December DVC Sales Tumble

[DanCali]

Far and away, most direct buyers are uninformed. They’re hearing the pitch and either liking or disliking what they see of Riviera. There IS some value in being able to say “the only way you can use your points for all DVC resorts is to buy direct from me.” If you think there are a lot of potential direct buyers specifically avoiding Riviera because they see what resale prices are, I’ll just agree to disagree.

I'm not specifically avoiding Riviera direct because of what resale prices are. But I am specifically avoiding Riviera direct because of what I think resale prices will be...

Of course DVC will make the statement “the only way you can use your points for all DVC resorts is to buy direct from me” - that's why they have the resale restrictions. And I agree that many direct buyers are uninformed. But there will always be a group of informed buyers, which may be pretty large, who love the product and the resort but has no desire to lose 30% of their "investment" on day 1. And that aspect will exacerbate if Riviera resale prices continue to drop as supply increases over the years, and that paper capital loss may be 50%, or worse.

Anecdotally, last summer’s grand floridian incentives were good enough to turn more informed consumers into direct buyers. I suspect the same thing would quickly happen with Riviera and other resorts if similar prices were offered.

The direct prices of VGF and Riviera WERE similar in the summer (within 2%-3%). And VGF outsold RIV by 2:1 and even 3:1. Similar room configurations, similar points charts, similar luxury level, similar expiration dates.... so I think resale restrictions are the main difference. One can always still attribute that disparity to the location, skyliner interruptions, lack of monorail at Riviera, etc. But then you'd think that once VGF was sold out, and without Poly2 or anything else, and there will be no competition and RIV sales with pricing in the $170s (after MB) would see a significant bump, perhaps even skyrocket to over 100,000 points per month. They didn't even get close...

VGF sales with informed buyers skyrocketed because it was direct pricing at resale prices. They'd have to drop prices by another $50/point to make that equivalency for Riviera.

 

[TinkAgainU]

People shouldn't kid themselves that the lounge is DVC being nice and benefit-oriented to members. It's there to sell points, and it won't shock me to see them go more and more overt about that.

They're not spending that money out of kindness to anyone but themselves.

I found the lounge soooo underwhelming. It felt like somebody noticed an empty room and said, we should put some cheap furniture and a coffee machine in here and use it for a cast rest area, since nobody is going to walk up here to buy food or souvenirs ... then someone said "let's see if the DVC people will think it's a perk for Direct?"

 

[AstroBlasters]

This is quite offensive. Who are you to judge.

I don’t think it was “judging”, I think the PP was talking about buying from a pure economical value perspective.

 

[NorCalFanatic]

The DVC lounge at DL is great. I’m sure they looked at an unused space and said “let’s do it” but whatever. It’s a cool spot with a nice 60s vibe and some interesting artifacts. I can get an espresso drink for free, refill our snacks for the kids and top off our drinks with ice and soda. Also a place to take a break from the hustle and bustle of the park to take out food in a nice AC space. Gave us a nice spot to charge our phones, the kids to do their inhaler treatments and use one of the better restrooms in the park. The giant wall mural is from Disney’s 1955 Man in Space series as is the space station model in the corner near the restrooms.

 

[UrsulaWantsYourSoul]

The DVC lounge at DL is great. I’m sure they looked at an unused space and said “let’s do it” but whatever. It’s a cool spot with a nice 60s vibe and some interesting artifacts. I can get ann espresso drink for free, refill our snacks for the kids and top off our drinks with ice and soda. Also a place to take a break from the hustle and bustle of the park to take out food in a nice AC space. Gave us a nice spot to charge our phones, the kids to do their inhaler treatments and use one of the better restrooms in the park.

We also love the huge outdoor space for the DL DVC lounge - taking in the vibe / sights / sounds with somewhere to sit.

 

[AstroBlasters]

We also love the huge outdoor space for the DL DVC lounge - taking in the vibe / sights / sounds with somewhere to sit.

Star View Station is great…. although it is getting significantly more crowded…..

 

[NorCalFanatic]

Star View Station is great…. although it is getting significantly more crowded…..

We noticed that last month is was more crowded than our previous trips. Still we found a table and couch

 

[lowlight]

I know a lot of people find it useful, but if I can’t swing into a lounge for a 10 minute breather and a drink without a reservation, I will never use it. I have literally never gone to the Epcot lounge and been allowed to walk right up. I’d rather have a free popcorn refill than the DVC lounge, but we’ll see how the expansion to a new park goes.

 

[AstroBlasters]

We noticed that last month is was more crowded than our previous trips. Still we found a table and couch

It was pretty annoying when parties of 2 were taking over seating areas designed for 4 when there were areas where a party of 2 would fit just fine.

Their purse and/or backpack didn’t require a chair.

 

[BeachClub2014]

I'm not specifically avoiding Riviera direct because of what resale prices are. But I am specifically avoiding Riviera direct because of what I think resale prices will be...

Of course DVC will make the statement “the only way you can use your points for all DVC resorts is to buy direct from me” - that's why they have the resale restrictions. And I agree that many direct buyers are uninformed. But there will always be a group of informed buyers, which may be pretty large, who love the product and the resort but has no desire to lose 30% of their "investment" on day 1. And that aspect will exacerbate if Riviera resale prices continue to drop as supply increases over the years, and that paper capital loss may be 50%, or worse.

I also think a large group of "informed buyers" (however that's defined) could care less about resale values when they make a direct purchase. Oddly enough, many people just aren't bothered by the current resale value of their points. I will go even further and argue that on any given day, the market value of ANY resale contract is totally irrelevant. If the resale volume of 1% annually, which is often quoted here on the DIS, is true, then the current resale numbers have no impact on the overwhelming majority of people. It only matters if you're in the 1% of sellers or buyers.

 

[KAT4DISNEY]

Riviera outsold Grand Floridian head-to-head for 6 months in 2022 when RIV was priced a few dollars lower. And Riveira also sold at all-time high pace in 2019-2020 before Covid.

I don't know what sort of data DVC has internally about the help or harm of resale restrictions. But there seems to be ample evidence that they don't particularly hurt sales in a 1:1 comparison. The biggest factor that clearly does matter to buyers is price.

I've always pointed out that DVC sells what DVC wants to sell. You can go thru a presentation and hear only about one resort. If you aren't biting then they might bring others in response to why one isn't jumping in. If you're somewhat aware of DVC and inquire about one in particular that's something different but the general sales to people visiting most certainly are directed.

 

[NorCalFanatic]

Do WDW lounges require reservations?

 

[Sandisw]

Do WDW lounges require reservations?

The Epcot lounge is FCFS. The TOTWL is also that way but if there is a paid event, you may not get into the lounge.

I believe that DL is also FCFS.

 

[NorCalFanatic]

The Epcot lounge is FCFS. The TOTWL is also that way but if there is a paid event, you may not get into the lounge.

I believe that DL is also FCFS.

Thanks! Having only gone to DL for the last 40ish years wasn’t sure. Earlier poster mentioned reservations for the lounge and I thought maybe Florida was different than DL which is FCFS.

 

[Sandisw]

Thanks! Having only gone to DL for the last 40ish years wasn’t sure. Earlier poster mentioned reservations for the lounge and I thought maybe Florida was different than DL which is FCFS.

They may have been talking about the paid events then at TOTWL.

 

[NorCalFanatic]

In Aulani all week and have been in the DVC lounge/center everyday for the kids to get their passports stamped. Guides have been fantastic, very friendly and absolutely zero sales pitches or pressure to add on.

 

[_auroraborealis_]

I found the lounge soooo underwhelming. It felt like somebody noticed an empty room and said, we should put some cheap furniture and a coffee machine in here and use it for a cast rest area, since nobody is going to walk up here to buy food or souvenirs ... then someone said "let's see if the DVC people will think it's a perk for Direct?"

That is what happened, though. It is real estate they had no other plan for.

 

[lowlight]

Do WDW lounges require reservations?

They call it a walk up list, I believe. You have to out your name and phone number down to reserve a seat when there is availability.

 

[DanCali]

I also think a large group of "informed buyers" (however that's defined) could care less about resale values when they make a direct purchase. Oddly enough, many people just aren't bothered by the current resale value of their points. I will go even further and argue that on any given day, the market value of ANY resale contract is totally irrelevant. If the resale volume of 1% annually, which is often quoted here on the DIS, is true, then the current resale numbers have no impact on the overwhelming majority of people. It only matters if you're in the 1% of sellers or buyers.

I don't disagree with most of what you said. Many direct buyers who are informed may not care for a variety of reasons. And resale prices may not impact the majority of people on any given day. But they can impact DVD sales, so they matter, especially since DVD annual sales are also in the scale of ~2% of the total market. Here's what I mean:

Based on this (https://*******.com/forum/threads/total-dvc-points-at-each-resort.9877/) there are 70M total points in the system pre BPK, VDH and Riviera, so maybe closer to 85M in total now. Assuming that 1% number you cite is correct, that's about 850,000 points that turn over annually in the resale market. Based on the article in post #1 in this thread, DVD sells about 2M points annually. So those 850,000 resale points that relatively informed buyers do not buy from DVD, can certainly make a difference to DVD in both directions. Changes in that mix can boost or depress their sales materially. Consider a scenario where you may get 1.2M points turning over resale and only 1.6M points in direct sales because those buyers who previously didn't use to care about resale prices now care and opt to go the resale route. Those guides and executives will not be happy with a 20% decline in sales.

 

[BeachClub2014]

I don't disagree with most of what you said. Many direct buyers who are informed may not care for a variety of reasons. And resale prices may not impact the majority of people on any given day. But they can impact DVD sales, so they matter, especially since DVD annual sales are also in the scale of ~2% of the total market. Here's what I mean:

Based on this (https://*******.com/forum/threads/total-dvc-points-at-each-resort.9877/) there are 70M total points in the system pre BPK, VDH and Riviera, so maybe closer to 85M in total now. Assuming that 1% number you cite is correct, that's about 850,000 points that turn over annually in the resale market. Based on the article in post #1 in this thread, DVD sells about 2M points annually. So those 850,000 resale points that relatively informed buyers do not buy from DVD, can certainly make a difference to DVD in both directions. Changes in that mix can boost or depress their sales materially. Consider a scenario where you may get 1.2M points turning over resale and only 1.6M points in direct sales because those buyers who previously didn't use to care about resale prices now care and opt to go the resale route. Those guides and executives will not be happy with a 20% decline in sales.

Perhaps, except as the article also pointed out, In 2023 DVD had their best sales in 12 years so it would appear they aren't too concerned about either resale prices or restrictions.

Edit: I am referring to the underlying article for this thread, and that may not have been clear.