Select Member Exclusive Email offer [Targeted], 30 April 2015
#167
Join Date: Aug 2011
Location: CDG
Programs: SK Gold, AF Gold, Marriott Platinum
Posts: 3,683
This whole situation mimics a very typical FMCG scenario - when you run a promo too often, customers get used to it and the promo price becomes the benchmark. Competitors follow, creating a price war that runs margins into the ground. Then at some point, one of the players says "enough" and cuts on promos drastically. Sooner or later, despite growing market share, others follow in order to (re)create healthier margins for themselves.
Now, I'm not saying that the two industries are entirely comparable, but when I look at my own example, with the year-round promos, I amass enough points to make every 4th or 5th night a free one, easily losing Starwood 20-25% of revenue they would otherwise have had from me, and I'm only a lowly Gold - I can only imagine what the percentage is for heavy corporate travellers. Are such percentages workable for the hotel industry? I won't pretend to know the answer, but I can see why a healthier global economy that we're currently enjoying would disincentivise promos. After all, the original idea behind hotel loyalty programmes was to offer systemwide preferential treatment (such as priority check-in and late checkout) - not free nights.
Anyway, since promo-sensitive customers are so eager to jump ship as soon as the carrot is gone, the problem can be fixed by simply restarting good promos if revenue drops too much
Now, I'm not saying that the two industries are entirely comparable, but when I look at my own example, with the year-round promos, I amass enough points to make every 4th or 5th night a free one, easily losing Starwood 20-25% of revenue they would otherwise have had from me, and I'm only a lowly Gold - I can only imagine what the percentage is for heavy corporate travellers. Are such percentages workable for the hotel industry? I won't pretend to know the answer, but I can see why a healthier global economy that we're currently enjoying would disincentivise promos. After all, the original idea behind hotel loyalty programmes was to offer systemwide preferential treatment (such as priority check-in and late checkout) - not free nights.
Anyway, since promo-sensitive customers are so eager to jump ship as soon as the carrot is gone, the problem can be fixed by simply restarting good promos if revenue drops too much
#168
FlyerTalk Evangelist
Join Date: Jun 2007
Location: Toronto
Programs: UA 1K, AC MM E75, Marriott LT Ti, IHG Da Amb, Hyatt Glob
Posts: 15,472
Start hyperventilating because I've been targeted again, with the same offer as last November. At that time I was, and had requalified for, Plat50. While it seemed odd that SPG felt a need to entice me to stay more, I hadn't stayed at SPG and had no bookings in the month between requalifying and when the offer was sent.
This year I'm way off pace to requalify as Plat50 due to SPG not being where I went so I could see their computers flagging me as someone needing a nudge. However, that's probably giving them too much credit; this appears too random and/or too broad to be more than an experiment as to what types of promos yield the most incremental business for which types of customers, rather than a bonus to "special" customers.
I got the same offer as you back in Nov. During that promo I had a 1 night, two room stay and the two stay credits counted for the bonus points, as I expected. I expect the same will be true this time.
This year I'm way off pace to requalify as Plat50 due to SPG not being where I went so I could see their computers flagging me as someone needing a nudge. However, that's probably giving them too much credit; this appears too random and/or too broad to be more than an experiment as to what types of promos yield the most incremental business for which types of customers, rather than a bonus to "special" customers.
I got the same offer as you back in Nov. During that promo I had a 1 night, two room stay and the two stay credits counted for the bonus points, as I expected. I expect the same will be true this time.
William, guess you shouldn't be surprised at how unfair this seems. Are some of SPG's customers more Preferred than others? I know if I ask you to comment on this, you'll say you have no idea what the marketing team is doing.
Can you at least tell us that as SPG's social media representative that you are provifing feedback from the FT community to your mktg dept. Seriously, targeting the same people twice while totally ignoring others??? I would love to be a fly on the wall in SPG's marketing war room. What are they thinking?
#169
Company Representative - Starwood
Join Date: Nov 2000
Location: Austin, Texas
Programs: Marriott Employee Level
Posts: 31,593
Best regards,
William R. Sanders
Social Media Specialist
Starwood Hotels & Resorts Worldwide
[email protected]
#170
A FlyerTalk Posting Legend
Join Date: Sep 2009
Location: Minneapolis: DL DM charter 2.3MM
Programs: A3*Gold, SPG Plat, HyattDiamond, MarriottPP, LHW exAccess, ICI, Raffles Amb, NW PE MM, TWA Gold MM
Posts: 100,334
The Majestic is a much better location, but of course it's a very different style.
#171
A FlyerTalk Posting Legend
Join Date: Sep 2009
Location: Minneapolis: DL DM charter 2.3MM
Programs: A3*Gold, SPG Plat, HyattDiamond, MarriottPP, LHW exAccess, ICI, Raffles Amb, NW PE MM, TWA Gold MM
Posts: 100,334
#172
Join Date: Feb 2003
Location: San Rafael, CA
Programs: Life SPG Plat, 7X NH DIA
Posts: 2,840
Just another Datapoint
8 year Plat, 13 stays booked in the qualifying period. No Offer
8 year Plat, 13 stays booked in the qualifying period. No Offer
#173
Join Date: Jul 2011
Programs: UA 1K, SPG Platinum, Hyatt Diamond, Hilton Platinum, Marriott Platinum
Posts: 568
Select Member Exclusive Email offer [Targeted], 30 April 2015
I must admit the promo has incentivized me. I've booked more nights in SPG v other over the coming month.
#174
A FlyerTalk Posting Legend
Join Date: Sep 2009
Location: Minneapolis: DL DM charter 2.3MM
Programs: A3*Gold, SPG Plat, HyattDiamond, MarriottPP, LHW exAccess, ICI, Raffles Amb, NW PE MM, TWA Gold MM
Posts: 100,334
Sadly I'm not a target here.
#175
Join Date: Jun 2007
Location: JAX
Programs: UA Plat MM, AA Gold MM, Marriott LTT, Hyatt Globalist
Posts: 3,770
As a loyal SPG LTP, I can kiss all targeted promos goodbye.
#176
Join Date: Jul 2013
Posts: 75
I agree. They aren't. These guys are happy to move business because of a few thousand points. Sadly, and the truth hurts, is that there are 10x, 20x, 30x and maybe more the amount of elites out there who don't participate on FT but stay in the same amount of nights each year as these complainers do and continue to stay at SPG properties. Those customers are the best ones - the ones that don't need incentives to stay, because the current benefits match or already exceed their expecation and needs.
More importantly, the customers that complain or make remarks on FT, are likely the same customers that are very vocal with their friends/relatives/co-workers about the airlines they fly and hotels they stay in. A key measure in customer service surveys is how likely you are to be vocal / recommend a certain brand and I'm sure FTers are near the top of that list.
Now, I'm not saying that FT users are a large chunk of their business or are their "best" customers, BUT I do think it is a mistake to alienate some elite customers and not others. From a "valuing your customers" perspective, there's no reason why person A and person B both have X nights this year / last year and have the same status level but they don't receive similar promos. The most logical explanation is that they are excluding some loyal guests who will book stays REGARDLESS of promotions because most of these guests won't even know these targeted promos exists. This, unfortunately, includes some FTers who read up on this and get upset, but that's the cost of business for SPG.
#177
FlyerTalk Evangelist
Join Date: Oct 2011
Location: ATL
Programs: DL Scattered Smothered Covered Medallion, Some hotel & car stuff, Kroger Plus Card
Posts: 10,742
Assume that on the whole, SPG is seeing its properties meet or exceed desired occupancy %s during a very busy time of year. What guest would they rather attract?
SPG Plat who already stays on a corporate rate every week, consumes free internet, free breakfast, lounge amenities, bonus points, free water bottles, MAGC points, etc.
Joe Schmoe who has booked a comparable prepaid rate to save a few bucks, pays for everything he consumes, and takes the $5 F&B credit on the rare occasion he uses MAGC.
Business travelers and elites as a group may provide the most revenue for some hotels, but on a per room-night basis, I'd question whether they are the most profitable.
Targeted promos like this are in the same family as FCM buy-up fares being complained about in the airline forums. When given the choice between customers who consume add-ons for free vs. customers who will either pay for those things or not consume them at all, what would you expect a business to choose?
#178
A FlyerTalk Posting Legend
Join Date: Sep 2009
Location: Minneapolis: DL DM charter 2.3MM
Programs: A3*Gold, SPG Plat, HyattDiamond, MarriottPP, LHW exAccess, ICI, Raffles Amb, NW PE MM, TWA Gold MM
Posts: 100,334
+2
Assume that on the whole, SPG is seeing its properties meet or exceed desired occupancy %s during a very busy time of year. What guest would they rather attract?
SPG Plat who already stays on a corporate rate every week, consumes free internet, free breakfast, lounge amenities, bonus points, free water bottles, MAGC points, etc.
Joe Schmoe who has booked a comparable prepaid rate to save a few bucks, pays for everything he consumes, and takes the $5 F&B credit on the rare occasion he uses MAGC.
Business travelers and elites as a group may provide the most revenue for some hotels, but on a per room-night basis, I'd question whether they are the most profitable.
Targeted promos like this are in the same family as FCM buy-up fares being complained about in the airline forums. When given the choice between customers who consume add-ons for free vs. customers who will either pay for those things or not consume them at all, what would you expect a business to choose?
Assume that on the whole, SPG is seeing its properties meet or exceed desired occupancy %s during a very busy time of year. What guest would they rather attract?
SPG Plat who already stays on a corporate rate every week, consumes free internet, free breakfast, lounge amenities, bonus points, free water bottles, MAGC points, etc.
Joe Schmoe who has booked a comparable prepaid rate to save a few bucks, pays for everything he consumes, and takes the $5 F&B credit on the rare occasion he uses MAGC.
Business travelers and elites as a group may provide the most revenue for some hotels, but on a per room-night basis, I'd question whether they are the most profitable.
Targeted promos like this are in the same family as FCM buy-up fares being complained about in the airline forums. When given the choice between customers who consume add-ons for free vs. customers who will either pay for those things or not consume them at all, what would you expect a business to choose?
For airlines, some of us have been arguing that elites should get discounts on FCM buy ups since elites already get free checked bags, elite lines, sometimes lounge access, etc. versus these amenities otherwise costing kettles more than the fare difference.
#179
FlyerTalk Evangelist
Join Date: Oct 2011
Location: ATL
Programs: DL Scattered Smothered Covered Medallion, Some hotel & car stuff, Kroger Plus Card
Posts: 10,742
Are you assuming that a $5 F&B credit costs the hotel less than 500 points? To me, it's not clear and a lot depends on whether you believe that the $5 credit leads to a $30 bar bill in the hotel versus leaving the property or foregoing drinks.
For airlines, some of us have been arguing that elites should get discounts on FCM buy ups since elites already get free checked bags, elite lines, sometimes lounge access, etc. versus these amenities otherwise costing kettles more than the fare difference.
For airlines, some of us have been arguing that elites should get discounts on FCM buy ups since elites already get free checked bags, elite lines, sometimes lounge access, etc. versus these amenities otherwise costing kettles more than the fare difference.
That FCM argument is ridiculous.
Response from airline: Fine, we'll stack the benefit for elites on FC fares. Now you get 6 free checked bags, all of which you'll continue to not use as you lug an overstuffed rollaboard into the OHB.
If elite benefits can be redeemed for discounts off the actual fare/rate, then shouldn't coach tickets also be discounted $25 every time an elite doesn't check a bag? Or should I receive $15 every time I skip the breakfast buffet? Surely neither of those services actually costs the airline or hotel that much to provide, which is exactly why they are the things that can easily be offered to elites for free while also generating significant profit margins from nonelites.
#180
Moderator: Asiana & Qantas Frequent Flyer
Join Date: Dec 2006
Location: STR/SYD/SMF
Programs: QF SG, LH SEN, OZ D+, HH D, SPG P
Posts: 14,344
As so often, I am a target. Just not for this promo.