The Spirited 8th Wonder (WDW's Future & You!)

[Buried20KLeague]

Exacty. Long term capital investment that will fuel new content for the resort (see Pandora and Disney Springs) and that 5th gate. Thanks for bringing a bit of reasoned sobriety to this thread.

Come on, jt. You know as well as I do that they don't use the money from DVC to fuel content, or upkeep, or expansion. If that were actually the case, you'd see a lot less complaining on this site and a whole heck of a lot more discussion about the excitement of the new projects coming down the pipe.

DVC has become a necessary evil. It's required for them to continue to build and sell because they have to "feed the beast". They've got to show Wall Street the numbers every quarter, and there are very few ways to do that as quickly and with as high margin as DVC. So they add. If they don't, the quarterly report doesn't look nearly as good, the shareholders aren't happy, the stock drops, and it hits those in charge where it hurts... In their pocket.

Don't be naive... The people in charge are not focusing on the long term health of the P&R division... They're focusing on the short term profitability of the division during their tenure in charge. They know they're not there forever, and they're not concerned about what happens when they're gone. They want to do whatever they can to bank as much $$ personally as possible, while they can. You don't do that by spending billions in new attractions, or gates, or virtually anything that you can't show a direct (and fast) ROI on. You do that by wringing more blood out of the turnip. You do it with smoke and mirrors. You spend billions to data mine and increase guest spend without them noticing. You tie them into decades long contracts for hotel rooms they pay for the right to use and get them to pay for your own resort infrastructure and amenities in the form of yearly dues. Cut back on the number of hotel rooms (and therefore expense) at the same time?? Even better.

Over the past decade, the ways WDW has blatantly tried to squeeze more out of every guest are numerous and sickening, IMO. And it's not because I don't like capitalism. I own multiple companies myself. It's sickening to me because they're not giving anything back at the same time. They're not keeping the parks fresh. They're not opening shuttered restaurants and attractions and locations. They're not GIVING anything. They're only TAKING.

A large majority of their guests are sheep... And they know it.

 

[Buried20KLeague]

You left out the dimension of "under my watch". People care less about legacy... And more about stats you can quote "in my last position, in 3yrs I reduce OpEx 8% and improved occupancy rates by 15%"

Where that group will be 5+ years after they leave is less important to them and won't even be part of the discussion for their next role.

It's part if our "disposable economy". No one cares if your legacy folded later...

Dangit. You ninja'd me.

 

[flynnibus]

Great concise description of the situation.

I'd argue that part of the reason (beyond financial which I agree is the main driver) is that this is a company that has clearly lost their confidence in their own abilities, and ultimately has lost their nerve to even try for quality and innovation.

I don't know if they lack confidence... But more about risk adversion and seeing yourself as an aggregator vs a producer. (IMHO) You can scale faster and cheaper as an aggregator of other efforts...

Twdc is a conglomerate now... And that mindshare eventually works it's way down into the mindset of the subsidiaries too

 

[Buried20KLeague]

Great concise description of the situation.

I'd argue that part of the reason (beyond financial which I agree is the main driver) is that this is a company that has clearly lost their confidence in their own abilities, and ultimately has lost their nerve to even try for quality and innovation.

I disagree. We've seen that they still "got it". They can still innovate. Cars Land and Disney Sea are evidence of that.

The problem is that at WDW they don't feel that they NEED to. And I would say proof of that is knowing that down the street UNI is doing amazing things... All things that WDW leadership had details of years ago... And completely didn't react.

They just didn't NEED to. And they knew it.

 

[Quinnmac000]

I disagree. We've seen that they still "got it". They can still innovate. Cars Land and Disney Sea are evidence of that.

The problem is that at WDW they don't feel that they NEED to. And I would say proof of that is knowing that down the street UNI is doing amazing things... All things that WDW leadership had details of years ago... And completely didn't react.

They just didn't NEED to. And they knew it.

Disney Seas is co-owned so its not like Disney Corp is paying for all of it which is probably why its so amazing. Cars Land is definitely a step-up.

 

[orky8]

Anyone who has studied economics will recognize this as classic monopolistic behavior. In normal competition, companies are price takers based on supply and demand. They cannot influence supply because if they scale back, a competitor will fill the gap. A monopoly, however, can alter supply to obtain their optimal price for profit purposes. We could debate whether this is indeed the optimal price, but suffice it to say that Disney believes it is and I'm sure they have the spreadsheets to back their logic.

What I find most interesting is that Disney believes it is a monopoly, or at least is acting like one. Go get 'em Uni.

 

[Buried20KLeague]

Disney Seas is co-owned so its not like Disney Corp is paying for all of it which is probably why its so amazing. Cars Land is definitely a step-up.

Sure, but my point is when they're given the resources, they can produce an amazing product. They can still innovate and make even the saltiest Disney Parks Veteran's jaw drop. I'm proof of that, for sure. They're still capable of it.

 

[Chippy]

It seems to me that the current lower occupancy rates at the deluxe resorts may be a direct effect of the DVC business model already cannibalizing the traditional WDW repeat vacationer. I can't say that the conditions at the parks are not contributing to the low occupancy numbers - IASW ride was shockingly shabby last time I rode it- but the shows, fireworks, parades, etc keep us coming back. I am not sure that increasing DVC inventory while decreasing the number of deluxe hotel rooms available will have the desired results; higher overall occupancy rates at WDW. I think you could argue that occupancy rates in standard rooms would be much higher if there were no DVC. It must be that the cost to fill them is more expensive and less bankable. (I have no expertise in this at all so hope I am not embarrassing myself.) My family looks forward to our stays on site and have stayed at deluxe resorts four out of the last five trips (over the last 8 years). However, there is a point of diminishing return where the hassle of advanced booking dining and FP rides coupled with increasing prices, makes the much more affordable off site hotels impossible to ignore. Especially if you have honors rewards at Orlando hotels. The monorail, EMH and even free dining can only go so far to keep you on site. I can not imagine a timeshare ever enticing our family - even though we really enjoy Disney and plan on going back for the foreseeable future. I think I am far more the typical uneducated visitor that never used (or even heard of) a park touring plan (until now) and really can't even decode most of the acronyms used on these boards. Should the DVC make it harder to find a room or afford a descent location they will surely loose my return visits.

 

[Magenta Panther]

Come on, jt. You know as well as I do that they don't use the money from DVC to fuel content, or upkeep, or expansion. If that were actually the case, you'd see a lot less complaining on this site and a whole heck of a lot more discussion about the excitement of the new projects coming down the pipe.

DVC has become a necessary evil. It's required for them to continue to build and sell because they have to "feed the beast". They've got to show Wall Street the numbers every quarter, and there are very few ways to do that as quickly and with as high margin as DVC. So they add. If they don't, the quarterly report doesn't look nearly as good, the shareholders aren't happy, the stock drops, and it hits those in charge where it hurts... In their pocket.

Don't be naive... The people in charge are not focusing on the long term health of the P&R division... They're focusing on the short term profitability of the division during their tenure in charge. They know they're not there forever, and they're not concerned about what happens when they're gone. They want to do whatever they can to bank as much $$ personally as possible, while they can. You don't do that by spending billions in new attractions, or gates, or virtually anything that you can't show a direct (and fast) ROI on. You do that by wringing more blood out of the turnip. You do it with smoke and mirrors. You spend billions to data mine and increase guest spend without them noticing. You tie them into decades long contracts for hotel rooms they pay for the right to use and get them to pay for your own resort infrastructure and amenities in the form of yearly dues. Cut back on the number of hotel rooms (and therefore expense) at the same time?? Even better.

Over the past decade, the ways WDW has blatantly tried to squeeze more out of every guest are numerous and sickening, IMO. And it's not because I don't like capitalism. I own multiple companies myself. It's sickening to me because they're not giving anything back at the same time. They're not keeping the parks fresh. They're not opening shuttered restaurants and attractions and locations. They're not GIVING anything. They're only TAKING.

A large majority of their guests are sheep... And they know it.

I nominate this guy to be the next head of the Walt Disney Company.

 

[Captain Chaos]

Having paid the money to buy in and the annual dues, I pretty much have to keep going to try to recoup my investment. I'm not going to just let the points lapse.

I certainly wouldn't advise anyone else to buy in. Anyone that asks me for Disney advice I tell to stay off property.

Or you can use the points on other Disney DVC properties elsewhere, doesn't have to be WDW...

 

[ChrisFL]

You left out the dimension of "under my watch". People care less about legacy... And more about stats you can quote "in my last position, in 3yrs I reduce OpEx 8% and improved occupancy rates by 15%"

Where that group will be 5+ years after they leave is less important to them and won't even be part of the discussion for their next role.

It's part if our "disposable economy". No one cares if your legacy folded later...

Quoted for emphasis....this is a BIG problem.

 

[Captain Chaos]

I'm with you on this one. After my trip last year I rented out my points this year and will likely do the same next year. If I do go next year it will likely be a quick trip for 1 day of Star Wars Weekend and a visit to Diagon Alley. I am not quite ready to sell yet but probably not all that far off either. I tried to sell to my parents who just added their 4th or 5th contract at the GF a couple of months ago. I still have a hard time understanding why they keep adding points...

Oh I'm not selling either despite being somewhat unhappy and kind of disgruntled... There are other ways I could use my points... Does not have to be in WDW. I, personally, see value in the DVC. I did when i joined, and I still do. I know that isn't popular around here but so what. Value is in the eye of the beholder. I may try to finally get out to Disneyland. Or maybe Vero Beach/Hilton Head. Lots of options. Just not WDW.

 

[Buried20KLeague]

Oh I'm not selling either despite being somewhat unhappy and kind of disgruntled... There are other ways I could use my points... Does not have to be in WDW. I, personally, see value in the DVC. I did when i joined, and I still do. I know that isn't popular around here but so what. Value is in the eye of the beholder. I may try to finally get out to Disneyland. Or maybe Vero Beach/Hilton Head. Lots of options. Just not WDW.

PLEASE... DO go visit Disneyland. And what you REALLY need to do is rent your points for a couple years, and take that money and visit Tokyo Disneyland and Disney Sea. As a Disney Parks fan, it'll change you.

Although fair warning... You may never want to step inside a WDW park again.

 

[JediMasterMatt]

Now why do people here who hate DVCs care? If Disney wants to do this it has no effect on the parks but it does give Disney a source of money that could be used to upgrade and build new attractions and yes even a 5th gate. The cash flow from DVC sales is huge. Especially if they are just converting rooms. The cost should be under $50,000 a room. If the points averaged 100 a week at $160, a point that would take 3 weeks of point to cover the costs and start having a profit. If they can sell 40 more weeks that a $2,000,000 profit per room and a conversion of 300 rooms at WL, BWK, BC, and GF, would result in over 2.4 billion dollars. Now don't tell me it costs Disney anywhere near $600 a week to take care of these rooms a week. That is what the maintenance fees are at $6.00 a point. As everyone also knows timeshare have a much higher occupancy rate and my numbers still leave 9 weeks unsold. They can't sell them all because they need to update at time but you can see huge profits which a good portion of should go to the parks. Then in 2042 it starts all over again. This is long term huge profits and money for the parks which is what we all want. It may not be the business model you like but it is a good business model and DVC care about the parks because the parks drive the sales.

Exacty. Long term capital investment that will fuel new content for the resort (see Pandora and Disney Springs) and that 5th gate. Thanks for bringing a bit of reasoned sobriety to this thread.

Gotta love those that believe their loyalty to the Mouse in Orlando will be rewarded in kind by those that write the checks that expand/enhance/maintain what is going on inside of the gates of the Parks.

If you haven't noticed, your loyalty is what those in control are preying upon. They know you'll come no matter what they do. Now they are trying to cement your "loyalty" by contracts. MM+ is a contract in the form of a reservation made to fill a Disney Resort. FP+ is an strongly encouraged incentive that serves as a contract that at a specific date and time, you will be at a Disney location and not somewhere else in Orlando. And that leads to the ultimate form of a blood oath with the Orlando Mouse, the DVC.

None of these things require any further effort on behalf of WDW to get your money because once you sign up for one of these entitlements, you've guaranteed your money to the Mouse.

Attendance at WDW has continued to rise and has a mutually corrresponding growth in the product on display in the Parks taken place? I think a great many would disagree with that as being true.

Management has learned over the last decade plus that they don't need to do much of anything and they will still get more than their fair share of the Orlando tourist dollar.

The expansion and prolifiration of DVC in lieu of existing rooms at the Resorts speaks directly to the fact that TDO knows that they have more people willing to sign up and sell their vacation souls into the future and when faced with the choice of spending money to bring in a casual guest - it would be better to get more of the guaranteed money that has the contract behind it.

Once you've got a captive audience, you can put whatever you want on display in the Parks.

As Martin implied a few pages ago, the Parks are not what TDO preceives as it's core business. TDO is in the vacation room business. All other concerns are secondary.

If you are a true fan of the Mouse and Disney Parks, use every ounce of your willpower and sleep elsewhere.

The naive get a DVC membership and assume that it is a two way contract. The naive assumes that WDW will continue to a place worthy of committing to. I know if I were to sign up at this point, I would need some terms for my expectations for what WDW can do for me over the course of the term.

 

[danv3]

Come on, jt. You know as well as I do that they don't use the money from DVC to fuel content, or upkeep, or expansion. If that were actually the case, you'd see a lot less complaining on this site and a whole heck of a lot more discussion about the excitement of the new projects coming down the pipe.

DVC has become a necessary evil. It's required for them to continue to build and sell because they have to "feed the beast". They've got to show Wall Street the numbers every quarter, and there are very few ways to do that as quickly and with as high margin as DVC. So they add. If they don't, the quarterly report doesn't look nearly as good, the shareholders aren't happy, the stock drops, and it hits those in charge where it hurts... In their pocket.

Don't be naive... The people in charge are not focusing on the long term health of the P&R division... They're focusing on the short term profitability of the division during their tenure in charge. They know they're not there forever, and they're not concerned about what happens when they're gone. They want to do whatever they can to bank as much $$ personally as possible, while they can. You don't do that by spending billions in new attractions, or gates, or virtually anything that you can't show a direct (and fast) ROI on. You do that by wringing more blood out of the turnip. You do it with smoke and mirrors. You spend billions to data mine and increase guest spend without them noticing. You tie them into decades long contracts for hotel rooms they pay for the right to use and get them to pay for your own resort infrastructure and amenities in the form of yearly dues. Cut back on the number of hotel rooms (and therefore expense) at the same time?? Even better.

Over the past decade, the ways WDW has blatantly tried to squeeze more out of every guest are numerous and sickening, IMO. And it's not because I don't like capitalism. I own multiple companies myself. It's sickening to me because they're not giving anything back at the same time. They're not keeping the parks fresh. They're not opening shuttered restaurants and attractions and locations. They're not GIVING anything. They're only TAKING.

A large majority of their guests are sheep... And they know it.

This post should be required reading for everyone who wants to comment on topics such as those being discussed in this thread. Great work.

 

[GoofGoof]

If your rooms have kitchens in them... What do you think your attach rate is for room service vs a room without a kitchenette? If only a fraction of your rooms use a service vs the economies of scale you gain when every room is the same, you will be less inclined to invest or expand that service. You also gloss over the different customer demographic,etc. the point being when you make a hotel's customer base smaller, you typically hurt the hotel.

Never mind the whole story of a captive audience vs having to compete on the open market.

Dvc robs peter to pay Paul.... And reducing the number of people staying as a nightly resort will stunt its efforts to compete as a world class hotel and resort.

I don't know who actually orders room service anyway at WDW. Probably business travelers who aren't paying for it. Either way it still exists even at DVC.

I'm not sure the demographic is much different. DVC owners are mostly people who stayed at WDW cash resorts before they bought in. Same people in the tourist demographic. Business travelers at a convention will still stay in cash rooms. No change.

I agree with your point that a timeshare resort is not the same thing as a luxury hotel. With DVC though they really are pretty similar (other than the daily housekeeping). In the rest of the world I would agree with your point.

Let's say for arguments sake that room service goes away at WL after this conversion. The advantage of having upgraded pool and common areas is still greater than the loss of room service IMHO. I see it as a win for cash guests with the exception of price and potential availability, and you can always rent DVC points.

 

[omurice]

Thanks for the info, Spirit!
All thoughts regarding the wisdom (or lack thereof) of this concept aside, I'm surprised by the choice of resort. Since WL already has DVC, I'm surprised they didn't start with YC, the one deluxe with no DVC. They must really be enthralled with that whole tepee concept.

I'm not surprised no DVC at Yacht Club yet -- where can you build there? The CM parking and wetlands on other side of the service road is the only open land near to YC, and that is very far from Crescent lake. Or do you mean conversion? Conversion at YC would make sense, so probably someday, they will convert YC rooms to DVC, and maybe some water-facing "preferred" if so, like BW has now (and like BC never got). But so long as they can sell convention blocks, YC might be off the table a long time.


So... What ever happened to the new Epcot-straddling DVC rumor? Pure blue-sky rumor or actual plans that were shelved? This seemed like not a bad idea, if it was well-executed, given the popularity of the Epcot resorts. It's not new, DLP and TDS already have this. Epcot seemed a good fit for this if the theming and location were chosen very carefully.

 

[DonaldDoleWhip]

I don't know who actually orders room service anyway at WDW. Probably business travelers who aren't paying for it. Either way it still exists even at DVC.

I'm not sure the demographic is much different. DVC owners are mostly people who stayed at WDW cash resorts before they bought in. Same people in the tourist demographic. Business travelers at a convention will still stay in cash rooms. No change.

I agree with your point that a timeshare resort is not the same thing as a luxury hotel. With DVC though they really are pretty similar (other than the daily housekeeping). In the rest of the world I would agree with your point.

Let's say for arguments sake that room service goes away at WL after this conversion. The advantage of having upgraded pool and common areas is still greater than the loss of room service IMHO. I see it as a win for cash guests with the exception of price and potential availability, and you can always rent DVC points.

Yep. We've stayed at the deluxe resorts quite often, then we tried CSR, POR, Pop for a night, and finally off-site. Ultimately, we still found enough value from the on-site deluxe resorts to buy in at GF. It was the smallest contract possible (100 points), but it felt right for us after years of WDW vacations and trying the other options.

What can I say - I recognize many of WDW's flaws, but I still love it. And if I ever become completely disgruntled with WDW, it looks like Grand Californian and Aulani have a surprising amount of availability during certain times of year. We aren't regretting this.

 

[merry68]

Come on, jt. You know as well as I do that they don't use the money from DVC to fuel content, or upkeep, or expansion. If that were actually the case, you'd see a lot less complaining on this site and a whole heck of a lot more discussion about the excitement of the new projects coming down the pipe.

DVC has become a necessary evil. It's required for them to continue to build and sell because they have to "feed the beast". They've got to show Wall Street the numbers every quarter, and there are very few ways to do that as quickly and with as high margin as DVC. So they add. If they don't, the quarterly report doesn't look nearly as good, the shareholders aren't happy, the stock drops, and it hits those in charge where it hurts... In their pocket.

Don't be naive... The people in charge are not focusing on the long term health of the P&R division... They're focusing on the short term profitability of the division during their tenure in charge. They know they're not there forever, and they're not concerned about what happens when they're gone. They want to do whatever they can to bank as much $$ personally as possible, while they can. You don't do that by spending billions in new attractions, or gates, or virtually anything that you can't show a direct (and fast) ROI on. You do that by wringing more blood out of the turnip. You do it with smoke and mirrors. You spend billions to data mine and increase guest spend without them noticing. You tie them into decades long contracts for hotel rooms they pay for the right to use and get them to pay for your own resort infrastructure and amenities in the form of yearly dues. Cut back on the number of hotel rooms (and therefore expense) at the same time?? Even better.

Over the past decade, the ways WDW has blatantly tried to squeeze more out of every guest are numerous and sickening, IMO. And it's not because I don't like capitalism. I own multiple companies myself. It's sickening to me because they're not giving anything back at the same time. They're not keeping the parks fresh. They're not opening shuttered restaurants and attractions and locations. They're not GIVING anything. They're only TAKING.

A large majority of their guests are sheep... And they know it.

This states the current situation so well.

 

[acishere]

Ok... that shut me up. Definitely much better. I might actually stay there next year after seeing these!

I've been very anti-CBR for a while because of their cheap looking guest rooms and double beds. These new rooms look great. A total turnaround. I might actually have to start considering to stay here again. I hope the sliding doors get implemented in all the mods. The curtains in PO rooms just don't look as good.