Marriott Destination Points...They have done it!!!!!! {Merged}

[tombo]

Someone correct my logic here, because it can't be right - can it????

Let's assume:

Average points value per week across the system = 4,000
Enrollment take up = 100,000 weeks
Marriot bid/sell skim = 10%
= Marriott profit of 40,000,000 points
@ $9 per point = $360,000,000

Has Marriott just created $360 million inventory for itself, without laying a single brick?

And in doing so, hasn't it stolen this from its owners?

I'm sure I can't be right - someone tell me I'm wrong, please??

You are right but most Tuggers who have really put a calculater to the skim percentages have found the overall average skim to be 7%. Hey, but it could actually be 10% in the near future since Marriott can change point values at any time they decide to.

 

[wuv pooh]

I don't get what all the hub-ub is about. The biggest deal breaker should be this fact and this fact alone, the rest is for the birds.

1) you give up your HOA vote to Marriott by joining this new points program.


I keep hearing wuv pooh saying how great it will be, and you lose nothing for trying it out but the $600-$2000 for joining, and if you want to keep your week instead of points its no problem and yadda yadda yadda. You don't get your vote back buddy, and that's a wrap.

Maybe you should read the documents then. You join in one year increments and you can revoke your joining whenever you want if you are a WEEKS enrolled owner. Presto, I get my vote back. They can never take that away from me. I can voluntarily subject it to their terms, but I CAN take it back if I choose.

If you are a Trust member, then you own no real estate, are not a member of an HOA, and so have no vote. That is totally different and your point is valid.

And don't misrepresent my view. I think the system stinks vs. the old way, but it is going to be the future system and I refuse to give up my options going forward because I feel upset. Other people will make their own choices, but they have a right to:

1. Understand the real system proposed - which many posters, including me , do not fully understand. Although some very basic things are very confused by some posters and can lead to wrong decisions.

2. Decide whether the new 'benefits' may be worth the cost to them. This will vary by person and by your view of the future. Since the future is unknown I do not feel comfortable with potentially giving up my rights to the new system when I can currently join for low or no cost. Others will have different views.

 

[MikeB2620]

What difference does the skim matter if you just plan on trading your unit as you have done in the past?

When a Hawaii owner traded for an Orlando unit in the past, no one complained about a skim of value.

 

[pacheco18]

From what I can tell, the only thing that my $1495 buys me to make me on even footing with direct buyers is the ability to trade for MRP. This has absolutely no value to me at all. So how am I getting such a great deal as a resale buyer?

There are many of us who travel abroad extensively for whom the points are very valuable. I have had hotel stays worth $1500 a night!! for free with points. When I add the traded points to the points I earn on my credit card it matters. There is real value in Marriott Rewards points for me. I am Platinum, get upgraded and get to use Executive Lounge at all Marriotts. Timeshare travel is only a minor part of my vacation plan.

That's why this decision is not automatic - depends on what matters to you. The benefit of Rewards points is not in the mix for you and that is a material factor in the decision to deposit a resale week into the new program (IMO)

Additionally, as someone else just posted, the biggest question mark for me is the inventories. I usually do not trade for other resorts. I bought where I want to go and there are few Marriott properties I want to trade into. But if I choose to trade occasionally -- such as a lockoff for an NCV in September of OCtober (which I have always been able to do) -- I want to know the inventory deposited to II by non points owners will not be snatched by Marriott and given to points owners.

 

[ArtsieAng]

What difference does the skim matter if you just plan on trading your unit as you have done in the past?

When a Hawaii owner traded for an Orlando unit in the past, no one complained about a skim of value.

It matters because along with the new system comes the ability for any premier/premier plus owner to book at any resort prior to many week owners reserving their week, at their home resort.

If a Hawaii owner traded for Orlando in the past, that was their choice to do so. Marriott had nothing to do with it. How does that even come into this equation?

 

[pacheco18]

What difference does the skim matter if you just plan on trading your unit as you have done in the past?

When a Hawaii owner traded for an Orlando unit in the past, no one complained about a skim of value.

Because as a Hawaii owner I could trade my lockoff for a two bedroom with no problem. I once got a 3 bedroom at Ocean Pointe for my lockoff. That's why it matters.

 

[MikeB2620]

Multiple week owners have always had the ability to reserve weeks before a lot of single week owners.

As for "skim", I don't think it should enter into alot of the postings on this board. If you trade, you can continue to do so. You are not going to trade in your current week for points, and then trade points to get your week back.

 

[wuv pooh]

The discloser_guide.pdf that I am reviewing is only a 8 page document.

The exchange document is an additional document from the disclosure which tells how the exchange system operates. If I was more tech savvy I would post a link.

 

[MikeB2620]

pacheco, you might still be able to do that trade.

You do not have to turn your unit in to get points to trade, or to buy points to trade. You can continue to trade as you have in the past.

 

[mikeb1]

I think for those who bought resale this is a ganga! I bought one Shadow Ridge from developer for 24000 and one resale for 6125. For the 1495 (assuming I just joined with the 1 unit) I convert the resale unit into something that has ALL the value for which Legacy owners paid TENS of thousands extra. So that brings the "cost" of my resale up to around $7500 and I can still use it, trade it through II or exchange for Rewards Points.

As an owner of 2 developer units I am very pissed off. Marriott is screwing me over and completely disregarding my past loyalty to them.

I own both developer and resale. When i asked the rep about being about to enroll resale weeks and then being able to trade them for MRP's, i was told yes, and it would be the normal method where you elect to trade for the 100,000 to 125,000 pts/week that was on the sales chart for the property (like Ocean pointe). I thought this was great! However, this am i saw the below, which to me means, that first i would have to enroll my weeks, pay the 1995, and then trade my week(s) for new vac club points, then be able to convert those points to MRP's only by using a max of 50% of those vac club points (or 65% if premier or 75% if premier plus) into MRPs in multiples of 250 at exchange rate of 8000 mrp's for 250 vac club points. So if i trade Ocean Pointe plat, get 4325 vac club points.. i can then trade 2000 of those Vac Club points ( 50% *4325=2162.5.. which allows 8 units of 250 VC pts) and get 8000MRP's per 250 VC pts= 64,000 MR points...and then have 2325 Vac Club Points in my acct to use . A decent deal, if you say, i've traded in 2000/4325=46% of my points.. then based only on approx 1300 maint fee at OPointe, those 64k points cost me just under 1 cent per point.. cheaper than buying. If i were premier plus, i could trade max 75%, which would be 3,000 Vac points and then get 12*8,000= 96,000 MRP's..again, just under a penny a point.

Resale owners looking to enroll need to note the difference between trade for points or earn points

Who's Eligible to Trade?
You're eligible to trade your timeshare ownership for Marriott Rewards points when:
• You purchased your week directly from Marriott Vacation Club or from a
Marriott-authorized broker.
• Your name is listed on the deed of your vacation interest.
• All of your Marriott Vacation Club accounts are current and you have no outstanding maintenance fees or loan payments due.
• Your home resort's policy permits it. Most resorts allow you to trade for Marriott Rewards points every other year; some allow you to trade each year.
If you purchased your timeshare ownership week through a resale with a private party, you cannot trade it for Marriott Rewards points, but you can still earn Marriott Rewards points in other ways.

https://www.my-vacationclub.com/en-us/owners/1_tradingForEnrolled.jsp

 

[pacheco18]

pacheco, you might still be able to do that trade.

You do not have to turn your unit in to get points to trade, or to buy points to trade. You can continue to trade as you have in the past.

Yes, I know, but ONLY if Marriott does not snatch the units we deposit to II for its points participants. I have no intention of drinking the Kool-Aid. It does not work for me. I really want the truth about where those inventories are coming from and right now there is no trustworthy answer. And, even if Marriott said the inventories are separate and they are not snatching inventory from weeks owners from II, that could change. We are not parties to their contract with II.

Because this new program is fraught with inequities (points values could change, cost for points could change, we know nothing about inventories) I would not consider it for a minute. So glad I bought where I want to go and not to trade.

 

[MikeB2620]

Pacheco,

I agree with you, and I am not joining either. i also think the inventory situation needs to be sorted out. However, I do not think people can make a blanket statement that you will not be able to trade a lock-off in Hawaii for a 2 bdrm somewhere else because the points do not allow you to, or due to points skimming, or something else. Lots of posts complaining about situations that have yet to materialize.

 

[pacheco18]

Pacheco,

I agree with you, and I am not joining either. i also think the inventory situation needs to be sorted out. However, I do not think people can make a blanket statement that you will not be able to trade a lock-off in Hawaii for a 2 bdrm somewhere else because the points do not allow you to, or due to points skimming, or something else. Lots of posts complaining about situations that have yet to materialize.

Precisely - we do not know! Way too much uncertainty for me.
Whoever at Marriott came up with this plan made certain assumptions (including potential sales, conversions etc). Those assumptions have yet to be proven and if they are wrong the program will have to change. I'd rather sit on the sidelines than be one of the guinea pigs.

 

[Dave M]

If you purchased your timeshare ownership week through a resale with a private party, you cannot trade it for Marriott Rewards points, but you can still earn Marriott Rewards points in other ways.

https://www.my-vacationclub.com/en-us/owners/1_tradingForEnrolled.jsp

Mike -

You missed the exception, which is included in the FAQs for enrollment:

If your external purchase closed prior to June 20, 2010, it is eligible to be enrolled with the Marriott Vacation Club Destinations Exchange Program. The enrollment fee for one externally purchased week will initially be $1,495, and enrolling multiple externally purchased weeks will initially total $1,995. This offer is expected to be available only through December 31, 2010. Once you enroll your week(s), you will gain the annual option to elect Vacation Club Points, and you may also add the option of trading your week(s) for Marriott Rewards points if the week(s) you purchased externally are eligible for Marriott Rewards trade. You also will gain the benefit and convenience of the annual single-use fee (Club Dues).

https://www.my-vacationclub.com/en-us/owners/pointsintro/faqs.html#q2 (log-in required)

Reps have explained that the text means that you will be able to trade the use of your resale week for Marriott Rewards points (1) if you purchased and closed prior to June 20 and (2) if your resort is one that allows owners to exchange for Marriott Rewards points. Noit all resorts have that option.

 

[musical2]

I am still undecided. However, I did get a very inexpensive resale on a 2 BR Ko Olina Beach Club ($4750) EOY. And I would get 4025 points for it per year. Unfortunately, adding that to my Manor Club, that still leaves me 100 points shy of Premier . So that is pointing me against joining. But I do like the flexibility of trading points for some less point properties on my side of the world and still have points left over to add days over one week. I won't always want to travel that far to Hawaii.

 

[ArtsieAng]

Multiple week owners have always had the ability to reserve weeks before a lot of single week owners.

Yes, but the ratio has now been changed. The pie is now being sliced differently!

In addition to the 50% that was allowed to be booked (week owners) at the 13 month mark, there will be premier/premier plus owners able to book (point owners/Marriott) at 13 months out. Many fewer weeks will remain available for those unable to utilize that option.

As for "skim", I don't think it should enter into alot of the postings on this board. If you trade, you can continue to do so. You are not going to trade in your current week for points, and then trade points to get your week back.

Also not true......Very possible that one would choose to save points from one year to use the next year in order to bring children/family/friends along with them. They would be unable to book their own home resort/season/view, with the current point allotments.

 

[mikeb1]

Thanks Dave! That will allow the resale units to get full MR points for the week.

Here's another situation that really benefits Multi week owners who enroll. (and i'm not on the bandwagon yet).

A Ocean Point 2 BR ocean side Platinum is worth 4325 Vac Club points..for owners with enough total Vac Club Points (approx 7000) who can trade in 65% of VC points for MRP's.. then that owner can exchange 4250 of VC points for 17 units of 8,000 pts= 136,000 MRP's...that's more than the developer bought OP platinum Ocean front or Oceanside can get by exchanging the week directly for points! even more than the 3 BR Oceanfront can trade for.

Basically 1 Ocean Point 2 Br Oceanside Platinum week (= 4325 VC Pts) is worth 136,000 MRP's. (if you have enough other Vacation Club points to redeem that many).

I'm beginning to like this concept.. if you have a lot of weeks you can get a lot of MR points to trade for travel packages with lots of FF miles. Or better yet, be able to use say 3 weeks of VC points to get 2 concurrent weeks of prime time at a different resort for a family get together.. at 12 or 13 months out.. (yes, if available) if not available, you just do your normal traveling.

If you had say 3 OP weeks, you would have 12,975.. you can swap just under 65% of those, 8250 VC pts for 264,000 MRp's.. and still have 4725 VC points to use!

 

[mkahanek]

??

I am still undecided. However, I did get a very inexpensive resale on a 2 BR Ko Olina Beach Club ($4750) EOY. And I would get 4025 points for it per year. Unfortunately, adding that to my Manor Club, that still leaves me 100 points shy of Premier . So that is pointing me against joining. But I do like the flexibility of trading points for some less point properties on my side of the world and still have points left over to add days over one week. I won't always want to travel that far to Hawaii.

How are you getting 4025 points yearly for an EOY owned week?

 

[DanCali]

Yes - but if I sell I am losing far more (tens of thousands more) on the developer unit I bought - the resale unit and the developer unit are now worth the same.

This has nothing to do with if you sell an it is one of the most common fallacies. For all intents and purposes, there is no difference between a realized and an unrealized loss. When your home value was going up year after year, didn't you view that as an increase your wealth or net worth? It’s imprudent to ignore unrealized capital losses as decreases in wealth.

Additionally, many of us never plan to sell - timeshares are not and were never intended to be a real estate investment we should expect to appreciate. Those who bought with profit in mind were at best misinformed. I love my deeded weeks (I bought where I want to go and to have the flexibility to trade for Rewards Points) and plan to include them in my will - so reselling is not something I care about. The resale week I bought to use - we go to Palm Desert every year - so trading for Rewards points was not an issue.

I am not condoning the program - I will not be joining - just pointing out the huge bonus for resale buyers.

I don't expect to profit from buying a timeshare, although I did get mine at (what were) good prices. I also don't expect to profit from buying a car, furniture, home appliances, electronics, or toys for my kids. On the other hand, many do buy houses or condos and do expect them to appreciate over time. Is a timeshare closer in nature to a home, or to a car? One could make the argument that timeshares could be sold for a profit so why do timeshares naturally depreciate? The main reason, in my opinion, is that MFs increase at a rate higher than inflation (coupled with overbuilding in some areas)... If the future obligation is higher, resale prices are lower. So we can see that developers already affect resale prices because they determine MFs. But I truly cannot think of another product where the "manufacturer" goes out of their way to destroy resale value.

The issue of retail buyers that resale buyers now pay "only" $1500 and they are "equal" even though they paid a lot less is correct, but it is (in my opinion, of course) somewhat silly to complain about and focuses on the wrong issue. The only difference between resale and retail was the ability to convert to MRP at the cost of MFs. Did anyone honestly think that is worth tens of thousands of dollars when you can buy the points at almost the same rate from Marriott? If anyone thought that, they should be converting to points every year, but I bet very few people do that. Who pays for all the glitz and glamor in a sales presentation? Who pays for the fat commissions Fletch boasted about? That is where the difference between resale and retail went. This may sound blunt but it's just brutal honesty - if anyone told you MRP conversion is worth tens of thousands of dollars you were misled, because apparently it is not, and even Marriott just admitted it.

The bigger issue is that Marriott took the worst page out of Starwood's book and decided to exclude future resale buyers from the program. Even if you do join points, it is not obvious from the documents if a future buyer can join. To make matter worse, they skim 7% to 12% of your points when you make exchanges, something that even the more notorious management companies don't do. This can ultimately destroy the value of the assets we own and it will be Marriott's doing. As Susan said more than once in many threads, "they have no responsibility to protect resale value", but a company will purposely destroy resale value for its own gain only if it is extremely arrogant and feels untouchable. Even those who say Marriott has no obligation to protect resale values, have yet to name another company (outside of the timeshare industry) that operates in this manner.

So I will take this last paragraph and open a new thread on this topic - I'm curious to get an answer...

 

[m61376]

Someone correct my logic here, because it can't be right - can it????

Let's assume:

Average points value per week across the system = 4,000
Enrollment take up = 100,000 weeks
Marriot bid/sell skim = 10%
= Marriott profit of 40,000,000 points
@ $9 per point = $360,000,000

Has Marriott just created $360 million inventory for itself, without laying a single brick?

And in doing so, hasn't it stolen this from its owners?


I'm sure I can't be right - someone tell me I'm wrong, please??

You left out one important point- they get to make this profit EVERY year!

 

[DanCali]

You left out one important point- they get to make this profit EVERY year!

No - he's quite close because the $9 per point is for a perpetual purchase.

On an annual basis, a point is probably worth to Marriott $0.50 to $0.70. For example, 4750 to reserve a summer NCV that they rent at $400/night. On an annual basis, the 40 million skimmed points are probably $20M-$25M profit to Marriott.

 

[SueDonJ]

... To make matter worse, the skim 7% to 12% of your points when you make exchanges, something that even the more notorious management companies don't do. This can ultimately destroy the value of the assets we own and it will be Marriott's doing. As Susan said more than one in many threads, "they have no responsibility to protect resale value", but a company will purposely destroy resale value for its own gain only if it is extremely arrogant and feels untouchable. Even those who say Marriott has no obligation to protect resale values, have yet to name another company (outside of the timeshare industry) that operates in this manner.

So I will take this last paragraph and open a new thread on this topic - I'm curious to get an answer...

I'm responding here because it's for certain that Dave is going to lock your thread and send you back here.

About "skim" - or "breakage" as it's been referred to for all of the years that it's existed in other timeshare point systems - I agree that Marriott appears to have protected itself with a much larger percentage of breakage than the existing point systems.

But the one unknown that Marriott couldn't factor into any of its business model for the Points system is how much inventory can be expected from existing Weeks owners (whether enrolled or not.) ALL of the documents are full of the "points values may be subject to change" because of that unknown.

I know, I know, on TUG Marriott is The Big Bad Playground Bully Out To Knock Us Around. But in the real world Marriott is a customer satisfaction leader in the hospitality industry. Isn't it even .00000001% POSSIBLE that the breakage has been set so high at rollout to protect Marriott in the event that their most pessimistic expectations for this product are realized, and that in the event it is successful the adjustments will be made to protect the enrollees?

Go ahead, tie me to the stake and burn me for daring to speak such blasphemy as Marriott may actually do right by owners if the program is more successful than their worst predictions. But isn't it remotely possible? Just a teeny tiny little bit possible?

 

[tombo]

Susan you are very inteligent and post responses to defend marriott at every turn, yet to find some way to justify the theft of 7% to 10% of the entire Mariott points inventory by skimming (or instead using marriotts nice words instead of theft as you like to do "breakage") is unacceptable and something NO OTHER points timeshare organization does it. To say that Marriott "must" do it to protect themselves from unknwn inventory is a joke. they worked on this thing for several years and went through every possible scenario before rolling the new program out. It is bult in profit for Marriott pure and simple, and it was designed that way on purpose hoping that they can slip it by the majority of owners while claiming to save them money by giving free exchanges and free lock-offs. the problem is that veryone on TUG has caught on to their trickery and deceit, everyone that is except possibly you. I think deep down you know this is very wrong, but like talking bad about a black sheep member of your family, I just don't think you can bring yourself to say anything negative about Marriott even if you know it to be true. You are for some reason loyal to Marriott in spite of the fact they they have shown no loyalty to you or any other owner when they rolled out this program.

If my week is worth 5000 points if someone else want to rent it, and the week they deposit will cost me 5000 pints to rent, then these are like fr like trades and I should get enough points using my deposit to exchange for their week. However thanks to skimming they can't deposit their 5000 point week and exchange for my 5000 point week, and I can't exchange for their's either because marriott won't give either of us enough points to make like for like exchanges. That is a ripoff and whether you prefer to call it skimming, theft, or breakage it is WRONG!!!!!

 

[GregT]

I'm responding here because it's for certain that Dave is going to lock your thread and send you back here.

About "skim" - or "breakage" as it's been referred to for all of the years that it's existed in other timeshare point systems - I agree that Marriott appears to have protected itself with a much larger percentage of breakage than the existing point systems.

But the one unknown that Marriott couldn't factor into any of its business model for the Points system is how much inventory can be expected from existing Weeks owners (whether enrolled or not.) ALL of the documents are full of the "points values may be subject to change" because of that unknown.

I know, I know, on TUG Marriott is The Big Bad Playground Bully Out To Knock Us Around. But in the real world Marriott is a customer satisfaction leader in the hospitality industry. Isn't it even .00000001% POSSIBLE that the breakage has been set so high at rollout to protect Marriott in the event that their most pessimistic expectations for this product are realized, and that in the event it is successful the adjustments will be made to protect the enrollees?

Go ahead, tie me to the stake and burn me for daring to speak such blasphemy as Marriott may actually do right by owners if the program is more successful than their worst predictions. But isn't it remotely possible? Just a teeny tiny little bit possible?

Sue,

Your points are very appropriate -- Marriott provides a tremendous hotel and service product and is very customer-service oriented. The companies that I work for have always used them, or adopted the view that its Marriott's business to lose whenever we've done something significant (National Sales Meeting, etc).

Which is one of the reasons I'm so stunned at the skimming, it's so counter to the customer-service orientation I expected. It has the appearance that existing owners are a captive audience ("we've already gotten their money and therefore we can do with them as we intend") which is the Wyndham model. The Hilton model is we have extra units available, let's let our owners rent them for cheap so no unit sits empty. It's a great perk and the type of thing that Marriott would have considered -- but didn't implement (at this time.)

I fully expect that Marriott will introduce an Open Season concept at some point, but at that point The Skim is permanent in place -- and many many owners will have purchased 1,000 points because they are just short to be able to use the system, or they opted out, minimizing the success of the system.

I can't figure out what Marriott was thinking -- and how they could have viewed The Skim as anything other than an unnecessary tax to the existing owner.

And I don't want to viewed as rigidly discouraging all TUGgers to join -- this could be an excellent opportunity for a multiple week owner who does not need to buy additional points from Marriott, and likes the trades they would get with their existing (skimmed) points values. For that owner, it is a simple decision of which system (points/direct) provides better access to the places you want to go and the additional $199 is not burdensome on that multiple-week owner. It's the single week owner who now has to buy 1,000 points and pay $400 in new points MFs (in addition to $165) that I really feel for, all because they were skimmed on what their unit was worth.

Very frustrating.

Best to all,

Greg

 

[ArtsieAng]

Sue,

Your points are very appropriate -- Marriott provides a tremendous hotel and service product and is very customer-service oriented. The companies that I work for have always used them, or adopted the view that its Marriott's business to lose whenever we've done something significant (National Sales Meeting, etc).

Which is one of the reasons I'm so stunned at the skimming, it's so counter to the customer-service orientation I expected. It has the appearance that existing owners are a captive audience ("we've already gotten their money and therefore we can do with them as we intend") which is the Wyndham model. The Hilton model is we have extra units available, let's let our owners rent them for cheap so no unit sits empty. It's a great perk and the type of thing that Marriott would have considered -- but didn't implement (at this time.)

I fully expect that Marriott will introduce an Open Season concept at some point, but at that point The Skim is permanent in place -- and many many owners will have purchased 1,000 points because they are just short to be able to use the system, or they opted out, minimizing the success of the system.

I can't figure out what Marriott was thinking -- and how they could have viewed The Skim as anything other than an unnecessary tax to the existing owner.

And I don't want to viewed as rigidly discouraging all TUGgers to join -- this could be an excellent opportunity for a multiple week owner who does not need to buy additional points from Marriott, and likes the trades they would get with their existing (skimmed) points values. For that owner, it is a simple decision of which system (points/direct) provides better access to the places you want to go and the additional $199 is not burdensome on that multiple-week owner. It's the single week owner who now has to buy 1,000 points and pay $400 in new points MFs (in addition to $165) that I really feel for, all because they were skimmed on what their unit was worth.

Very frustrating.
Best to all,

Greg

I couldn't agree more! In addition, Marriott is imposing a 1000 point minimum. Many would need much less to get to the premium level, or to be able to reserve their initial purchase. Marriott is not even allowing Legacy Owners a break on purchasing points.

Some things are just not defendable, no matter how hard you try!