Millions of Marriott Members Abandoning Ship for the Competition?

A new report by Bloomberg indicates that a series of unforced errors by Marriott International may have benefited competitor Hilton Worldwide in a big way. According to industry insiders, Marriott’s recent woes have helped Hilton to gain nearly 14 million new Honors members last year alone, as disgruntled former Starwood Preferred Guest and Marriott Rewards members seek a viable alternative.

Marriott International’s acquisition of Starwood Hotels and Resorts hasn’t exactly gone smoothly. Despite the hotel conglomerate’s best efforts, merging the Marriott Rewards and Starwood Preferred Guest loyalty programs resulted in elite guests from both programs feeling dissatisfied.  Making matters worse, the newly combined rewards program had barely launched before the company was forced to reveal that sensitive personal information—including travel histories, passport details and in some cases, credit card numbers—of more than 500 million guests may have been exposed by a criminal hacking syndicate.

Even “Bonvoy,” the new name chosen for the combined SPG/Marriott loyalty program has been universally panned by reward members.

Now, Bloomberg reports that Marriott’s recent run of poor decision-making and bad luck has become something of a windfall for arch rival Hilton Worldwide. According to Hilton CEO Christopher Nassetta, the Hilton Honors loyalty program gained nearly 14 million new members last year – a substantial boost he attributes to disruptions at competing loyalty programs, which led customers to seek less volatile alternatives.

“I suspect that we are benefiting by getting members of other programs that are shifting their loyalty,” Nassetta told stakeholders during an earnings call this Wednesday.  “I can’t give you hard data on who’s come exactly from where, and, to a degree, as long as they are great customers that we can get engaged with us, we don’t care.”

Marriott Bonvoy members, including both former Marriott Rewards and SPG members, on the Flyertalk forums seem to back up the assertion that disaffected elite travelers are ready to abandon Marriott in the face of lingering IT issues, rewards chart inconsistencies and growing customer service failures. The problems for Marriot is, perhaps, even bigger than the recent boost to Hilton’s ranks would seem to indicate. A number of Flyertalk members who have previously held elite status in both the Bonvoy and the Honors loyalty programs (therefor not counted among Hilton’s 14 million new members), are indicating in posts that Marriott’s seemingly endless missteps over the last year have made Hilton their new first choice for overnight stays.

Is the newly combined Marriott Bonvoy program simply suffering inevitable and understandable growing pains or is it past time for elite guests to jump ship. The debate is evolving here.

[Image: Max Pixel]