Proposed internal exchange program and restrictions on resale weeks

[darcy]

I tried to scan through the whole thread, but I apologize if this issue was addressed and I missed it. When I deposit a Marriott week in II, I put in a list of requested trades, some of which may be Marriott and some may not be. I am not sure how that would work with Marriotts out of II...I don't see a way to do simultaneous requests, but if I wait for a response from Marriott and don't get the trade, then maybe it becomes too late for getting one of the II trades. Maybe it forces Request-first instead of Deposit-first trades?

Thanks,
Darcy

 

[Dave M]

Darcy & kokonut -

Please note this wording from post #179 in this thread:

I have no new authoritative info. Based on comments by salespeople (as reported in this forum recently), it appears Marriott is still going ahead with development of this plan. I have no idea (and sales people apparently don't either) as to the effective date.

It would appear extremely unlikely that any implementation would be as early as January 2009.

 

[dougp26364]

I'd go so far as to say there's no way it's going to happen in January of 2009. If it was going to happen, you'd have thought they'd get the information out before many of the resorts had their annual meetings.

Personally, I'm not hopefull that an internal exchange program will come to pass. The system, as it is, really isn't broken. Unless Marriott feels they need some sort of internal exchange program to increase/enhance new sales, I just don't see much incentive for them to move forward with any urgency.

The only other reason for Marriott to go to an internal exchange program would be if enhanced revenue collections to the bottom line of Marriott. I'm not convinced that an internal exchange program will do this unless they want to start collecting additonal club dues to pay for and profit from such a system.

 

[VacationPro]

Let's say that the new system becomes effective as of January 1, 2009. Will those waiting for Marriott to process their ownership transfers be grandfathered? Technically they are not "existing owners" because their transfers have not taken place.

Would Marriott be nice enough to include all that have submitted ownership transfers as of the effective date of the new system? Maybe there is a reason why Marriott is currently taking so long to process transfers. I'm concerned because I am hoping to make a purchase soon.

My bet is that they will use the date of the deed being recorded, regardless of whether they have recognized the new owners in their system as of that day.

 

[Dean]

I tried to scan through the whole thread, but I apologize if this issue was addressed and I missed it. When I deposit a Marriott week in II, I put in a list of requested trades, some of which may be Marriott and some may not be. I am not sure how that would work with Marriotts out of II...I don't see a way to do simultaneous requests, but if I wait for a response from Marriott and don't get the trade, then maybe it becomes too late for getting one of the II trades. Maybe it forces Request-first instead of Deposit-first trades?

Thanks,
Darcy

No way to know how or if things will change. If Marriott adopts any type of true internal trading system, it would likely be separate from Marriott and if so, you'd have the choice of trading with Marriott or through II. If done this way, It's likely we'd lose our internal trading preference with II. Other than a points system, I can't imagine how Marriott could do much to truly restrict new owners and see no way they could restrict resale buyers differently than others for their home resort.

 

[jimf41]

Other than a points system, I can't imagine how Marriott could do much to truly restrict new owners and see no way they could restrict resale buyers differently than others for their home resort.

Everyone seems to think that in order to enhance new owners to buy developer instead of resale they have to put some restrictions on resale owners. The six month reservation period for resale owners has been mentioned early on in this thread. From my conversations with the corporate sales office this idea has been largely discarded mainly due to huge opposition from owners.

Put yourself in Marriott's position and address the problem. It's hard for them to convince current owners to buy another week at 38k when Ebay has them being sold for 9.6k. This recently happened at OP and I can't wait to see what the Marriott sales rep says about that at the tour I'm taking tomorrow. True, they can exercise ROFR but with the current market conditions it would be hard for them to buy up every week that's being sold for less than 40% of current developer price. So if you were Marriott what would you do to increase sales?

Well, one way would be to extend the reservation period to developer bought weeks beyond what resales owners can currently use. This costs Marriott nothing. In their sales pitch they can counter the resale argument by saying that resale owners will pick their weeks after the developer bought weeks have picked their's. A single week owner would then have a good chance of getting a premium week. This is not the case at most Marriott resorts right now from the various discussions I've seen on TUG and other forums.

Marriott has somewhat addressed this problem already by creating Platinum Plus weeks that sell at a high premium. That seems to be working in their new resorts but the older ones like OP it can't be implemented after the fact. At least I don't think it can. OP is sold out but it is still very popular and Marriott would be able to make a fair amount of money selling resales here if they had something to offset the resale price advantage. A friend and non timeshare owner went to the sales tour a few days ago. They pitched hard on Oceana Palms. When he told the rep. that he liked OP better the rep. said he would check his inventory but he didn't think there was anything available at OP right now. I know for a fact that several owners here have listed their OP weeks with Marriott in the resale buy-back program. I would think this indicates that sales on the newer resorts are slowing. That would lead me to conclude that something is in the works to enhance folks to buy developer.

Marriott is in the business of making money. To do that they have to offer a better product at a price people are willing to pay. Right now resales offer essentially the same product at 40-60% less than Marriott. They could increase the points incentives but that costs them money. I don't think any large corporation is looking at increasing their costs right now.

 

[Dean]

Everyone seems to think that in order to enhance new owners to buy developer instead of resale they have to put some restrictions on resale owners. The six month reservation period for resale owners has been mentioned early on in this thread. From my conversations with the corporate sales office this idea has been largely discarded mainly due to huge opposition from owners.

Put yourself in Marriott's position and address the problem. It's hard for them to convince current owners to buy another week at 38k when Ebay has them being sold for 9.6k. This recently happened at OP and I can't wait to see what the Marriott sales rep says about that at the tour I'm taking tomorrow. True, they can exercise ROFR but with the current market conditions it would be hard for them to buy up every week that's being sold for less than 40% of current developer price. So if you were Marriott what would you do to increase sales?

Well, one way would be to extend the reservation period to developer bought weeks beyond what resales owners can currently use. This costs Marriott nothing. In their sales pitch they can counter the resale argument by saying that resale owners will pick their weeks after the developer bought weeks have picked their's. A single week owner would then have a good chance of getting a premium week. This is not the case at most Marriott resorts right now from the various discussions I've seen on TUG and other forums.

Marriott has somewhat addressed this problem already by creating Platinum Plus weeks that sell at a high premium. That seems to be working in their new resorts but the older ones like OP it can't be implemented after the fact. At least I don't think it can. OP is sold out but it is still very popular and Marriott would be able to make a fair amount of money selling resales here if they had something to offset the resale price advantage. A friend and non timeshare owner went to the sales tour a few days ago. They pitched hard on Oceana Palms. When he told the rep. that he liked OP better the rep. said he would check his inventory but he didn't think there was anything available at OP right now. I know for a fact that several owners here have listed their OP weeks with Marriott in the resale buy-back program. I would think this indicates that sales on the newer resorts are slowing. That would lead me to conclude that something is in the works to enhance folks to buy developer.

Marriott is in the business of making money. To do that they have to offer a better product at a price people are willing to pay. Right now resales offer essentially the same product at 40-60% less than Marriott. They could increase the points incentives but that costs them money. I don't think any large corporation is looking at increasing their costs right now.

I'd agree in general. I still don't think Marriott can legally make rules that negatively and directly affect one owner at a given resort compared to another from a reservation and usage standpoint of THAT resort without giving them the ability to attain those same options. Take the 13 month reservation rule, while it does give some the options over others, they still have the potential to buy additional weeks and participate. But they certainly could offer added value options to qualified owners such as the ability to exchange internally to other MVCI resorts and other value added options such as paying for II, trading for points or other exchange options, even trading back to pay dues.

 

[CMF]

Why don't they just give direct buyers more points for their weeks as MFs go up? Nah, too simple.

Charles

 

[sdtugger]

Everyone seems to think that in order to enhance new owners to buy developer instead of resale they have to put some restrictions on resale owners. The six month reservation period for resale owners has been mentioned early on in this thread. From my conversations with the corporate sales office this idea has been largely discarded mainly due to huge opposition from owners.

Put yourself in Marriott's position and address the problem. It's hard for them to convince current owners to buy another week at 38k when Ebay has them being sold for 9.6k. This recently happened at OP and I can't wait to see what the Marriott sales rep says about that at the tour I'm taking tomorrow. True, they can exercise ROFR but with the current market conditions it would be hard for them to buy up every week that's being sold for less than 40% of current developer price. So if you were Marriott what would you do to increase sales?

Well, one way would be to extend the reservation period to developer bought weeks beyond what resales owners can currently use. This costs Marriott nothing. In their sales pitch they can counter the resale argument by saying that resale owners will pick their weeks after the developer bought weeks have picked their's. A single week owner would then have a good chance of getting a premium week. This is not the case at most Marriott resorts right now from the various discussions I've seen on TUG and other forums.

Marriott has somewhat addressed this problem already by creating Platinum Plus weeks that sell at a high premium. That seems to be working in their new resorts but the older ones like OP it can't be implemented after the fact. At least I don't think it can. OP is sold out but it is still very popular and Marriott would be able to make a fair amount of money selling resales here if they had something to offset the resale price advantage. A friend and non timeshare owner went to the sales tour a few days ago. They pitched hard on Oceana Palms. When he told the rep. that he liked OP better the rep. said he would check his inventory but he didn't think there was anything available at OP right now. I know for a fact that several owners here have listed their OP weeks with Marriott in the resale buy-back program. I would think this indicates that sales on the newer resorts are slowing. That would lead me to conclude that something is in the works to enhance folks to buy developer.

Marriott is in the business of making money. To do that they have to offer a better product at a price people are willing to pay. Right now resales offer essentially the same product at 40-60% less than Marriott. They could increase the points incentives but that costs them money. I don't think any large corporation is looking at increasing their costs right now.

I think Marriott correctly saw the big problem with messing around with reservations for resale owners. It is fine to add bells and whistles to usage or trading, but it is completely different to make it more difficult for resales to reserve the same week as direct purchases. And, the dirty secret is that all weeks would be devalued under this system because they become "resales" as soon as the owner decides they need/want to sell. Try purchasing a platinum in Hawaii direct and then needing to sell it for the equivalent of a silver or bronze week price because the resale owner can't reserve any decent platinum weeks. From everything I've read/heard, Marriott realized this would create a huge revolt with owners and backed off of the plan.

Thank goodness.

 

[silkey21]

Marriott and II

If Marriott goes away from II then II will not have Marriott getaway weeks, if that is the case say good night to II -- I guess People are saying to Marriott sales people I can get getaway weeks for $400 why buy another week ?.
If this happens, Marriott will be selling timeshares like crazy since people will not have access to extra weeks.

 

[silkey21]

six month window

I asked my salesperson at the Oceana Palms presentation yesterday about the 6-month window change for resale buyers; she basically said that she would not lower herself to the level of some other salespersons to comment on what was an obvious rumor with no official foundation.

I respected that!

There is no way if someone bought a timeshare and sells the timeshare then that new owner can only can only book six months in advanced instead of twelve. In would have to state that in the original contract if it does't then they can not. They can added it to new sales, not old sales.

By the way this is a great thing for Marriott, but I would not trust Marriott they could take in the better weeks and then try to rent it out.

 

[littlestar]

If Marriott goes away from II then II will not have Marriott getaway weeks, if that is the case say good night to II -- I guess People are saying to Marriott sales people I can get getaway weeks for $400 why buy another week ?.
If this happens, Marriott will be selling timeshares like crazy since people will not have access to extra weeks.

Getaway weeks are usually only offered for off season in locations with plenty of supply.

 

[GrayFal]

Why don't they just give direct buyers more points for their weeks as MFs go up? Nah, too simple.

Charles

If they gave me enough points to stay at a Cat 7 (and now an 8!) for a week - I might consider this a benefit....but getting 90K points for my 2BR L/O Aruba week just doesn't seem like a benefit to me

 

[CMF]

If they gave me enough points to stay at a Cat 7 (and now an 8!) for a week - I might consider this a benefit....but getting 90K points for my 2BR L/O Aruba week just doesn't seem like a benefit to me

Yes, points for direct buyers vs no points for resale buyers has always been the distinction. I say give direct buyers more points!

Charles

 

[Pens_Fan]

There is a local car dealership that lets it be known that their service department has an order that it will work on cars brought in for service.

1. Cars bought from their dealership
2. Cars from out of town/state
3. Cars bought at another local dealership

It's not like they will not work on your car if you buy it from another dealer, but they certainly won't prioritize you.

I don't see how people on this board can't see, or don't want to see, this happening with timeshares.

The developer, much like the car dealership, wants that big upfront piece of money from you. If you don't choose to buy from them, they'll still accept your maintenance fees, but they aren't going to make it easy for you.

Let's say Marriott gets tricky and decides to come up with a way that doesn't invalidate anyones current contract. Instead of the threatened reduction from 12 to 6 months booking your vacation if you have a resale, instead Marriott adds an incentive to all developer purchased units that they can book 15 months out.

You can continue to use your resale purchased timeshare, but probably get worse weeks or try to resell it to someone else. If Marriott think they can resell it, they'll pick it back up at a much reduced ROFR, and resell it at a higher price because now there is a huge difference in value between purchased and resale weeks.

 

[timeos2]

Could be done but must be fair to all

Let's say Marriott gets tricky and decides to come up with a way that doesn't invalidate anyones current contract. Instead of the threatened reduction from 12 to 6 months booking your vacation if you have a resale, instead Marriott adds an incentive to all developer purchased units that they can book 15 months out.

You can continue to use your resale purchased timeshare, but probably get worse weeks or try to resell it to someone else. If Marriott think they can resell it, they'll pick it back up at a much reduced ROFR, and resell it at a higher price because now there is a huge difference in value between purchased and resale weeks.

They could do that BUT to be legal they could only give the priority to the weeks that were purchased under that agreement. IE - if there were 20% of the weeks at the resort purchased under the 15 month rule then only 20% of the units could be reserved that way. The other 80% remain in the 12 month use pool and owners there still have a fair shot at them. No one would have a legitimate complaint. And if you were retail or resale wouldn't matter (as it shouldn't).

We actually own a resort where a similar distinction between owner types / use rules exist due to the various ways it was marketed over the selling years. They use the percentage allotment on each use week and everyone gets a fair chance at what they desire within the rules their week was sold under. Works well and how they bought their week - retail or resale - never plays into the mix. The resort looks out for the owners - not how it was sold - as it should be.

 

[Pens_Fan]

I don't know, call it a loyalty program, and why couldn't they just choose to give it to anyone that had purchased it directly from them.

I just filled out a survey from Marriott and they are talking tiered levels, loyalty programs, and preferencial reservations.

 

[CMF]

No diff.

Extending the time window for reservations made by direct buyers has the same effect as reducing the time window to resale buyers.

I.E. Brown eyed people are better than blue eyed people = blue eyed people are not equal to or better than brown eyed people.

Charles

 

[Latravel]

I.E. Brown eyed people are better than blue eyed people = blue eyed people are not equal to or better than brown eyed people.

It's not a question of better or worse. It's just different. How can you pay thousands less on the resale market, and still expect Marriott to give you the same privileges in the program? The business model can't work that way or people would always buy from the resale market, which would in turn hurt Marriott's sales numbers. Of course I am talking about the Marriott program, not an owners use of their unit, which is their legal right.

There has to be a difference (and one that is meaningful to potential buyers) to justify buying from them and I would BET that Marriott is currently developing creative ways to offer more incentives to customers who purchased direct as part of a loyalty program (just like those in existence with air carriers, hotel chains, grocery stores, department stores, the list goes on...). Why would it be different in the timeshare business world? I just don't think the Marriott corporation is that simple minded and naive.

 

[vacationlover2]

New survey

I just got a survey asking my opinion on a points based system, which I told them I would not like AT all.

 

[sdtugger]

I.E. Brown eyed people are better than blue eyed people = blue eyed people are not equal to or better than brown eyed people.

It's not a question of better or worse. It's just different. How can you pay thousands less on the resale market, and still expect Marriott to give you the same privileges in the program? The business model can't work that way or people would always buy from the resale market, which would in turn hurt Marriott's sales numbers. Of course I am talking about the Marriott program, not an owners use of their unit, which is their legal right.

There has to be a difference (and one that is meaningful to potential buyers) to justify buying from them and I would BET that Marriott is currently developing creative ways to offer more incentives to customers who purchased direct as part of a loyalty program (just like those in existence with air carriers, hotel chains, grocery stores, department stores, the list goes on...). Why would it be different in the timeshare business world? I just don't think the Marriott corporation is that simple minded and naive.

No doubt Marriott can come up some incentives to purchase retail (such as the points swap, internal trading, etc.). But, the one thing they can't do (and I believe they've realized this as it was floated internally and discussed on the net) is change the reservation system to make it different for resale purchasers. A resale "platinum" week that can only be used to reserve poor weeks (akin to gold, silver, or even bronze weeks) would be worth MUCH less and would no doubt be challenged (in my view successfully) in court. Fortunately, it appears that Marriott has seen the light on this one.

 

[timeos2]

Can't do it legally (doesn't mean they won't try)

I.E. Brown eyed people are better than blue eyed people = blue eyed people are not equal to or better than brown eyed people.

It's not a question of better or worse. It's just different. How can you pay thousands less on the resale market, and still expect Marriott to give you the same privileges in the program? The business model can't work that way or people would always buy from the resale market, which would in turn hurt Marriott's sales numbers. Of course I am talking about the Marriott program, not an owners use of their unit, which is their legal right.

There has to be a difference (and one that is meaningful to potential buyers) to justify buying from them and I would BET that Marriott is currently developing creative ways to offer more incentives to customers who purchased direct as part of a loyalty program (just like those in existence with air carriers, hotel chains, grocery stores, department stores, the list goes on...). Why would it be different in the timeshare business world? I just don't think the Marriott corporation is that simple minded and naive.

No, there isn't a difference. SOMEONE (the seller) paid the full freight price at original purchase. Thats the one & ONLY time the developer (in this case Marriott) gets to sell or make rules. After that the property/use rights belong to the buyer, under the term they purchased and agreed to and in there is the right to sell. Not sell an encumbered or altered product but sell what they bought to whoever makes the offer and at whatever price they can get. The paying thousands less is simply being a smart buyer not a reason or justification to try to artificially limit that resale buyers use rights. That theory won't fly and wouldn't stand up to any court challenge.

Trying to make two classes out of already sold product doesn't work and ends up hurting everyone. Not even the lowlife at Wyndham sales was able to successfully pull off that trick. Believe me you don't want Marriott following the Wyndham path of degrading resales (and they had virtually nothing to accomplish that with except a bogus "VIP" moniker that did the trick). Unless you want your ownership to be worth pennies on your retail purchase price dollars.

 

[Dave M]

Please take a look at this new thread on this forum for a peek at some of Marriott's current thinking about a possible points-based internal exchange program and numerous other possible changes that could impact current and future MVCI owners.

 

[Latravel]

It already is different. Resale purchasers cannot exchange for points and no one can challenge that concept so your theory has been tested and proven false. Marriott can change the terms of the program as they wish and they do. The question now is if they want the difference between direct and resale to be even greater than it is now.

 

[davidvel]

It already is different. Resale purchasers cannot exchange for points and no one can challenge that concept so your theory has been tested and proven false. Marriott can change the terms of the program as they wish and they do. The question now is if they want the difference between direct and resale to be even greater than it is now.

Timeos2 is absolutely correct. Nothing is different, nothing is changed, and nothing he says has been proven false. The trade for points "benefit" is not part of the deeded rights, but simply an "incentive" promised to original buyers, which Marriott (not the HOA for your resort), has an obligation to fulfill through its points system, which it CAN change at will.

His original post was responding to the following theory:

Instead of the threatened reduction from 12 to 6 months booking your vacation if you have a resale, instead Marriott adds an incentive to all developer purchased units that they can book 15 months out.

The reservation rules (12/13 month) are specfically set forth in the deeded documents. It is not a matter of "adding a benefit" to reserve 15 months out. The rules are concise and specific. There is no distinction between an original purchaser and resale purchaser in those docs. Marriott cannot change any terms of the deed, CC&Rs and Timeshare declaration. In fact, Marriott is simply a manager for the respective HOAs which actually owes the obligations to owners.

This is akin to a developer giving you a cheap mortage, upgrades or other incentives when buying a house directly from developer. The developer doesn't owe these same incentives to any subsequent purchaser. Simply put Mariott cannot change the rules for reserving, or using your week, which are deeded entitlements.

How can you pay thousands less on the resale market, and still expect Marriott to give you the same privileges in the program?

No resale buyer has a right to be a part of any new exchange program, etc., or any particular priority. However, I expect that Marriott will include resale buyers as there are so many valuable weeks that have been resold that they would need for their program to be sucessful. In a way, this is how Marriott can "recapture" the resale weeks under their control and make new vague promises during the sales pitch about the value of the program (as they do now with the points trade system.)

Of course, resale buyers are entitled to the same deeded rights of an original purchaser no matter what price was paid, no different than neighbors in a condo complex that paid drastically different prices for their unit twenty years apart.