Moving forward, how do you anticipate the changes to impact your business as well as DVC as a whole?

Image: Disney

Paul Little: I see a 2-3% increase in sales. Many new DVC members are previous renters. Renting DVC points is the best way to test the waters without committing to a large financial outlay. This change allows us to keep a portion of those guests as return renters while also gaining new clients that had not rented before.

Kinn Tutas: Going to Disney is an experience many families cherish and remember their entire lives. I’m finding second generation purchasers now popping in to purchase DVC because they want their children to have the same magical childhood they remember. Staying in a DVC resort as a DVC owner is “the only way to go to Disney” regardless of discounts not being offered through incidentals. Disney and DVC are very resilient, and this is already becoming something in the past.

Scott Ferraioli: Disney always has the right to remove any perks from Resale or Direct members.  As long as you know that going in, the large savings on the Resale Market outweighs anything Disney has taken away.  The main point of Disney Vacation Club is to pre-pay for your Disney vacations, and that is where the real savings will be.  While perks are nice, locking in your family's vacations for years at a discounted rate is the real reason to purchase a Disney Vacation Club membership. 

Nick Cotton: I do not anticipate a lot of changes to our business. I think this additional restriction has caused a very slight decrease on prices as sellers understand they are conveying one less thing, but the loss of the incidental benefits for the most part is quite insignificant compared to the savings of resale.

I do think Members should all understand that when restrictions happen we are all in this together.  For example, whether you bought direct, resale prior to 4/4/16 or resale after 4/4/16, if and when the day comes that you want to sell your contract, everyone’s resale value will be susceptible to the same resale restrictions.

Additionally, DVC may have a few more Members adding on 25 points from those new Members who are buying resale for the savings, but also really want the “incidental benefits.” It is important to note that many of the “incidental benefits” can also be received by having a Disney Visa Card.

Do you believe Disney behaved appropriately with these changes? And do you have any concerns that they'll add even stronger restrictions in the future?

Image: Disney

Paul Little: Obviously, Disney sees the resale market as being a hindrance or threat to the program as a whole. I see it in a different light. The resale market, along with the ability to rent DVC points, only strengthens the perceived value of the product in a potential buyer's mind. DVC is the leader in the timeshare industry and can demand higher pricing because of the value of the product.

Did they behave appropriately? My answer would be that it is well within their rights. Will it have the effect that they are looking for? I see this is a small and diminishing blip on how it will affect the resale market both from the potential buyer’s perspective and Disney's goals to stem resale purchases.

I don't think that there is too much more that Disney can take away as far as member benefits. Their next move, should they decide to take one, would have to be something more grand. First, because there a few small tweaks to be made, but secondly, and more important, because only a large change would make a difference. If I were consulting Disney, I would suggest that they be very careful before making any grand institutional changes. These types of modifications have the potential to harm the brand itself instead of accomplishing their short term goals.

Image: Disney

Nick Cotton: I believe Disney certainly had a right to remove the “incidental benefits,” as they are defined as something that can go away at any time. DVC’s message regarding the change was that their intention was to provide more of a premium benefit to those Members joining directly.  Given the price gap that can exist with direct and resale, you can understand part of their motivation. 

I don’t really have any concerns about future restrictions, as every restriction that has taken place was something that was clearly defined as “incidental” and “removable.”  Keep in mind that if Disney was to restrict something that was a core part of the Membership (assuming they legally could), and this restriction significantly adversely affected resale value, that change would make it much harder for them to continue to sell direct as well.  It would be like a car manufacturer selling new cars, and having the customers agreeing to let the car manufacturer remove the engine when the customers went to resell the cars.  This would likely make it impossible for that car manufacturer to continue to sell.  

Also, removing incidental benefits is not just found with buying resale.  Over the years, many things have come and gone regardless of whether someone purchased direct or resale.  For example, there was a time when valet parking was complimentary to all DVC Members, and now it is not complimentary for any Members.  There was also an 18 month block for all DVC Members booking Disney cruises in 2011 and 2012 with the launches of the Dream and Fantasy ships.  I think it is important that regardless of how anyone purchases DVC, they need to make sure they are purchasing for the right reasons, and not for something that is incidental to the Membership.

Kinn Tutas: Although I understand DVC's dissemination of the news was very confusing to customers due to the conflicting information being given, I do feel they acted appropriately with the decision to make the changes. As the gap between resale and developer pricing continues to widen, DVC has to have an incentive for buyers to purchase at the higher rates. I do not feel there are any additional restrictions to put into place. The ability to use the DVC resorts with the seven and 11 month booking windows as well as the option to exchange into RCI are the mainstay of the ownerships. The only features left to remove would be the little used Club Cordial and Club Intrawest.

Scott Ferraioli: I believe that Disney really can't remove too many additional benefits, and the only way they can try to compete with the Resale Market would be to make additional offerings to Direct purchasers (like the addition of the EPCOT Lounge and the DVC Member Parties).  I don't personally believe that they can offer enough to make buying direct a feasible option in many people's minds, but we're looking forward to seeing if Disney has any additional perks for the grandfathered in members.  Disney's a fantastic company and knows what they're doing, so we'll just see what the future brings.