Speculation About Marriott's New Timeshare Structure [merged]

[peppersmom]

[Message deleted. Posting duplicate messages on these forums is not permitted. Dave M, BBS Moderator]

 

[Bear1980]

I wouldn't mind getting into RCI, so we can trade into Disney. Those resorts are nice, and with a little one on the way, it might not be such a bad thing to trade into there once in a while.

 

[dougp26364]

This is why I think any system if it is ever introduced will be a pure point overlay system. Marriott will always sell weeks, except at perhaps new resorts.

I have felt similar about this myself. The only difference being that it very well could be a combination of a points overlay system for the already sold deeded weeks combined with a trust based ownership for all new sales. In that way, deeded week owners could participate in the points based program, Marriott could profit from a small enrollement fee and, Marriott could begin selling a purely points based product without a home resort advantage, allowing it to sell out slow moving projects like Crystal Shores or Willow Ridge in Branson.

 

[dougp26364]

I wouldn't mind getting into RCI, so we can trade into Disney. Those resorts are nice, and with a little one on the way, it might not be such a bad thing to trade into there once in a while.

Since Marriott just renewed it's contract with Interval, I doubt you'll see an RCI affiliation anytime soon. IMHO, wanting to get into the few DVC resorts that exist would be a poor excuse to switch to RCI.

 

[Bear1980]

I guess my reasons are selfish, Doug.

I wouldn't mind staying at some of the Hiltons too.

 

[Bear1980]

For what it is worth, I emailed my Marriott sales guy who I've become friends with over the years. I was told that they are being trained on the new system in June for a July rollout.

Take it for what it's worth. I didn't get any other info about details other than it being optional to the owner whether or not they wanted to switch.

 

[dougp26364]

I guess my reasons are selfish, Doug.

I wouldn't mind staying at some of the Hiltons too.

That's why we also own a few points in Hiton's program. I really love our Marriott property's but, it's not always a good idea to put all the eggs into one basket.

 

[lrf]

i was just warned by marriott sales about resales come june

Although I don't believe the salesperson referred to in the OP was accurate, particularly with respect to assigning units at a home resort, the salesperson was almost certainly accurate that big changes are forthcoming.

It is pretty clear that Marriott will be making some changes in June or, if the new program is delayed, sometime soon thereafter. What will the new program be? We don't know very much. What does seem pretty clear is that there will be a points program that will apply to many (most?) future timeshare sales by Marriott, will involve exchanging based on points and will be available to current Marriott timeshare owners - for a price. That price is supposed to be nominal (whatever that means) for those who have purchased their timeshares from Marriott and probably quite a bit more expensive for those who have purchased resale. The changes are not likely to affect the privileges that we are all guaranteed by the legal documents of our respective resorts. Rather they will likely offer an exchanging “enhancement” for those who wish to participate.

How do we know that some big changes are coming? We first heard about the changes almost two years ago. I have had some clearly-in-the-know Marriott people confirm those changes to me on several occasions over the past two years and I reported that information here each time. What we are now hearing is about the same as what I originally heard way back when. The only difference is that the effective date has been delayed by about six months, not unreasonable for such a big project in a down economy. Further, Fletch, a much respected member of the TUG community in past years who has just resigned from a very lucrative sales position at Marriott, has confirmed that a new program will be forthcoming this year (see the above link to his posts).

All we can do is wait to see what the details are and continue to speculate.

As to whether the changes will be good or bad, I'm certain the answer is a resounding YES! There is no way to be sure, but I'm guessing that platinum week owners at top resorts who bought from Marriott will love the new program and resale owners of bronze and silver weeks will hate it.

I realize these are old posts, but it seems that the marriott sales team is still using the same threats. I have decided to look resale versus buying direct thanks to information on TUG. My response from Marriott sales was to extend my deadline and to warn:

"i'm glad you didn't purchase that resale you told me about since come June anyone with weeks not purchase through Marriott will have a very difficult time going forward. I don't know what all the means, except that it came from pretty high sources"

I guess he has convinced me i should wait and see what the change means!

 

[dougp26364]

I realize these are old posts, but it seems that the marriott sales team is still using the same threats. I have decided to look resale versus buying direct thanks to information on TUG. My response from Marriott sales was to extend my deadline and to warn:

"i'm glad you didn't purchase that resale you told me about since come June anyone with weeks not purchase through Marriott will have a very difficult time going forward. I don't know what all the means, except that it came from pretty high sources"

I guess he has convinced me i should wait and see what the change means!

Of course he wants you to wait. Marriott sales wants to scare off resale buyers. This despite the fact they SELL the idea that you can always SELL your timeshare if you don't want it anymore. All timeshare salesmen talk out of both sides of their mouths when it comes to resales.

Next time start out by asking them this. If I buy from you today and, say in 10 years, something happens and I can't use my timeshare anymore, can I sell it to someone else? Once they enthusiastically answer yes. Then say I guess the thing to do is find someone who wants to sell their unit and see if they'll take less than what you're trying to sell this unit for. Then sit back and watch the confunsion as they try to figure out how to get out of that one.

Should they start running down resales, then you can hit them with why buy something that's worthless if I need to resell it later? You can really get them confused, back peddling and side stepping if you're one step ahead of them.

The best thing you can do is buy where you are most likely to go. Then you don't have to worry about exchange values or internal exchange systems. You still have your deeded right to use your week and Marriott can't change that or take that away from you. If you're buying to exchange, remember, the exchange playing field changes frequently. This thread is evidence to that potential for change.

 

[dioxide45]

Next time start out by asking them this. If I buy from you today and, say in 10 years, something happens and I can't use my timeshare anymore, can I sell it to someone else? Once they enthusiastically answer yes. Then say I guess the thing to do is find someone who wants to sell their unit and see if they'll take less than what you're trying to sell this unit for. Then sit back and watch the confunsion as they try to figure out how to get out of that one.

Should they start running down resales, then you can hit them with why buy something that's worthless if I need to resell it later? You can really get them confused, back peddling and side stepping if you're one step ahead of them.

The sales folk are slick and they have a response for everything. Their answer to all of this will be "Marriott will sell it for you" it isn't worthless.

 

[m61376]

The sales folk are slick and they have a response for everything. Their answer to all of this will be "Marriott will sell it for you" it isn't worthless.

"Then I suppose you won't have any problem putting that in writing and, of course, the time frame."
:hysterical:

 

[brigechols]

"With that written guarantee to sell the unit in a certain time frame, for the sake of completeness, be sure to include a provision that you will purchase the unit if it does not sell" :hysterical: :rofl:

 

[lrf]

Thanks to all for suggestions and education. my 15% marriott celebration discount price lock is now gone.... i will find the right resale

 

[m61376]

Thanks to all for suggestions and education. my 15% marriott celebration discount price lock is now gone.... i will find the right resale

and welcome to Tug
You might want to use a few dollars of what you saved and join for access to the review section before making a purchase.

 

[Fredm]

Marriott had its 1st Quarter conference call this morning.

Stated that there will not be any investment in the timeshare business for the "foreseeable future".

Current weekly interval sales inventory is projected to last ~3 years.

Timeshare sales margins are improving. Closing efficiencies have improved from 8% to 11%, plus operating expenses are down.

Rental business has increased 9%.

I don't know. This rumored point system is not a matter of national security. If a new product introduction were on the horizon, they would have mentioned it while providing guidance to the investment community. Marriott was forthcoming about guidance on other business matters through 2011.

 

[tlwmkw]

Fredm,

Interesting points. If Marriott saw this change as a huge new revenue stream then I would think that they would be letting investors know. It does make you wonder if anything will transpire.

tlwmkw

 

[SueDonJ]

I think Marriott would have problems if they announced this rumored system in today's conference call before giving owners official notice, especially because this informed opinion disagrees that there is a need to announce it to stockholders.

 

[lrf]

and welcome to Tug
You might want to use a few dollars of what you saved and join for access to the review section before making a purchase.

i already spent those $15. just hadn't updated my profile. thanks for noticing

 

[Fredm]

I think Marriott would have problems if they announced this rumored system in today's conference call before giving owners official notice, especially because this informed opinion disagrees that there is a need to announce it to stockholders.

There is not a regulatory requirement that it be disclosed.

But, they do provide "guidance" to the financial community. Every reasonable attempt is made to offer security analysts that cover the company with information about what can be expected in future quarters.
All of 2010, and into 2011, was discussed for each of Marriott's business segments.

What's to hide about a new timeshare product? Especially if it is to be rolled out in the next quarter?

Oh, I get it! Marriott is telling their sales force, who are telling their sales prospects to expect an announcement in June. But, they are not informing timeshare owners, who must be consulted before they tell the people who advise the owners of the company (the stock holders) about it.

Does that really make any sense to you? Not to me.

 

[billymach4]

Marriott had its 1st Quarter conference call this morning.

Stated that there will not be any investment in the timeshare business for the "foreseeable future".

Current weekly interval sales inventory is projected to last ~3 years.

Timeshare sales margins are improving. Closing efficiencies have improved from 8% to 11%, plus operating expenses are down.

Rental business has increased 9%.

I don't know. This rumored point system is not a matter of national security. If a new product introduction were on the horizon, they would have mentioned it while providing guidance to the investment community. Marriott was forthcoming about guidance on other business matters through 2011.

Oh I know! They are going to show the sales force how to find a new career in sales since Marriott will no longer be building any new units. That is what this big 2 week meeting/ Session/ pow wow/ seminar in June is all about!

 

[dougp26364]

I had a night off for a change and, as is my habit, thoughts of vacation and vacation planning are something I gravitate towards. Having given all the rumors, doomsday predictions et... much thought, I've come to a few conclusions.

1. Who cares. Marriott is going to make changes. All timeshare organizations make changes. If they don't, they die. Of course we're in a decent position with our Marriott ownership because we're still interested in using the Marriott weeks we purchased but.......times change and I'm sure that won't always be the case.

2. When looking over my options, I have three of 7 units that are in two different points based exchange systems, HGVC and DRI. Guess which is the more flexible and offers me the greatest options, points or weeks. If you guessed points your right. There's a great deal more manipulation I can do with points over Marriott's current weeks based program.

Points offer advantages.

1. I can make internal exchanges and avoid paying RCI or Interval exchange fee's

2. I can take advantage of slower seasons, which require fewer points.

3. I can move up to higher seasons by combining points from all my units or combing points from different years.

4. If I can't use my points this year, I can save them into next year. If things change I can borrow them back into this year.

5. I can take short trips less than a week.

6. I'm not locked into traditional arrival departure days. This allows me flexibility to take advantage of lower airfares.

7. If I have a late flight departure, which is often the case for us in Hawaii, I can extend my stay to 8 nights and have use of the resort for that last day. It allows me to leave at my leasure rather than having to find something to do and carry all my luggage around town in my car (or check it with the resort bell boys).

8. If I don't need to use all my points for the stays I want, I can use those points to offset the costs of other services like rental cars, convert to FF miles, save for a bigger vacation next year or maybe knock a few dollars off a cruise we've been wanting to take.

9. If I exchange through Interval International and I wait until the Flexchange period, the point cost for a week is 50%. That would allow us two weeks of vacation for the price of one if I'm flexible.

10. There is no waste in value. If I hold a higher value resort and want to go to a resort with fewer amenities, maybe an area that doesn't have a lot of high end resorts or, maybe I want to go in a lower season (say Gold rather than Platinum), I don't have to waste my entier high value week to get that exchange.

Sure I know everyone's nervous about the cost of the new program, can week keep our deeds, home resort advantage and where our weeks will fall on the points valuation chart but, we're pulling a Peter Pan and fighting with our shadow on the wall. There's nothing solid to hang our hats on.

It's good to talk about it. It's good to look at what other systems are doing. It's good to have knowledge so that once it's official, we'll be able to ask good questions. It's foolish to worry about something that hasn't happened yet.

I'm enouraged that Marriott is considering a points based system. If it's a good one we may have five of our seven weeks in points based systems, leaving only the two Branson weeks we own as traditional points based exchange weeks. In my mind that coud be a very good thing for us.

 

[dioxide45]

I had a night off for a change and, as is my habit, thoughts of vacation and vacation planning are something I gravitate towards. Having given all the rumors, doomsday predictions et... much thought, I've come to a few conclusions.

1. Who cares. Marriott is going to make changes. All timeshare organizations make changes. If they don't, they die. Of course we're in a decent position with our Marriott ownership because we're still interested in using the Marriott weeks we purchased but.......times change and I'm sure that won't always be the case.

True, we are in the same position.

2. When looking over my options, I have three of 7 units that are in two different points based exchange systems, HGVC and DRI. Guess which is the more flexible and offers me the greatest options, points or weeks. If you guessed points your right. There's a great deal more manipulation I can do with points over Marriott's current weeks based program.

I don't own a points system. So can't compare.

Points offer advantages.

1. I can make internal exchanges and avoid paying RCI or Interval exchange fee's

Who is to say that Marriott won't charge a per transaction fee?

2. I can take advantage of slower seasons, which require fewer points.

I can also do this in the Marriott weeks system. Using our lock off and getting two larger units. I am careful not to say upgrading, because that is not what we are doing, we are exchanging a good trading week for a larger unit in a dog season. People think that only unit size counts when "working the system". Two weeks for the price of one. Perhaps this is also possible in a points system. But there is flexibility in both.

3. I can move up to higher seasons by combining points from all my units or combing points from different years.

I can do this too in weeks, perhaps not super prime weeks, but we aren't looking for those weeks either.

4. If I can't use my points this year, I can save them into next year. If things change I can borrow them back into this year.

Same thing in weeks. If I can't use my week this year, I deposit it in II and can use it for two to three years.

5. I can take short trips less than a week.

Can do this too with IIs short stay exchange, and actually get credit for 7 nights instead of the actual nights stayed.

6. I'm not locked into traditional arrival departure days. This allows me flexibility to take advantage of lower airfares.

Points does have a slight advantage here, though there are ways to work the Marriott split stay option to accomplish the same thing.

7. If I have a late flight departure, which is often the case for us in Hawaii, I can extend my stay to 8 nights and have use of the resort for that last day. It allows me to leave at my leasure rather than having to find something to do and carry all my luggage around town in my car (or check it with the resort bell boys).

No argument here, we would have to book an extra night under the weeks system.

8. If I don't need to use all my points for the stays I want, I can use those points to offset the costs of other services like rental cars, convert to FF miles, save for a bigger vacation next year or maybe knock a few dollars off a cruise we've been wanting to take.

I wouldn't think these would tend to be a great use of points. Though if they were just going to waste...

9. If I exchange through Interval International and I wait until the Flexchange period, the point cost for a week is 50%. That would allow us two weeks of vacation for the price of one if I'm flexible.

Will Marriott work the same way though, or will one just be depositing a regular week in to II?

10. There is no waste in value. If I hold a higher value resort and want to go to a resort with fewer amenities, maybe an area that doesn't have a lot of high end resorts or, maybe I want to go in a lower season (say Gold rather than Platinum), I don't have to waste my entier high value week to get that exchange.

I can see this, a lot of dedicated 3BR owners have to often trade down to exchange out of their home resort.

Sure I know everyone's nervous about the cost of the new program, can week keep our deeds, home resort advantage and where our weeks will fall on the points valuation chart but, we're pulling a Peter Pan and fighting with our shadow on the wall. There's nothing solid to hang our hats on.

It's good to talk about it. It's good to look at what other systems are doing. It's good to have knowledge so that once it's official, we'll be able to ask good questions. It's foolish to worry about something that hasn't happened yet.

I'm enouraged that Marriott is considering a points based system. If it's a good one we may have five of our seven weeks in points based systems, leaving only the two Branson weeks we own as traditional points based exchange weeks. In my mind that coud be a very good thing for us.

 

[dougp26364]

The main difference between doing the same thing in weeks and doing it in points is that you can actually plan it out with points. You know the value. While I can do the same thing with Marriott's weeks based system (we make the same moves you do in locking out and trading "up"), it's all guess work. With points I can look directly at Interval's TDI charts and I know what I'm going to pay. Lower demand, lower points requirements. Select the correct week and save points. Select the wrong week and pay a premium.

HGVC has an internal exchange fee but, it's not nearly what RCI's exchange fee's are. Both programs we're in have membership fee's as well. These are still less than paying multiple exchange fee's through either RCI or Interval. If Marriott's going to be competitive, they'll have to be competitive on price.

As to Interval's short stays, I don't think you've really taken a good look at that program. It is extremely limited in availability. Having a short stay alternative internally for any Marriott resort would be a huge advantage over Interval's option and the current Marriott split week option. Try searching Interval's short stay options online and see how you feel about it.

None exchange options like rental cars, cruises et....are never a great value unless you get the vacations you want AND have extra points left over. That's what's happened to use with DRI. I'm still getting the exchanges I was getting under their weeks program but, I still have left over points. 15,000 points will get me the two 2 bedroom exchanges I was asking for with our weeks. After that I have 11,500 points left over. The gives us our exchanges PLUS extra value we didn't get before. Even if I pay 10 cents per point and only get 6 cents of value in return, it's 6 cents per point more than I was getting by just exchanging week for week.

 

[sparty]

Marriott had its 1st Quarter conference call this morning.

Stated that there will not be any investment in the timeshare business for the "foreseeable future".

Current weekly interval sales inventory is projected to last ~3 years.

Timeshare sales margins are improving. Closing efficiencies have improved from 8% to 11%, plus operating expenses are down.

Rental business has increased 9%.

I don't know. This rumored point system is not a matter of national security. If a new product introduction were on the horizon, they would have mentioned it while providing guidance to the investment community. Marriott was forthcoming about guidance on other business matters through 2011.

Will have to check if they have a recorded replay of the call, I suspect they probably do.

I would say if they didn't disclose consideration was underway regarding changes to the rewards program and it could have a material impact on shareholder value, they could suffer legal liabilities regarding safe harbour.

No investment in timeshare going forward? What about Lakeshore Reserve? What type of color are they giving in their shareholder meeting?

 

[Fredm]

Will have to check if they have a recorded replay of the call, I suspect they probably do.

Yes they do. On Marriott.com.

Sign up under Investor Relations.