Originally Posted by pinniped

I give the hotels credit for one thing though: they've generally been pursuing a course that, while unfortunately decreasing differentiation and character in the race to cut costs, has generally yielded greater total value for most end users over time. That is, the hotel quality that one real dollar buys me in 2011 is actually pretty good compared to the past 20 years or so (my traveling lifetime). Example: $152 gets you a night at the Renaissance 57 in NYC in January 2012...just a normal rate with normal cancel rules on Marriott.com. I don't think I've ever stayed in a quality Manhattan hotel for $152 - even in nominal terms back through the 1990s!!

I've seen the same pattern in many cities: the hotels are competing hard, offering better promotions than ever and more paths to status than ever, driving down the net cost per unit of lodging, almost no matter how you choose to interpret/measure quality. For their stockholders, it may not be good...I don't trade them directly.

Airlines, on the other hand, I give little credit. If they're destroying loyalty, they're doing through their crappy product. Their main weapon to try to retain loyalty is to simply treat the no-status and low-status members worse and worse, thus creating very high switching costs - at least for people who don't know about or don't have any way to get a status match to another carrier. Unlike the hotels, I'm getting less value per air travel dollar spent.