Open Season Rates have been Increased

[CalGalTraveler]

I agree with this statement. Furthermore I have been in contact with Barbara Rinks, Director of Club and Owner Services about this issue. Below is my last e-mail to her yesterday that conveys my thought on this subject.


Thank you Barbara for your e-mail clarifying that the inventory that is offered during Open Season is in fact inventory that was not reserved by owner/members during the Club Reservation Period which is what my analysis revealed. I concur that the club rules, which HGVC wrote, do state that HGVC has the right to use that inventory basically for whatever it wants.

However, the Open Season inventory is inventory that owner/members own and did not give up to the HGVC for Hilton Honors Points or other perks. Therefore, owner/members should be able to reserve that time at a large discount from that which the general public pays.

If they continue to advertise open season rates as a benefit when one can purchase same or even lower via other discount channels, they are cutting off their noses to spite their face because this is not a benefit.

Why on earth would anyone pay thousands of dollars upfront for the headache and long term commitment of a timeshare when you can get the same room off the street without a "club" membership and get the same rate?

What i find unconscionable is that these are units that we own and they are selling them back to us at market rates that anyone can get via a discount channel.

This is not what was sold to us as part of this "club."

Bait and switch.

 

[jestme]

It does sound like a much better deal to stay somewhere else.

Especially when you consider the additional flexibility of cancelling, booking a 1 day reservation, and not knowing what your costs will be until they show up on your reservation or even if there is going to be availability, which you only find out 29 days before you are going somewhere. It used to be worth those hassles only because of the price, but price isn't enough of a factor any more and I certainly don't feel any loyalty towards Hilton anymore.

 

[Tamaradarann]

The Inventory is Owner/Members Inventory!

AAA has 55.6 MILLION members. I don't realistically think HGVC members should expect a rate better than they offer.

http://newsroom.aaa.com/about-aaa/aaa-fact-sheet/



and Hilton Worldwide made $10.5 Billion without offering a single discount to HGVC members in 2014. Even if your $100M number is correct (which I highly doubt), this is a blip (less than 1% of revenue... almost a rounding error). On top of that, most of the time you can get a room for ~$100 a night at the Hampton inns (not really that profitable), and possibly even the Embassy suites. Discounting those rooms makes little sense for Hilton as people would probably stay there anyways.

What would made sens for Hilton, is if they got HGVC members to each take 4 nights at $300 a night (regularly 5-700/night). That would be $300M of revenue in profitable rooms.

If you want to pay that, then be my guest, but expecting discounts at their already discounted chains is not likely (especially in excess of what you can already get through other "clubs" or priceline etc..)

Jason, I would agree with you about the AAA discount versus the HGVC discount, except for the following major issue and the position that I take and continue to emphasize on this site and to HGVC

"the Open Season inventory is inventory that owner/members own and did not give up to the HGVC for Hilton Honors Points or other perks. Therefore, owner/members should be able to reserve that time at a large discount from that which the general public pays."

 

[Jason245]

Jason, I would agree with you about the AAA discount versus the HGVC discount, except for the following major issue and the position that I take and continue to emphasize on this site and to HGVC

"the Open Season inventory is inventory that owner/members own and did not give up to the HGVC for Hilton Honors Points or other perks. Therefore, owner/members should be able to reserve that time at a large discount from that which the general public pays."

I was writing in response to access to hotel rooms, not open season rooms.

I agree to the whole open season room issue if they do not do away with that system and instead switch to discount on ALL Hilton hotel reservations instead.

 

[jestme]

I was writing in response to access to hotel rooms, not open season rooms.

I agree to the whole open season room issue if they do not do away with that system and instead switch to discount on ALL Hilton hotel reservations instead.

Jason245, AAA is an automobile association, and one of it's many side perks is hotel discounts. It's main function is to provide you with roadside assistance insurance. When it sells a membership, hotel stays are just one of a large number of small discounts that come along with it as part of the package. However, if it removes the hotel perk or makes it negligible, it lowers the value of the whole product to it's members.
HGVC is doing the identical thing by lowering Open Season's value to its members. The criteria they now use for pricing is totally different from what was sold to us, and will have a direct negative affect on owners HGVC value. They now have a multi-tier product, where they originally sold a balanced product. Points in Orlando are the same as points in Hawaii, but dollars are no longer the same.
I think the original poster may be correct. A class action law suit may have merit. HGVC management's decision to change the criteria they use for Open Season pricing, has reduced the value of what they sold. The same as would apply if they doubled or tripled point values required for exchanging into Hawaii from an Orlando or Las Vegas home resort.

 

[Jason245]

Jason245, AAA is an automobile association, and one of it's many side perks is hotel discounts. It's main function is to provide you with roadside assistance insurance. When it sells a membership, hotel stays are just one of a large number of small discounts that come along with it as part of the package. However, if it removes the hotel perk or makes it negligible, it lowers the value of the whole product to it's members.
HGVC is doing the identical thing by lowering Open Season's value to its members. The criteria they now use for pricing is totally different from what was sold to us, and will have a direct negative affect on owners HGVC value. They now have a multi-tier product, where they originally sold a balanced product. Points in Orlando are the same as points in Hawaii, but dollars are no longer the same.
I think the original poster may be correct. A class action law suit may have merit. HGVC management's decision to change the criteria they use for Open Season pricing, has reduced the value of what they sold. The same as would apply if they doubled or tripled point values required for exchanging into Hawaii from an Orlando or Las Vegas home resort.

Good luck with that.. the club docs are very specific. In the end.. your only right is the interval you bought and were deeded.

You better bet is to just publisize the increases and create a large enough group of owners to complain. . Make sure to tell everyone you meet at resorts about it and encourage them to complain. If you go on updates refuse to buy upgrades due to this (even though it isn't the real reason ).

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[CalGalTraveler]

Good luck with that.. the club docs are very specific. In the end.. your only right is the interval you bought and were deeded.

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Although there is some wording in contracts, and I am not a lawyer but based on business dealings I see several weaknesses:


1) FTC violations. These rates were published and widely advertised both on-line and in presentations from sales representatives. People bought into the program with the expectation that they would get deep discounts for paying for this club up-front. Such a practice not only is an advertising violation it could be construed as bait and switch.

2) Property Owner rights. It seems that an owner should be able to receive rents for property that they own and should have power over where that property is rented. Perhaps, this may be why we can rent out or exchange our home week. Actions could also be taken about management and associated fees via homeowner board meetings if enough owners participated and voted.

3) Fine print doesn't always mean that they can enforce it. This is why lawyers require that people signing a pre-nup agreement must mark it up to ensure it was read. I also seem to recall from a business law class many years ago that there is some common law basis for the fact that you cannot tell somebody one thing and then hand them something else on a contract.

 

[Jason245]

Although there is some wording in contracts, and I am not a lawyer but based on business dealings I see several weaknesses:


1) FTC violations. These rates were published and widely advertised both on-line and in presentations from sales representatives. People bought into the program with the expectation that they would get deep discounts for paying for this club up-front. Such a practice not only is an advertising violation it could be construed as bait and switch.

2) Property Owner rights. It seems that an owner should be able to receive rents for property that they own and should have power over where that property is rented. Perhaps, this may be why we can rent out or exchange our home week. Actions could also be taken about management and associated fees via homeowner board meetings if enough owners participated and voted.

3) Fine print doesn't always mean that they can enforce it. This is why lawyers require that people signing a pre-nup agreement must mark it up to ensure it was read. I also seem to recall from a business law class many years ago that there is some common law basis for the fact that you cannot tell somebody one thing and then hand them something else on a contract.

I am not going to point out the flaws of your legal arguments other than to say that neither of them hold any water.

There is no ftc violation and no valid cause of action. Your case would more than likely be dismissed and you would be sued for attorney fees.

Just cause you don't like it doesn't make it something you can fight and win. Just ask the wastegate owners.



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[CalGalTraveler]

I am not going to point out the flaws of your legal arguments other than to say that neither of them hold any water.

There is no ftc violation and no valid cause of action. Your case would more than likely be dismissed and you would be sued for attorney fees.

Just cause you don't like it doesn't make it something you can fight and win. Just ask the wastegate owners.



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Jason245 are you a lawyer? Creative lawyers have sued for a lot less. Consider the most recent Groupon class action, shareholder lawsuits or the McDonald's coffee spill.

BTW...All it takes for FTC is to report a violation. The government's lawyers take care of the rest. The government loves to make an example of a high profile target to clean up an entire industry. No one ever heard of Westgate except for Westgate owners.

 

[Jason245]

Jason245 are you a lawyer? Creative lawyers have sued for a lot less. Consider the most recent Groupon class action, shareholder lawsuits or the McDonald's coffee spill.

BTW...All it takes for FTC is to report a violation. The government's lawyers take care of the rest. The government loves to make an example of a high profile target to clean up an entire industry. No one ever heard of Westgate except for Westgate owners.

You can file a complaint, they decide what to do. .and likely nothing..

Similarly the ag office for your state..

I recommend you consult an attorney on this and you will see what they say.

Your problem is that you need to show actual damages... you have no damages by them raising rates to a suplemntary product which is optional for them to even provide.

What the sales weasel told you is meaningless the contract governs all..

Legal action is not feasible. But for 10k you can take action and tell us how it goes.

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[1Kflyerguy]

I am disappointed they are increasing the rates, but its not unexpected. Hotel rates have been really going up in general, so this is not unexpected to me.

I have to be honest, and admit that i have never used open season, so i am not personally impacted, but this has been a nice feature of the program that i always expected to use, but it never worked out for me...

 

[CalGalTraveler]

Aside from the legal concerns their marketing and program teams are acting stupidly by biting the hand that feeds them - alienating advocates that could sell more of their offering.

Does HGVC even have a voice of the customer or customer advisory counsel to help them test and get feedback with these kinds of issues? Have they even run focus groups on this? This is marketing 101.

Here is a smarter way to go about this, make Hilton more money and keep owners happy:

Grandfather open season rates for HGVC system based on year first purchased to keep owners happy and avoid a lawsuit. Regular open season rates as they are now for new buyers. (Grandfathering is how this should have been implemented in the first place.)

and/or

Offer to owners the opportunity to get a standard percentage (e.g. 20%) off of the lowest published rate (e.g. AAA) in the entire Hilton hotel system when booked via Hilton.com.

This way Hilton gets more incremental cash for rooms throughout the system (this would be far more lucrative for Hilton than open season rates). Owners win because they can get Hilton rooms at a lower rate than others. This would be attractive to owners because HGVC is not in all locations. This honors the fact that HGVC owners are Hilton's best customers and advocates and would be more loyal to the system.

This is not perfect but you get the idea. Much better to offer additional benefits and adjust rather than taking stuff away from your best customers.

 

[Tamaradarann]

They have only raised Hawaii - At this point!

Aside from the legal concerns their marketing and program teams are acting stupidly by biting the hand that feeds them - alienating advocates that could sell more of their offering.

Does HGVC even have a voice of the customer or customer advisory counsel to help them test and get feedback with these kinds of issues? Have they even run focus groups on this? This is marketing 101.

Here is a smarter way to go about this, make Hilton more money and keep owners happy:

Grandfather open season rates for HGVC system based on year first purchased to keep owners happy and avoid a lawsuit. Regular open season rates as they are now for new buyers. (Grandfathering is how this should have been implemented in the first place.)

and/or

Offer to owners the opportunity to get a standard percentage (e.g. 20%) off of the lowest published rate (e.g. AAA) in the entire Hilton hotel system when booked via Hilton.com.

This way Hilton gets more incremental cash for rooms throughout the system (this would be far more lucrative for Hilton than open season rates). Owners win because they can get Hilton rooms at a lower rate than others. This would be attractive to owners because HGVC is not in all locations. This honors the fact that HGVC owners are Hilton's best customers and advocates and would be more loyal to the system.

This is not perfect but you get the idea. Much better to offer additional benefits and adjust rather than taking stuff away from your best customers.

I am as mad as everyone else who is commenting that HGVC shouldn't have raised the Open Season Rates. I have stressed to HGVC that these are owner/member owned rooms that Owner/Members didn't book during the club reservation period and owner/members should be able to reserve them at severe discounts to the general public. However, they have only raised the Open Season Rates for Hawaii at this point. I love Hawaii and believe that Honolulu is the best place is the world. Hawaii is the most sought after location in the HGVC system. They know they can book these rooms at market rate if Owner/Members don't book them. They probably won't raise the Open Season Rates in Orlando or Vegas since they are lucky to fill the rooms sometimes. They want to make more money and have owner/members use their dollars in locations where there is an abundance of availability.

I don't know how to proceed but I don't like what they are doing since Hawaii is the place that I have used Open Season and would like it to still be available at a severe discount so I receive the benefit I bought when I became an Owner/Member