I worked for one of the major xchange companies...

[Carolinian]

There is a way that one of the worst features of RCI Points for timesharing as a whole could be done in a different way with much less negative impact. That is the Points Partners area, something I have been critical of since RCI first rolled out GPN (the early name of RCI Points). From the beginning, I pointed out that this would feed RCI rentals to the general public, something the RCI defenders vehemently denied on the old TUG board, and we have seen that in fact it has.

Airfare and hotel inventory could be offered on a member to member type of exchange, with the exchange company acting only as a broker, instead of buying and selling things in the market, which is what leads to the rentals. In the present Points Partner program, RCI buys an item like airfare, and then rents timeshare weeks to the general public to pay for it.

Instead of that system, they could interface with one or more airline ff programs and hotel points programs. X number of timeshare points would give a member Y number of airline ff miles. The only timeshare points program that does anything like this now is Hapimag with Lufthansa, but that is a cash deal with the airline rather than a member to member exchange.

The difference would be that this interface would involve airline ff program members and timeshare points members being able to access each other's programs, with the exchange company charging a fee for brokering the deal.
One would have to guess at the exchange rate in the beginning, but then it could be adjusted for actual market trends on a regular periodic basis.

An airline ff member acquiring timeshare points who was not already an exchange company member would then buy a temporary membership in the exchange company to use his timeshare points, another profit center for the exchange company.

This would be a true market based exchange with a good profit opportunity for the exchange company but no incentive for the exchange company to do any hanky-panky. This would also eliminate one of the big excuses for timeshare rentals to the general public by exchange companies.

Carolinian, If you had to create a points system what would you include/exclude?

 

[boyblue]

Carolinian, actually one thing I've always agreed with you on is the uselessness of points partners. I was more curious about points being used for trading timeshares.

Would you be for a properly implemented points program that used a uniform valuation system for week & points resorts?

 

[Change the X-change]

UPDATE!!!

I am planning some changes that I know will make many happy...will be back in a few days to discuss.

Thanks to all

 

[Carolinian]

There are two major things that would be necessary to cure some of the fundamental flaws in points systems.

The first is to move from the current partially transparent system to a fully transparent system by revealing the formula for setting point values. The partially transparent system of revealing the resulting numbers but not the formula is the worst of all worlds because it creates both the motive and opportunity for developers to cheat by politicking the exchange company for inflated values for their weeks. A non-transparent system lacks the motive and a fully transparent system lacks the opportunity.

The second is to move to publishing numbers only on the internet and junk the use of paper and ink. The limitations of a paper and ink system of publishing values prevents a flexible or fair system of valuations, because space limitations lead to overaveraging (RCI Points saying a mid-August week 33 at the beach has the same value as a late October week 43, for example, is just nuts) and the cost of printing a new edition prevents frequent adjustments for ever changing supply and demand factors. In the spring and fall, when week values are changing very gradually week by week, a fully electronic publication method would have the capacity to set individual values on each week, if necessary, or at least do them in smaller groups, perhaps two weeks together.

Carolinian, actually one thing I've always agreed with you on is the uselessness of points partners. I was more curious about points being used for trading timeshares.

Would you be for a properly implemented points program that used a uniform valuation system for week & points resorts?

 

[geekette]

I don't think all point systems are the same, but things can be learned, good and bad, from every point system.

 

[PerryM]

I must be on vacation

I know that I must be on vacation since I agree with Carolinian!

• The definitions needed to come up with the points per day at each resort must be disclosed!

• The points calendar for each resort should only be available on the internet and if someone needs a hard copy they can pay $5 to RCI to print it and send it

Of course I’d base the points on the rack rental rates but RCI could use anything that applies universally like MF’s per square foot or the Square Footage times a point value like 4=Gold Crown, 3=Silver Crown, 2=Bronze Crown (or whatever RCI calls it today), 1 = non rated.

 

[rickandcindy23]

Seasons are more important than Gold and Silver Crown. I would rather stay in a ski resort that is SC any day during ski season than a GC in the same area during summer.

 

[wbtimesharer]

Good luck on getting this system up and running. I for one don't have much of a problem with the current exchange companies. We are in a capitalistic country and all companies exist to enrich their shareholders. The best way to send a message to the companies who are charging too much is to stop using their services. Since it appears that isn't happening, then I would hazard to guess that there isn't enough competition to force their prices down. The old Supply and Demand theory strikes again. You may be the competition that is needed to do just that.

I think that the major advantage the exchange companies have is their ease of use, safe transactions, and size to handle the volume that a good exchange company must have. While it will take you time to get there, I wish you all the luck in the world and hope to be able to use your services in the future.

 

[PerryM]

I'm stumped

Cindy,

Of course you are correct. I'm trying to think of 3rd party things that could be used in a formula that would be published and is impartial to all resorts and seasons.

Beyond my preferred rental rates it becomes very hard to do. MF's divided by square footage is a great starting place then seasonality needs to be added along with the rating of the unit. I am stumped as how to do this though.

 

[timeos2]

Seasons are more important than Gold and Silver Crown. I would rather stay in a ski resort that is SC any day during ski season than a GC in the same area during summer.

Seasons are covered in the points values assigned. Within a given season a SC gets more than a standard resort and a GC more than a SC. There is still more value to a ranked resort even in off-season than an unranked resort would have. But certainly even higher value in season. A properly designed system accounts for those differences.

 

[Carolinian]

The problem is that award rankings do not mean nearly as much to trade power as location does. For example on the OBX, one of the Gold Crown resorts has the highest demand for the OBX while the other GC decidedly the lowest demand resort there. The difference? The high demand GC is right on the beach, while the low demand GC is in the woods behind the Wal-Mart where you have to drive to the beach. Beachfront location is a FAR more important factor in demand than award status is. Someone long involved in timeshare rentals on the OBX, the late Marvin Beard of Outer Banks Resort Rentals, has said that even though the owners of the GC behind the Wal-Mart, BIS-Kitty Hawk, would price their rentals $100 cheaper than the standard resorts on the beach, they could not rent them unless all of the beachfront standards were already rented. Location is the main driver of demand and leaves award status in the dust unless location factors are similar.

RCI Points weighs award status in determining point value much much more than the average vacationer does in choosing a resort. That is one of the major flaws in the RCI Points system.

 

[Carolinian]

Re: I'm stumped

Without a doubt, size matters, but is still a lesser driver of demand than location.

Maintenance fees do NOT matter in trading power. Should someone get higher trading power just because they own at a poorly managed resort that is jacking up fees to make up for not maintaining enough reserves? The amount of the m/f has at least as much to do with the competence of the management as it does with the quality of the resort. Similarly purchase price does not matter. Is a blue week that someone overpaid a developer price for more desirable than a solid red week that someone got a good deal on with ebay? I don't think so!

Cindy,

Of course you are correct. I'm trying to think of 3rd party things that could be used in a formula that would be published and is impartial to all resorts and seasons.

Beyond my preferred rental rates it becomes very hard to do. MF's divided by square footage is a great starting place then seasonality needs to be added along with the rating of the unit. I am stumped as how to do this though.

 

[PerryM]

Close but no cigar (thankfully)

90% of all resorts must charge the same MF’s to all owners (same sized unit) regardless of season – state laws. The few that don’t do allow different MFs for different seasons (same sized unit).

I can’t quote a study or a link where MF’s are related to each other. E.g. The Westin Maui charges $1,750 MF for a 2BR and a WM charges $480 for Kihei Maui 2BR. So, does this tell us anything about a WM exchanging into a Westin? Or, a Westin exchanging into a WM?

My gut reaction is that there is a direct relationship to “quality” but has nothing to do with supply and demand. As I said I think it’s a starting place AND it's a hard and fast number.

It could very well be that there is not enough of a relationship to use MF’s in determining trading power. I don’t think we can dismiss MF without further research - my opinion.

 

[boyblue]

Caro I'm stumped - I actually agree with your last three posts,

Referring to your post (#104) I totally agree with your assessment of the situation with points. I would like to add that as far as there being no motivation to do the same thing in weeks, I'm not sure. I tend to believe that if you're gonna skim from the semitransparent system why not skim from them both. When the culture of dishonesty creeps into a company, it knows no bounds.

Your posts (#'s 111 & 112) are dead on. Factoring in location in a more specific way (other than just state by state) would make the RCI Points system a whole lot better. As you mentioned if it’s paperless it wouldn’t be that difficult to do or to make adjustments.

I wonder, can we do a poll in Ask RCI or is that something that Madge would have to initiate.

 

[rickandcindy23]

Orlando should not be red 12 months of the year. Not that RCI and II treat all times of year as red, but the sales gimmick is, "all Orlando weeks are red."

I still think all Hawaii are red. I would rather get into Hawaii than worry about Five Star or GC, because most of our experiences with Hawaiian resorts has been great. Hawaii is a luxury, affordable to empty nesters that would rather travel in off season times. There are plenty of us out there willing to stay in what some would consider off season, such as whale season.

Our Gardens at West Maui is not Five Star but has all the qualities of that rating, except the whirlpool bathtub in the master. I did not miss it on Maui. We never saw a roach at Gardens, but Kona Hawaiian Village was overrun with roaches. Our unit there was the worst I have seen anywhere. Trash cans should not be under the sink. I realize that others haven't had roach problems at KHV, but we certainly did.

 

[Carolinian]

Re: Close but no cigar (thankfully)

Maintenance fees have a lot more to do with competence or lack of same by management over a lengthy period than they do with quality. On the OBX, consistently the resort with the lowest m/f's is one of the best managed that keeps its deedback/foreclosures turned so there is no deadwood on the books. On the other hand, one of the highest m/f's has consistently been a poorly managed resort with lots of deadwood, low reserves, and a huge backlog of maintenance and updating issues. Quality can just as often be with the lower m/f.

And then, internationally, m/f's can often reflect the strength or weakness of a national currency rather than anything to do with timesharing.

90% of all resorts must charge the same MF’s to all owners (same sized unit) regardless of season – state laws. The few that don’t do allow different MFs for different seasons (same sized unit).

I can’t quote a study or a link where MF’s are related to each other. E.g. The Westin Maui charges $1,750 MF for a 2BR and a WM charges $480 for Kihei Maui 2BR. So, does this tell us anything about a WM exchanging into a Westin? Or, a Westin exchanging into a WM?

My gut reaction is that there is a direct relationship to “quality” but has nothing to do with supply and demand. As I said I think it’s a starting place AND it's a hard and fast number.

It could very well be that there is not enough of a relationship to use MF’s in determining trading power. I don’t think we can dismiss MF without further research - my opinion.

 

[Carolinian]

An exchange company can skim most any system if it is inclined.

What a non-transparent system stops is the developer cutting an under the table deal with an exchange company to give it higher numbers than it deserves. If the numbers are public, this is a useful sales gimmick. If they are not public, there is no advantage to their doing such a deal because they can't use nonpublished numbers to push sales. Of course, a fully transparent system accomplishes the same thing.

Caro I'm stumped - I actually agree with your last three posts,

Referring to your post (#104) I totally agree with your assessment of the situation with points. I would like to add that as far as there being no motivation to do the same thing in weeks, I'm not sure. I tend to believe that if you're gonna skim from the semitransparent system why not skim from them both. When the culture of dishonesty creeps into a company, it knows no bounds.

Your posts (#'s 111 & 112) are dead on. Factoring in location in a more specific way (other than just state by state) would make the RCI Points system a whole lot better. As you mentioned if it’s paperless it wouldn’t be that difficult to do or to make adjustments.

I wonder, can we do a poll in Ask RCI or is that something that Madge would have to initiate.

 

[Dave M]

...can we do a poll in Ask RCI....

If you want to do an informal poll, you can start a thread here in the Exchanging forum. You cannot start such a thread in the Ask RCI forum.

This software supports polls. It's possible that after we move to a dedicated server (soon), we might enable such polls.

 

[DebBrown]

Wow! I just found this thread and you Tuggers have some great ideas. I do think, however, that it would be hard to compete in this industry. The average non-Tugger is not likely to move away from the big two.

Mike, my concern for you is that you have so much experience with II. You will have a hard time thinking outside the box. Your ideas do not seem novel or interesting. It is the TUG members contributing all the worthwhile ideas.

Personally, I like II and the week exchange. I've been doing this for years and the fun part is trading up - using a low-end exchange or bonus week to pull something really good. That's the game that got me hooked in the first place. Fairness is fine but not necessarily fun. LOL!

Deb

 

[T_R_Oglodyte]

Re: Close but no cigar (thankfully)

Maintenance fees have a lot more to do with competence or lack of same by management over a lengthy period than they do with quality. On the OBX, consistently the resort with the lowest m/f's is one of the best managed that keeps its deedback/foreclosures turned so there is no deadwood on the books. On the other hand, one of the highest m/f's has consistently been a poorly managed resort with lots of deadwood, low reserves, and a huge backlog of maintenance and updating issues. Quality can just as often be with the lower m/f.

And then, internationally, m/f's can often reflect the strength or weakness of a national currency rather than anything to do with timesharing.

Yep. If you can just raise fees, it's often easier to do that than to increase efficiency. Doing things such as reviewing alternatives approaches, dealing with inefficient employees, etc. involves real work. Who wants to do that when you can just raise rates??

 

[Carolinian]

Australia/New Zealand is a good example of where there is active competition between four exchange companies, two independents and the two big US-based companies, but if you want to exchange in there, you are much more likely to find the exchange you want with one of the independents.

RCI's recent behavior on many fronts is certainly creating fertile ground for a challenge here. The big hurdle is getting the information out to the average exchanger, and that is going to take establishment of good working relationships with HOA's.

Wow! I just found this thread and you Tuggers have some great ideas. I do think, however, that it would be hard to compete in this industry. The average non-Tugger is not likely to move away from the big two.

Mike, my concern for you is that you have so much experience with II. You will have a hard time thinking outside the box. Your ideas do not seem novel or interesting. It is the TUG members contributing all the worthwhile ideas.

Personally, I like II and the week exchange. I've been doing this for years and the fun part is trading up - using a low-end exchange or bonus week to pull something really good. That's the game that got me hooked in the first place. Fairness is fine but not necessarily fun. LOL!

Deb

 

[BocaBum99]

I find it difficult to believe that information about how to make an effective exchange will diffuse to the general timesharing public before information about the great deals available on the resale market presents itself broadly. After all, a price on a website is something a person can see. Trading power is abstract.

There is tremendous apathy amongst large numbers of timeshare owners. I think the underserved market is NOT for timeshare exchange, but for timeshare rentals.

Go to an HOA or an average timeshare owner and tell them you have yet another way to exchange your week and the likely response will be a yawn. Tell them that you will list their week and be able to recoup most of their expenses and maybe even provide a bit of a profit and that may get their attention.

This is especially true for people who own prime weeks and have traded down or let their weeks go unoccupied for years.

The biggest problem for creating a timeshare exchange is that you can't even begin exchanging until you have a ton of weeks on deposit. If you start a rental business, all you need is ONE week and you can list it for available to ANY person who wants to go on vacation.

 

[Simoncc]

I think the underserved market is NOT for timeshare exchange, but for timeshare rentals.

Go to an HOA or an average timeshare owner and tell them you have yet another way to exchange your week and the likely response will be a yawn. Tell them that you will list their week and be able to recoup most of their expenses and maybe even provide a bit of a profit and that may get their attention.

That's the way I would go as well. No need for independent points/trading power valuations as each owner and/or resort can set their own asking price.

If the scheme was to quickly expand beyond the existing Redweek type operation it would need to provide an incentive to resorts who market the scheme to owners.

 

[PerryM]

Me too

My dream system allows for rentals too! You can deposit your week and specify that it can ONLY/OR be rented and you would supply cash rental price. This cash rental price is less than or equal to the rental Rack Rate – that’s up to you.

However, ONLY folks in the system can rent – no renting to the general public. If you deposited a unit with a rental Rack Rate of $3,000 and the Cash rental rate for a unit is $3,000 or less you can rent it. That amount is kept in your files and you must deposit more to rent for cash.

If you don’t rent, the amount you have deposited “rolls forward” indefinitely so you could build up a reserve to use for cash rentals.

 

[BocaBum99]

Re: Me too

My dream system allows for rentals too! You can deposit your week and specify that it can ONLY/OR be rented and you would supply cash rental price. This cash rental price is less than or equal to the rental Rack Rate – that’s up to you.

However, ONLY folks in the system can rent – no renting to the general public. If you deposited a unit with a rental Rack Rate of $3,000 and the Cash rental rate for a unit is $3,000 or less you can rent it. That amount is kept in your files and you must deposit more to rent for cash.

If you don’t rent, the amount you have deposited “rolls forward” indefinitely so you could build up a reserve to use for cash rentals.

I like the resortquest model. There, you buy condos or houses and have resortquest manage the unit, the hospitality and the rental program. They charge 35% commission. And, owners get a 50% discount on rental listings of other resortquest properties.

Does this qualify as the ideal point system? Cash is used, you can exchange for any property in the system by using that currency. Only owners get the benefit. The market sets the point value. Owners get specific benefits.

To me, that's the ideal exchange model. A rental exchange model. I might create it. The owner discount might be a bit lower as will be the commission. And, the resorts will do hospitality and unit management.