one time payment or a ‘mortgage’ over 10 years (or it turns out anything in between), we would get 50 years of holidays. Yes, 50! For we who were currently involved in heavy planning of our activities over the next 50 hours, this was quite an adjustment in time horizon.

Now you might say that this just sounds like a ‘time share.’ A traditional time share is where you buy a 1/52nd share in a property somewhere and you are required to vacation during a specific week each year. For those, more popular weeks carry higher payments but you do get some real estate in the process. This has never been too appealing a notion to us as we never found a place we would be happy with to vacation every year and there just seemed to be too many things that may change our minds even if we did.

The Disney Vacation Club is ‘time share’ like in that you get ‘time’ and you are ‘sharing’ but that is about it. Instead, while legally you are buying a share of a property, in actuality, Disney has set up an organized market over the top of it that allows you to vacation at some 200 possible locations (near as I can count) at any time of the year you want. Now, it is subject to availability but when you are encouraged to book several months in advance, that isn’t an issue. And there is a ‘rate of exchange’ based on your primary buy-in. What that means is that you purchase points and Disney assigns different redemption amounts for points at different properties and at different times of the year. Want to vacation at more deluxe accommodations, buy more points. Want longer vacations, buy more points. In economic terms, you are paying for the rights to a certain amount of vacation quantity/quality at Disney resorts.

But it is even better than that. First, if in one year, you don’t want to do that, you can bank the points and have a longer vacation next year. Second, if you are impatient and want a longer vacation this year, you can borrow from next year’s allotment. Third, this isn’t tied to you. You can gift vacations to friends and family and indeed, leave the future vacations to your children and perhaps your children’s children. If it is at a Disney resort they get all the resort privileges too. Finally, you aren’t confined to Disney resorts. Disney has done deals with others so that you can choose places to go all over the world. To be sure, the redemption rates are higher for those but if you want to go to Australia, paying in advance in this way isn’t going to cause you a dilemma.

What about the financials? Now I won’t go into the details as that borders on financial advice that I am not in a position to give. But the demonstration of the costs and benefits was crystal clear in the pitch and stood up to my probing questions. If you are the sort of person who pays full price for vacations, you can, indeed, save 70 percent on accommodation but probably only if being a Club member turns you into the person who would plan for vacations and take advantage of discounts. Instead, for us, I believed it would have saved us 50 percent on what we paid for this year. That means that the Disney Vacation Club would pay for itself in 7 to 9 visits. Although it also would save me the days of planning for a vacation and researching options. Once you bought it, there’d be no reason to stress over that anymore. All that said, if you want to learn more about that I recommend this grumpy blog post from 2007.
What I would say is that the financing option offered by Disney wasn’t too attractive at 12.5% APR for we Australians. That said, there was apparently no credit check required for non-US and non-Canadian citizens. For Disney you can’t exactly make a few payments and run off with the property so they don’t act as if you can. That was refreshing. I had never seen a financial option where foreigners were treated better.

Finally, your points can be resold to anyone (with a few minor restrictions). But it has to be officiated by Disney and they have a ‘right of first refusal’ to buy the points back at the price you may have negotiated. This is probably done to stop people trading just for individual year vacations but if you were a Club member you would probably appreciate Disney’s oversight on asset value depreciation. It can’t exactly hurt. You either resell the rights to whomever you have negotiated with or to Disney.

As I sat there listening to this, it all seemed too good to be true. What were Disney getting out of this? The consultant told us that Disney were doing this because their customers asked for it. That I didn’t doubt. And then he went on to tell us that Disney weren’t really getting anything out of it and that is why they made it work so flexibly. As I sat there in the considerable Disney Vacation Club installation, I doubted that. But I’d get no help from the consultant. I’d have to work that one out for myself.

So here goes. The first place my keen economist senses takes me is to tax. Is there some tax advantage to all of this? The answer is, probably yes. When you stay in a hotel or resort in Florida, Florida charges a whole lot of taxes for that accommodation. But when you buy into Disney Vacation Club you are buying real estate. That may involve some taxes but they appeared to be far less than the 12 or 13% tax that was running in Orlando.

But taxes weren’t getting us the whole way. If our vacation accommodation costs were halved, the real value had to be greater than that for Disney to get their cut.

The second place I looked was in capital budgeting. Disney build resorts. They are high quality and expensive. So they face an issue of forecasting demand. If you can get people to buy in early, you get those capital costs funded upfront. That sounds attractive but remember, it is more costly for me to get money to pay for Disney’s capital costs than it is for Disney. So that is a negative. But if Disney can improve the risk profile of their investments because some demand is assured, then that does get them something. But something tells me that this wasn’t going to be a huge benefit.

The third clue is that accommodation costs are just a part of what we spend on a holiday. You might want to stay a few more days but here Disney will allow that for a 25% discount (which is about as good as it gets). There are airfares but Disney don’t share in that. More importantly, there is food and activities. At Disney resorts these are considerable. There are park fees, food and Disney paraphernalia. Of course, if you were to come every year, you’d likely economize on these. Now Disney could, of course, discount its own accommodation to encourage more visitors and this stream of cash (you know, they way movie theatres try to encourage popcorn sales by getting more people through the door). But lower priced accommodations, may screen for the cash constrained. Instead, if you have customers who have paid in advance for their accommodation, they may be more liberal in their spending; especially, if they are friends and family who didn’t have to fork out for that at all.

In the end, taxes, capital planning and extra spending, all could explain part of the value but my guess is that there was something else. I went so far as to read the contract about all this which was the most beautifully clear legal document I have ever read. Two pages, no fine print. From my examination, there didn’t appear to be anything sinister hidden there and a good search of what was written on the web didn’t uncover any broad disgruntlement. Instead, we have 20 years of the program, 145,000 odd club members (encompassing perhaps up to half a million people) and Disney Vacation Club sales points at regularly spaced as bathroom facilities at Disney theme parks and hotels. All that points to Disney and its customers getting something from all this even if I couldn’t quite parse it during my own vacation time. To add to all this, Disney gives you it all back in taking the pitch.

And what did the children do while we were listening to all this? Disney, of course, had that covered. There was a big activity center and the kids happily played for an hour and when we came to pick them up with “Let’s go to the Magic Kingdom” they all said (even the 13 year old!) “do we have to?” Well, yes, but not before they were parcelled out the door with an ice cream sundae.

I came for the Fast Passes but the pitch was worth hearing even if you weren’t writing a post about it. It will cost you at most an hour which you make up for in reduced queuing and your kids will be more than happy for the fun.

Joshua Gans Contributor

I write about economics and parenting with a touch of technology.

 

Dial An Exchange Partners with Oombaga to Provide Mobile Exchange Applications

Dial An Exchange (DAE), the world’s largest independently owned vacation exchange company, has recently become the only international exchange company to partner with Oombaga, a direct to-owner mobile platform that connects timeshare owners to their resorts.
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Commented Fermin Cruz, Vice President America’s Region for Dial An Exchange, “We totally share Oombaga’s vision for making timeshare ownership more manageable, simple, and equally important … mobile. Their transactions provide an instant and seamless user experience. Our intention is to ensure that DAE’s services are available to anyone using their platform.”

“Owners utilizing Oombaga software have the ability to pay maintenance fees, deposit weeks, and make other transactions, including reservations and exchanges via any online and mobile device,” says Delaina Probus-Staley, founder of Triton Timeshare Software, which created Oombaga. “We are a ‘middleware’ company that enables entities serving a similar industry to ‘talk to each other’ and connect through a single interface.” Oombaga was honored at the American Resort Development Association’s (ARDA) World Convention with their annual Ace Innovator Award.

Because DAE does not employ a typical affiliation model, consumers are free to utilize their services to conduct a direct exchange. Other exchange companies require payment of a membership fee, outstanding maintenance fees, exchange fees and the time-consuming determination of the timeshare’s value before an exchange can take place. DAE offers a free membership option; exchange fees are not charged until an exchange is confirmed.

Adds Cruz, “Our only requirement is that maintenance fees are paid. Using Oombaga, owners simply download the app, touch the screen and deposit their vacation time, review available inventory, and ultimately conduct an exchange. It’s that easy.”

DAE has been working diligently with Oombaga (www.oombaga.com) for over a year to implement this program. “The initially complicated aspect of the alliance admits Cruz, was being able to communicate directly with owners. Using their mobile platform is another step we are taking to ensure that DAE’s services are available to any timeshare owner. We anticipate a long and mutually beneficial relationship with the Oombaga team and are delighted to see this amazing technology in play!”

With eleven offices worldwide and almost half a million members, DAE has enjoyed dramatic growth within the vacation ownership industry. As a new generation of owners and a new secondary market becomes available, providing choices, options and excellent service means more to the success of the industry than ever before.

 

Dial An Exchange Makes Timeshare Exchanging Easy

Dial An Exchange (DAE), the world’s largest privately owned timeshare Exchange Company continues to innovatively make booking a timeshare vacation easier for timeshare owners.

DAE understands that many timeshare owners believe that they are tied into the exchange company affiliated with the resort where they purchased their timeshare membership. However, as this is not the case, Dial An Exchange is committed to educating timeshare owners, and providing a simple to use alternative, giving consumers the power of choice when it’s time to book their vacation.

Exchange services are a major purchasing factor, giving vacationers the opportunity to explore thousands of destinations around the world by exchanging the time owned at their destination for time at another destination out of those available through a timeshare exchange company. When a preferred destination is unavailable through the affiliated exchange company, many timeshare owners believe that they must choose a different destination, not understanding that they could also check availability with other exchange companies, such as Dial An Exchange to see if the destination or specific resort they are looking for is available through another provider.

DAE makes it an easy choice for timeshare owners, offering free membership that gives access to availability, and only requiring payment for an exchange once it is confirmed. This enables any timeshare owner that usually uses another exchange company, to also check for options with DAE without cost, or risk to their owned timeshare weeks or points.

DAE currently provides free memberships to over 450,000 members worldwide, providing an array of member benefits including excellent rental options, discount promotions, travel services and outstanding customer service.

With DAE’s convenient online system members can plan travel arrangements, make destination requests, search availability and book instantly. Members are able deposit their week into the exchange system with no upfront cost, and only pay for their exchange at the time of the actual confirmation.

Singapore Hits Timeshare Sector

Yesterday four global shared ownership firms jointly issued a statement to Singapore’s Straits Times regarding a proposed new government amendment to consumer laws.

Thailand’s Anantara Vacation Club, Interval International (II), RCI and Wyndham Vacation Ownership are crying foul over a possible change, which would disallow the collection of payments during the mandatory 5-day cooling off period following a sale.

The Straits Times published article yesterday, which said that complaints over timeshare and other alternative ownership programs were a leading source of complaints with the Consumer Association of Singapore.

Comments from the four industry players said that potential financial fall-out could be enormous if companies were unable to effectively close deals at the time of transaction through a deposit process, as it would allow buyers to easily walk away from deals.

Thailand has a consumer code, which necessitates a cooling off period for timeshare transactions.

Published by The Phuket Insider

Wyndham® Extra Holidays Invites Travelers to Share Their Vacation Photos on Facebook for a Chance to Win a Resort Stay

As summer vacations wind down and kids are getting ready to go back to school, Wyndham® Extra Holidays, a subsidiary of Wyndham Vacation Ownership , the world’s largest vacation ownership company and member of the Wyndham Worldwide family of companies, asks families to share their best summer vacation photo for a chance to win the grand prize of a 7-night resort stay. To enter, simply become a fan of Wyndham Extra Holidays on Facebook and submit a family-friendly photo of your summer adventure.

Once you have entered, “share” your entry with family and friends on Facebook, so they can help you win by casting their votes for your photo. Photo submissions can be made through August 19 with voting running August 20 through September 9. The top three photos which receive the most votes will win first, second and third place, respectively. Wyndham Extra Holidays will notify the winners on September 10. View Official Rules for complete entry and voting details.

“We are thrilled that we can salute this year’s summer vacation memories with the Wyndham Extra Holidays Snapshots of Summer Photo Contest,” said Paul Carney, vice president of resort operations and rentals, Wyndham Extra Holidays. “With more than 100 resorts across the U.S., a memorable vacation with Wyndham Extra Holidays is just a click away during any season.”

The Snapshots of Summer Grand prize is a 7-night stay, second prize is a 5-night stay and third prize is a 2-night stay, all within a one-bedroom suite. Winners can choose from any of the more than 100 resorts offered by Wyndham Extra Holidays in the most popular vacation destinations throughout the United States, Canada, St. Thomas, Puerto Rico and Fiji, including Wyndham Bonnet Creek Resort in Orlando, Fla. or Wyndham Grand Desert Resort in Las Vegas or WorldMark Taos in Taos, N.M. Retail value of the prizes range from $56.00 – $2,114.00 depending on prize won, resort chosen and travel dates selected.

Wyndham® Extra Holidays specializes in offering quality vacation accommodations throughout the United States, including Hawaii, the U.S. Virgin Islands, Canada, Fiji and Puerto Rico. Wyndham® Extra Holidays is a specialized, resort condominium rental operator and a part of Wyndham Vacation Ownership, which is headquartered in Orlando, Fla. A subsidiary of Wyndham Worldwide, Wyndham Vacation Ownership is the world’s largest vacation ownership business, as measured by the number of vacation ownership resorts, individual vacation ownership units and owners of vacation ownership interests.

3.5 Million Reasons Why INTUITION Is A Game Changer For The Timeshare Industry

INTUITION, a brand marketing service launched in February 2013 by Perspective Group, the leading global PR and Multimedia company for the timeshare and vacation ownership industry has revealed the results of a simple search report on Google.com demonstrating the significant impact their service is having.

Through their unique combination of traditional PR methods with modern online marketing strategies, INTUITION has turned just over 100 official press releases written for clients into more than 3.5 million pages of content currently indexed by Google.com.

The results of this report can be here

“The impact of INTUITION is outstanding in many ways, but creating this many new searchable pages of content via Google that positively represents timeshare companies, undoubtedly also impacts on the reputation and perception of the timeshare industry as a whole.” Said Paul Mattimoe, President & CEO, Perspective Group.

INTUITION’s Social Media Monitoring platform is also tracking numerous timeshare industry keywords and market segments and plans to release free detailed reports and analytics later in the year that will give valuable insights into consumer trends and conversation topics about the various vacation ownership product types.

INTUITION has already accumulated a database of nearly 1 million verified and segmented “timeshare” online mentions spanning the last two and a half years and is currently adding more than 100,000 mentions per month for a variety of industry related search terms. This data will serve as a historical timeline with thousands of filtering and comparison options.

INTUITION specializes in the promotion and brand reputation management of resort developers and vendors operating within the timeshare and vacation ownership industry, offering a unique mix of traditional PR services, print advertising, online marketing and social media marketing, backed with the business intelligence of its own social media monitoring platform capable of highly complex tracking and competitive analysis – all operated by the global leader in PR and Multimedia for the timeshare industry.

For more information of the benefits of the INTUITION brand marketing service visit their website.

 

Wyndham Scoops the Pool at Annual Timeshare Industry Awards

The region’s leading vacation ownership company, Wyndham Vacation Resorts Asia Pacific swept the pool at last night’s 22nd annual Australian Timeshare and Holiday Ownership Council (ATHOC) Awards by scooping no less than eight of the 15 coveted awards on offer.

Winning accolades ranging from Corporate Performer of the Year and Marketing Manager of the Year to Industry Innovation and Excellence in Service, Wyndham Vacation Resorts Asia Pacific’s impressive haul helps solidify the company’s position as industry leader.

Wyndham were honoured with the following eight awards:

  • Corporate Performer of the Year – Kaleena De Voigt, Operational Excellence Leader, Consumer Finance
  • Marketing Manager of the Year – Paula O’Gorman, Holidays by Wyndham Manager
  • Marketing Team of the Year – Holidays by Wyndham
  • Resort Manager of the Year – Nola Daniel, Resort Manager, WorldMark Resort Ballarat
  • Sales Manager of the Year – Melissa Chester, Sales Manager, Owner Enhancements
  • Sales Performer of the Year – Tullika Deswal, Sales Representative, Owner Enhancements
  • Excellence in Service Award – Candice Dittmann, Office Administration Manager, Wyndham Vacation Resorts Coff Harbour
  • Industry Innovation Award – WorldMark South Pacific Club’s online tool, My Assistant

Clearly pleased by the recognition his company received, Wyndham Vacation Resorts Asia Pacific CEO and Managing Director, Barry Robinson said it was an honour for the company to be recognised for making a significant contribution to the industry.

“I’m very happy to see that our dedication to customer service, innovation and industry development is working and being recognised,” Mr Robinson said.

Created to recognise the achievements of outstanding individuals and teams who have gone above and beyond and lifted the profile of the vacation ownership industry, the ATHOC Awards are peer-nominated and nationally judged. With only one nominee permitted per company, per category, ATHOC awards are a prized and prestigious accolade presented to the standout performers of the industry.

Dial An Exchange Offers Members More Holiday Choices through Options Program

Dial An Exchange (DAE), the world’s largest, privately-owned timeshare exchange company broadens its exchange membership platform through its ‘daeOptions’ program.

In an effort to provide exchange members with a greater selection when planning their holiday, DAE implemented the ‘daeOptions’ program to provide more accommodation possibilities in high demand areas around the world where there are very few or no timeshare resorts available.

The ‘daeOptions’ program aims to supplement DAE’s already impressive timeshare resort accommodation portfolio by providing non- timeshare properties such as hotels and resorts to its members in sought-after locations. These properties are available to book by DAE members at extremely attractive rates, generally better than what would be available in the open market.

DAE’s Business Development Manager for the Pacific, Gary Fog said “The DAE Options program is all about giving our members more out of their DAE membership; the program provides a variety of holiday options at non- timeshare properties in some of the most popular destinations, located both domestically and Internationally at very competitive rates not often found in the open market arena. With almost unlimited choice via the internet, savvy consumers are now more than ever spoilt for choice with holiday accommodation, it is a very competitive market space and it is why we developed our ‘Options’ program to deliver real value to our members. It is exciting to see the program continue to grow to include some major hotel brands, and to be able to offer our members a choice of destinations that were previously only ever available outside of their timeshare ownership”.

According to recent Australian annual tourism statistics, the most popular tourism destinations in Australia are Sydney, Melbourne, Brisbane, Perth and Gold Coast, with the majority of international tourism revenue coming via visitors from China, United Kingdom, New Zealand and USA. There are very few timeshare resorts in the major cities, so offering these locations to members at competitive rates is where the daeOptions program really comes to the fore.

The higher value of the Australian Dollar has also increased aspirational travel by Australians, who in addition to taking holidays in nearby New Zealand, are now showing significant increases in the number of travellers visiting Thailand, other far reaching areas of Asia and the United States.

The daeOptions program strives to seek out demand for popular destinations worldwide and supplement a member’s existing timeshare exchange opportunities with further accommodation choices.

Vacation Home Purchase vs. Timeshare Ownership

Sales of vacation homes were up 10 percent last year — accounting for 11 percent of all home sales — according to the latest figures from the National Association of Realtors. But while vacation home sales are on the rise, Fitch Ratings reported that U.S. timeshare purchases dropped again last quarter.

As consumers look to purchase a piece of paradise, how do they decide between an investment in full-time or part-time ownership — and why might the popularity of timeshares be waning?

Though a seemingly affordable way to get into the vacation property market, timeshares are not always a wise investment. As the CEO and Founder of VacationHomeRentals.com, I’m sharing the top benefits of purchasing a vacation home versus a timeshare:

1. No flat maintenance fees – Most timeshares require owners to pay annual maintenance fees that run at least $400 and increase every year of ownership- in addition to the mandatory fees for use of amenities at the resort. With private ownership, the expenses are more tied to the property and can be managed and controlled by the owner. The upkeep on a private rental property can also be expensed during tax time.
2. More personal – By purchasing a home, owners can make the space personal by choosing paint colors or decorating to fit the style of future renters and their own personal preferences. Typically with timeshares, the home can’t be altered unless all other co-owners are in agreement.
3. Flexibility – The selected weeks are rigid and if you need to adjust schedules, it is nearly impossible to swap. Certainly during high season, timeshares book up quite quickly and often only non-desirable locations are available. However with private ownership, you call the shots on the weeks that you want for use and the weeks that you wish to offer up for rental use.
4. Resale Value – If your home is near the water, well kept, or in a desirable location selling is typically favorable- especially over the long term. However, timeshare resales typically result in low prices and take a long time to offload.
5. Time to buy is great – With many popular areas like Florida and California working off inventories of foreclosed homes, historically low interest rates, and the economic outlook brightening, many would-be investors are ready to take advantage of a great vacation home real estate market.

Do you think purchasing a vacation home is a better option?

Tom Gilmore

Strong timeshare sales in Europe, new study reveals

A new study commissioned by The Resort Development Organisation (RDO) reveals strong timeshare sales in Europe, despite the ongoing recession.

According to the latest research, European sales totalled approximately €750 million last year, and the study also highlights a new trend towards shorter term timeshare products.

RDO unveiled the figures at their annual conference in London last month at the Pestana Chelsea Bridge Hotel. RDO commissioned Bournemouth University’s Market Research Group (MRG) to undertake the extensive research study, and the report analyses the performance of the industry in 2011, specifically sales volumes and the value of sales, s well as employee numbers and payroll numbers.

According to the report, 78,118 sales were made across Europe in 2011, with an average of 121 sales per resort. The average sales value at each resort topped the €1 million mark, with the average sale value over €9,500.

What’s interesting about the report – in addition to the positive figures – is that this year, the study included shorter term timeshare products which are more economically priced, and this is a new and rising trend in the shared ownership industry.

In previous years the sales would have been based on average price of a classic timeshare week. So this reflects a shift towards shorter term, limited term products which can be bought and held for five to ten years, with an exit strategy at the end of the term already in place. Today’s timeshare buyer is typically now a younger family, who perhaps wants to buy a five to ten year term product to enjoy holidays at various resorts around the world, but who may not require a longer term product.

The study highlighted 1,345 resorts around Europe, and reveals an estimated 40,000 employees supporting resort sales and operations during 2011, with an average of nearly 30 employees at each resort. Each developer had an average of 152 employees.

The corresponding payroll across Europe exceeded €848 million with an average of more than €630,000 per resort. Each developer had an average payroll of more than €2.3 million.

The report is very good news for both the industry and buyers because it underscores the fact that the timeshare industry remains robust, is adapting to consumers’ needs in the current economy, and continues to evolve, creating new products for a whole new generation looking for new and exciting holiday experiences, adapted to their lifestyle.