Why is Marriott Vacations struggling?

[Superchief]

The VC points system has already caused inventory management nightmares and I think most of us are having difficult times getting the reservations we want (points and weeks) even 12-13 months in advance. I recently could only get a Sunday check in at Oceana Palms on 10/27 next year on the release date, not exactly a prime demand week. Only MVC knows how they allocate inventory, but I would trust them better if they were more transparent regarding their policies. The last thing we need is adding more complexity.

 

[ljmiii]

While i am sure having greater inventory availability on short notice would appeal to some, i am not sure that's really the main objection of younger buyers. In the conversations about travel with younger co-workers, many of them do book on short notice, but they do the booking based on where they find deals and discounts..

The other thing i hear alot is the desire to see lots of new places, and while many of the timeshare brands have a lot of resorts, the overall scope of places you can effectively visit with timeshares is a lot more limited than when using hotels and AirBNB, etc.

I come back to the idea that if MVC were serious about attracting younger customers they would revamp their Abound Point to Bonvoy Point offering and market it as 'Prepaid, discounted travel anywhere in the world' (or some such). Marriott International has well over 8,000 locations not counting their new Apartments by Marriott product. Most of the locations are available on short notice and they have a number of brands that target young travelers - brands like Moxy, W, and (so I've been told) Springhill Suites.

Today I can buy 130K Bonvoy points for $1250. Last month I could have bought 140K for that same $1250 and I've often seen 150K for $1250. Without having to own anything or have any closer ties to Marriott than a points.com account. With Abound Point MFs approaching 80 cents a point there is no reason on god's green earth that MVC couldn't make money selling Abound Points at over $17 a point and allowing people to convert them to Bonvoy Points at will at 80 to 1.

 

[goodbadugly]

Agree, the product simply isn't that attractive anymore. Certainly not at $15-$16 per point. It's too hard for families with kids in school to book anything and it seems MVC is flat footed on addressing other cohorts i.e. seniors with money, in good health and want to travel. They seem to be stuck in a version of family that hasn't existed in more than 20 years. The cross ties with Collette, cruises, special events, et al are sorely lacking. . I bought in the early 2000s and have enjoyed it but the thought of now paying over $140K for what we hold is absurd. (Maintenance fees, etc are a whole other category) A minimum buy of 2500 pts is $40K and that doesn't really get one much of anything. No doubt recovering from COVID restrictions has hurt sales but MVC really needs to make the product less stodgy which means more than window dressings of digital enhancements and new technology. Not only is there no sizzle, there's no steak.

The options to use MVC points outside of properties (e.g. cruises, tours, even hotel rooms) are waaaay over priced. When you call them on this they respond by saying "what else are you going to do with your points"?

 

[Dean]

I come back to the idea that if MVC were serious about attracting younger customers they would revamp their Abound Point to Bonvoy Point offering and market it as 'Prepaid, discounted travel anywhere in the world' (or some such). Marriott International has well over 8,000 locations not counting their new Apartments by Marriott product. Most of the locations are available on short notice and they have a number of brands that target young travelers - brands like Moxy, W, and (so I've been told) Springhill Suites.

Today I can buy 130K Bonvoy points for $1250. Last month I could have bought 140K for that same $1250 and I've often seen 150K for $1250. Without having to own anything or have any closer ties to Marriott than a points.com account. With Abound Point MFs approaching 80 cents a point there is no reason on god's green earth that MVC couldn't make money selling Abound Points at over $17 a point and allowing people to convert them to Bonvoy Points at will at 80 to 1.

The main problem with the value when using points for cash type options is actually in converting those points into cash. They have to use the abound points to reserve MVC then rent that reservation through Bonvoy or similar (? encore packages). When they do, others have their hand out. I don't know the % commission for MVC to rent but I suspect it's 50%. Plus any points that don't end up as a rental is simply a loss to the system. DVC functions the same way and I know their commission is 50%. I suspect Collette gives a 20% discount on their tours which is why the numbers are usually a little more favorable than for cruises. IMO it's unrealistic to expect cash type usage to ever be a truly viable option. BTW, DVC is in a much better position to control the value than is MVC but they don't either. In the past I spent the day at DVC's Celebration headquarters and specifically asked about this stating that if DVC was important enough to Disney to get a reasonable discount on other Disney products like hotel reservations if they push it. The bottom line was that they weren't willing to push it and that to offer "all the Disney hotels it wasn't possible without limiting the options, which "members did not want".

 

[ljmiii]

The main problem with the value when using points for cash type options is actually in converting those points into cash.... I don't know the % commission for MVC to rent but I suspect it's 50%...

I guess my question is why? What I tried to make clear (and evidently didn't) is that any random person off the street with no affiliation to MVC nor Marriott International can buy Bonvoy Points for less than a penny a point. How is it possible that MVC couldn't negotiate a better rate with Marriott Int'l?

I understand that doing so would require that MVC consider the lack of last minute availability to be a deterrent to sales to younger buyers. And that it is a sufficient deterrent to actually require action on MVC's part. But that seems to be the thesis for this strand of the thread.

 

[Dean]

I guess my question is why? What I tried to make clear (and evidently didn't) is that any random person off the street with no affiliation to MVC nor Marriott International can buy Bonvoy Points for less than a penny a point. How is it possible that MVC couldn't negotiate a better rate with Marriott Int'l?

I understand that doing so would require that MVC consider the lack of last minute availability to be a deterrent to sales to younger buyers. And that it is a sufficient deterrent to actually require action on MVC's part. But that seems to be the thesis for this strand of the thread.

Short answer IMO, greed, though likely even more on the Bonvoy side than MVC. Given the realities there are simply too many draws on the cash generated to make this a workable option. Remember there is far more separation between the 2 entities now than years ago. It can be nice to have options when it's use or lose points but I've never seen a timeshare with a cash type exchange option that was a reasonable option. About twice I've seen isolated situations with DVC where the return was reasonable but even then it was less than rental return. With Bluegreen early on I could use points to pay fees the Maintenance fee above the Maintenance fees at the time but that was short live and even then it was only marginally better. Bottom line IMO, it's Fluff, simply a sales gimmick. And while trading weeks for points years ago wasn't too bad, I've never seen a situation where it was truly reasonable. I know some disagree for some options from the early years but that's my opinion.

 

[RunCat]

I come back to the idea that if MVC were serious about attracting younger customers they would revamp their Abound Point to Bonvoy Point offering and market it as 'Prepaid, discounted travel anywhere in the world' (or some such). Marriott International has well over 8,000 locations not counting their new Apartments by Marriott product. Most of the locations are available on short notice and they have a number of brands that target young travelers - brands like Moxy, W, and (so I've been told) Springhill Suites.

Today I can buy 130K Bonvoy points for $1250. Last month I could have bought 140K for that same $1250 and I've often seen 150K for $1250. Without having to own anything or have any closer ties to Marriott than a points.com account. With Abound Point MFs approaching 80 cents a point there is no reason on god's green earth that MVC couldn't make money selling Abound Points at over $17 a point and allowing people to convert them to Bonvoy Points at will at 80 to 1.

As much as I would like to agree with this, this would result in a reduction of available Owner's inventory. Arguably, there are handful of buckets that have access to the inventory: owner's that paid $$, MVC that is trying to sell that inventory, II that was given inventory from an Owner, and Bonvoy point conversions. Each of these buckets want to get the highest return on their investment and strive to get the prime weeks. And unfortunately the way that those weeks are allocated are behind a curtain. Things were much more predictable and transparent when everyone owned a fixed week. With weeks in a trust, and with inventory allocation controlled by a self-interested party, it is now much more messy.

 

[Ralph Sir Edward]

When you try to be everything for everybody, you end up pleasing nobody. . .

Every change to the timeshare concept has caused problems, along with the benefits. Plus, those problems build on each other, with every change.

Marriott, being at the forefront of timeshares, has taken it to 11. . .

 

[Retired2025 aka AlmostRetired]

MVCI has 3 challenges right now that can easily be fixed.
The prices of a point is to high, the MF is high. the inventory for prime weeks is to low and I will add the value for reward point usage is poor. All our areas are within MVCI's control to fix and by doing so puts MVCI back in the value game. I ran a regional sales organization at IBM and started up a new business area in my current role. This is with minimal thought (and it might reflect it). Every company struggles at some point. MVCI has smart people and I am sure they are working on what will be the next iteration of timeshares. MVCI will look different but they will be around a long time (maybe wishful thinking on my part).

The price of a point is to high. If you can't raise the bridge, you got to lower the water. I am guessing that the S part of SG&A has the highest impact on the price of a point. As you raise the price, the conversion rate of a buyer must go down which means you need to have more traffic. More traffic means more incentives. They are getting better at sales presentations outside of a sales center but that is never going to be enough. Completely change the sales model. Significantly lower the price of a point and develop a more efficient and effective sales model that lowers the S in SG&A. Tele sales Go back to the 2010 costs. if you believe that the trust is made up of lower value weeks, at 10 a point at a lower sales cost leaves a lot of room for profit and well above the underlying value.

Bundle the lower seasons with points to get the price per point even lower. You will be getting the high MF per point off the books. You can also buy down the MF for 5 years by giving a not to exceed the current MF for 5 years for purchases over 2000 points. It than goes to prevailing rates. Most people don't think beyond tomorrow. There are other ways to address the MF for points.

Stop relying on enrolled owners which you have no control over to drive platinum inventory. Start exercising ROFR at higher prices. A GO that has 4500 points is 45000 at 10 per point and oceanfront even higher points and value. You can pick it up at 18K (oceanside) to 23K (oceanfront). This is just an example. This applies to most Platinum weeks.

As far as reward point exchange, I am not sure what they can do but depending on their profit margins, they should be able to do better.

 

[dioxide45]

Bundle the lower seasons with points to get the price per point even lower. You will be getting the high MF per point off the books. You can also buy down the MF for 5 years by giving a not to exceed the current MF for 5 years for purchases over 2000 points. It than goes to prevailing rates. Most people don't think beyond tomorrow. There are other ways to address the MF for points.

Those weeks they are bunlding with trust points aren't even on the books. These are weeks owned by weeks based owners who are using the Marriott resale department. The only reason I see them now offering low season weeks with low number of points is deparation. Sell any amount of points to bring in any amount of money. In the past they required you to buy a bundle that included the same number of points that the bundled resale week could elect for. Based on past experience they started to bundle blue season DSV weeks if you bought just 1,000 trust points and recnetly in this or perhaps another thread it was reported you could buy only 500 trust points and bundle it with a low season week. Those weeks aren't owned by Marriott and the only reason I can see them offering a bundle with as little as 500 points is desperation. I suspect fourth quarter sales will be down considerably, perhaps due somewhat to lower tour flow in Maui due to the fires but also the fact that travel is down and people probably aren't spending as much on their product.

 

[Retired2025 aka AlmostRetired]

Those weeks they are bunlding with trust points aren't even on the books. These are weeks owned by weeks based owners who are using the Marriott resale department. The only reason I see them now offering low season weeks with low number of points is deparation. Sell any amount of points to bring in any amount of money. In the past they required you to buy a bundle that included the same number of points that the bundled resale week could elect for. Based on past experience they started to bundle blue season DSV weeks if you bought just 1,000 trust points and recnetly in this or perhaps another thread it was reported you could buy only 500 trust points and

I was not suggesting things continue business as usual in any area I made suggestions on. If one believes MVCI is struggling, you can’t business as usual out of it. If poor point to MF is burdening trust MF, move them out by bundling them and temporarily buy done the MF. ,

 

[jwalk03]

I was not suggesting things continue business as usual in any area I made suggestions on. If one believes MVCI is struggling, you can’t business as usual out of it. If poor point to MF is burdening trust MF, move them out by bundling them and temporarily buy done the MF. ,

Are they even able to remove weeks from the trust and sell them?

 

[Retired2025 aka AlmostRetired]

Are they even able to remove weeks from the trust and sell them?

If it is like any other land trust the answer is yes. I guess they could have added a prevision that prevents it but I would doubt.

 

[jp10558]

What I tried to make clear (and evidently didn't) is that any random person off the street with no affiliation to MVC nor Marriott International can buy Bonvoy Points for less than a penny a point.

I have to ask - how? And kind of also why? I only know about HHonors points, but I have no idea how you'd buy points, and I have to guess pricing them would be complicated.

 

[Fasttr]

I have to ask - how? And kind of also why? I only know about HHonors points, but I have no idea how you'd buy points, and I have to guess pricing them would be complicated.

Marriott Bonvoy Customer Service and Online Help

help.marriott.com

Safari in Africa to the Luxury of Bora Bora: When to Buy Marriott Bonvoy Points With a 30% Bonus (0.96¢ Each)

Marriott's latest early bird special promotion offers the opportunity to buy points for just 0.89¢ per point. That opens the door to stays at the most lavish Marriott properties at a fraction of the cost, such as going on a safari in Africa or scoring inexpensive domestic getaways for less than...

awardwallet.com

 

[okwiater]

I think the root cause of all these issues is trying (or pretending?) to make the square peg “timeshare” fit the round hole of “flexibility.” This goes all the way back to the creation of floating weeks, and more recently the points systems. Quite simply, timesharing is a zero sum game where one owner’s “great trade” is another owner’s significant loss. Added to the mix are numerous publicly traded middle-men extracting their pound of flesh on every transaction, and hordes of lawyers administering the mountain of entities spun up to encapsulate the underlying ownerships.

Don’t get me wrong, I’ve done very well with my SPG/Vistana contracts, but I am well aware that my gain was someone else’s loss. TUGgers in general learn to get value from their ownerships by working the rules of the systems to their advantage, but we all know that if every owner did the same things we were doing, the house of cards would collapse.

At the end of the day, timesharing has become divorced from its original purpose: prepaid, predictable, cheap vacations for people willing and able to commit in advance. All this discussion of adjustments to booking windows, etc. to further disguise the product as something it can never be is just lipstick on the pig. I think the big timeshare companies know this too… but it gave them something to sell for the past 20 years, so it apparently fulfilled its purpose.

 

[CPNY]

You absolutely still do not get it. The hot toy isn't the points. Those are the currency used to buy the toy. The hot toy is the stay at the desirable location at the desirable time. You want to talk about people being selfish, make sure you look in the mirror. You're the one trying to ask for things your way so you can book more last minute instead of planning ahead. You want to reward tbe procrastinator and penalize the responsible planner. Except your "solution" still won't help the poor planner unless they get lucky by happening to log in to search at the right moment. As I said, I'm not always able to be the year-out planner, but I don't begrudge them when they come out ahead of me.

Calling those who cannot plan a year out “procrastinators” is a bit off and elitist, I am not looking to penalize anyone unlike those of you who like to see the owners who cannot plan a year out “penalized”. Not sure how it’s selfish to want to see ALL owners (the early planners and those who can’t plan early) with equal opportunities to book high demand weeks, but ok.

With that being said, Have a blessed holiday season and a wonderful New Year.

 

[Ralph Sir Edward]

I think the root cause of all these issues is trying (or pretending?) to make the square peg “timeshare” fit the round hole of “flexibility.” This goes all the way back to the creation of floating weeks, and more recently the points systems. Quite simply, timesharing is a zero sum game where one owner’s “great trade” is another owner’s significant loss. Added to the mix are numerous publicly traded middle-men extracting their pound of flesh on every transaction, and hordes of lawyers administering the mountain of entities spun up to encapsulate the underlying ownerships.

Don’t get me wrong, I’ve done very well with my SPG/Vistana contracts, but I am well aware that my gain was someone else’s loss. TUGgers in general learn to get value from their ownerships by working the rules of the systems to their advantage, but we all know that if every owner did the same things we were doing, the house of cards would collapse.

At the end of the day, timesharing has become divorced from its original purpose: prepaid, predictable, cheap vacations for people willing and able to commit in advance. All this discussion of adjustments to booking windows, etc. to further disguise the product as something it can never be is just lipstick on the pig. I think the big timeshare companies know this too… but it gave them something to sell for the past 20 years, so it apparently fulfilled its purpose.

The current situation is based on the past situation of having more unsold timeshare weeks to allocate. This led to there being better "selection" of weeks to book. This is no longer the case,as those weeks are now in the DC trust, and as many points as possible are being sold against them. Those points are being sold as "prime" points, but not backed by the amount and level of stays being "sold". (Buy the points and go to Hawaii - but there aren't enough Hawaii weeks available to match the demand.) Marriott timeshares doesn't care, as long as they make the sale. Then if only a "mud week" is available, it's not Marriott's fault. They promised a week, and delivered a week. They didn't guarantee a prime week. . .

 

[jwalk03]

Development of new resorts that offer high demand inventory would be very helpful even though any large scale development seems very unlikely when its so much cheaper for them to just re-acquire weeks for next to nothing.

 

[okwiater]

The current situation is based on the past situation of having more unsold timeshare weeks to allocate. This led to there being better "selection" of weeks to book. This is no longer the case,as those weeks are now in the DC trust, and as many points as possible are being sold against them. Those points are being sold as "prime" points, but not backed by the amount and level of stays being "sold". (Buy the points and go to Hawaii - but there aren't enough Hawaii weeks available to match the demand.) Marriott timeshares doesn't care, as long as they make the sale. Then if only a "mud week" is available, it's not Marriott's fault. They promised a week, and delivered a week. They didn't guarantee a prime week. . .

You're absolutely correct--which underscores my point that selling "flexible" floating or points systems has just been to disguise the underlying product. Timeshares were never designed to be used the way they've been selling them. There was already a "points" system for flexible travel to destinations around the world, and it's called "cash."

 

[Eric B]

Calling those who cannot plan a year out “procrastinators” is a bit off and elitist, I am not looking to penalize anyone unlike those of you who like to see the owners who cannot plan a year out “penalized”. Not sure how it’s selfish to want to see ALL owners (the early planners and those who can’t plan early) with equal opportunities to book high demand weeks, but ok.

With that being said, Have a blessed holiday season and a wonderful New Year.

I'd never call someone that merely plans according to the limitations in the scheduling of other events in their life a procrastinator. I would also never consider penalizing them for those limitations. I'd just look at it as a situation where the limitations on scheduling the use of mutual owned assets like timeshares might not align well with the other limitations in their lives. That's a situation where it might be more beneficial for me to own a vacation home or fixed week outright and not need to worry about the impact of my limitations on others because any additional flexibility I get is at someone else's cost. That's why I own the fixed week and fixed unit timeshares I do - I value the certainty of knowing I'll be going to those exact units at those times sufficiently to be willing to have paid the costs for those ownerships. On the other hand, the floating week and point systems I own are for using as efficiently as possible to get additional trips when they are available - in my view, floating and point systems are not designed to get me or anyone else high demand weeks in an efficient manner. I do appreciate that in some systems, like Abound, those weeks cost more in order to reflect the demand, but even so don't really believe it's worth the effort to try and get them through those systems. I have been lucky on a number of occasions because I've been willing to be persistent, but for the most part would rather use such systems efficiently.

Best off if we all view this as the Airing of Grievances, I guess. Happy Festivus!

 

[Fasttr]

Happy Festivus!

 

[jp10558]

You're absolutely correct--which underscores my point that selling "flexible" floating or points systems has just been to disguise the underlying product. Timeshares were never designed to be used the way they've been selling them.

Were timeshares ever like how they are sold? I do think my one sales experience with HGVC in DC didn't mis-sell how the points system works. The person was very clear that I'd have an advantage in booking if I could go during "shoulder seasons", and especially if I can avoid peak "schools out" times. And that those reservations would cost less (and they do). What they weren't clear about was the number of points needed or what sort of accommodations the points could get, but OTOH I was basically (mistakenly myself) saying I only really needed something more comparable to a hotel room, hence studios. I was also strongly suggesting at the time I couldn't travel anywhere near as much as I've been able to (didn't know how receptive work would be to working from timeshares). So while the developer price was still stupid and I'm glad I passed, the guy might not really have been wrong with an EOY ~4000 points targeting a studio every other year.

Anyway - maybe he was a better salesman in that he didn't mislead me on competition to book and when it's high. I guess maybe Marriott is much worse on this, but as long as I'm booking out I'm not really having too much trouble, though again I don't have hard and fast *this location* at *this time*. But HGVC and Wyndham were easy to say somewhere in Vegas 2BR sometime in September 2024.

I.e. the flexibility seems to be working and I don't really feel like anything was "hid" in the points systems, except for what a lot of this post has been about WRT needing to plan and do it in advance. But it's not much different to me than getting plane tickets either - trying to do those last minute is real expensive too.

There was already a "points" system for flexible travel to destinations around the world, and it's called "cash."

True, but it's also common for there to be paid or free loyalty programs that can save you money over cash. My local car wash for instance charges ~$20 a "works wash", but if you pre-buy 30, it's more like $14 a works wash. If you commit to paying $40 a month, you get 1 wash every day if you want. Lots of places want to encourage you to keep going to their business, and will give a discount if you do - but maybe this is again back to perhaps a better way to think about / sell timeshares.

 

[Dean]

Calling those who cannot plan a year out “procrastinators” is a bit off and elitist, I am not looking to penalize anyone unlike those of you who like to see the owners who cannot plan a year out “penalized”. Not sure how it’s selfish to want to see ALL owners (the early planners and those who can’t plan early) with equal opportunities to book high demand weeks, but ok.

With that being said, Have a blessed holiday season and a wonderful New Year.

I've asked before but I haven't seen any suggested solution that would work for your stated issue, that of those who chose to plan last minute. As I stated before, there are other time frames that could be chose but anything less than that of the airlines is likely not a workable core approach. What is your suggestion of how to do this AND service the masses? The only approach I can see that would do so would include more supply than sold availability and thus a higher cost. I'll state unequivocally that simply having multiple release dates that end at 4 months out will not help this problem at all.

The current situation is based on the past situation of having more unsold timeshare weeks to allocate. This led to there being better "selection" of weeks to book. This is no longer the case,as those weeks are now in the DC trust, and as many points as possible are being sold against them. Those points are being sold as "prime" points, but not backed by the amount and level of stays being "sold". (Buy the points and go to Hawaii - but there aren't enough Hawaii weeks available to match the demand.) Marriott timeshares doesn't care, as long as they make the sale. Then if only a "mud week" is available, it's not Marriott's fault. They promised a week, and delivered a week. They didn't guarantee a prime week. . .

This is the nature of ALL points systems though it is magnified at Marriott, esp at legacy resorts where there significant differences in demand that also have different seasons and as you point out, differing available units. In truth, points owners have an advantage over weeks owners who are trying to reserve at 12 or 13 months out in many cases. Those with the best chances of suggest are those with volume stringing multiple weeks together at 13 months out but points owners are often in the next best situation to secure that desired reservation because MVC opens up all remaining units for points reservations.

 

[ljmiii]

Calling those who cannot plan a year out “procrastinators” is a bit off and elitist,..

Perhaps a bit off…but the very opposite of elitist. The whole point of buying a timeshare is to allow you to stay in accommodations at a reduced price. To enjoy travel experiences you might otherwise not be able to afford.

The ‘catch’ for that reduced price is that it requires prepayment and preplanning. Complaining that your timeshare often doesn’t allow for last minute booking is like complaining that your Amtrak rail pass won’t take you to Hawaii. Yes, it’s a travel product…but it’s just not designed to do what you want.

With that being said, Have a blessed holiday season and a wonderful New Year.

Indeed…Happy Holidays and a Happy New Year to all!