Why Starwood sold?
Nov 2, 2018, 9:03 am
#31
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Vince ... you tend to ask interesting questions that are more appropriate for a business school study. If you ask why it was sold, its in the deal documents I posted describing why the board of directors exercised their fiduciary duties after hiring expensive business consultants to advise them. You'll notice that those deal documents are very different than the feelings stated on this board from a small group of frequent travelers.
So when you ask questions about why a merger took place, we can offer our perspective from a travelers basis which might be different that the professional perspective we bring to the table. You're asking questions that might be be a more appropriate topic for an MBA program.
Of course, some of us have identified issues in other threads regarding communication/integration/planning that may well be the topic of an MBA program 5-10 years from now ... but that's a different thread ....
So when you ask questions about why a merger took place, we can offer our perspective from a travelers basis which might be different that the professional perspective we bring to the table. You're asking questions that might be be a more appropriate topic for an MBA program.
Of course, some of us have identified issues in other threads regarding communication/integration/planning that may well be the topic of an MBA program 5-10 years from now ... but that's a different thread ....
I agree with you but... I do believe that people in FT are more wealthy and influential
than other 80% people booking through OTA. And from what I seen here, a lot more people praise and prefer starwood over marriott family hotels.By the 20/80 rules, if most of such Plat and frequent flyers prefer starwood, then Marriott should be the one to failed. We heard so many good things about SPG, how luxury or interesting its brand was, but reality is that this company is probably losing money and to be sold. How ironic and doesn't make sense. I want to know why such a contrast.
Nov 2, 2018, 9:04 am
#32
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I think a lot of us care. We invested a lot of our time and travels with a company that in turn invested a lot of time listening and engaging us. (There are endless threads about these gatherings, events, etc. in the original SPG forum) Obviously the OP's question is one for the dealmakers and BOD of each company, but with what appears to be rocky integration I think this is a fair (if moot since it can't be un-done) question to ask from the customer standpoint.
Nov 2, 2018, 9:10 am
#33
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Because a loyalty program is not a major revenue stream, mostly just a cost center. Marriott and Starwood’s core business is to manage hotels and resorts for real estate developers and investors and licensing their brands and know-how. Apparently, Starwood was not very good at that.
So if I may, made a possible conclusion from your statement, ( just one of the many possible reason)
A: SPG knows how to create fascinating hotel brands and imagine.
B.But not good at managing all the franchiser, so faild at keeping consistency. Also fails at limited service brands.
And Marriott in the opposite side?
Another question comes to my mind is that Hyatt also having the same problem that SPG had, a very limited footprint in the world , mostly only full service hotel outside of North America. But Hyatt survived well, at least for now. So there must be some other thing are wrong with starwood, I 'm dying to know.
Nov 2, 2018, 10:16 am
#34
Join Date: Aug 2018
Posts: 902
So if I may, made a possible conclusion from your statement, ( just one of the many possible reason)
A: SPG knows how to create fascinating hotel brands and imagine.
B.But not good at managing all the franchiser, so faild at keeping consistency. Also fails at limited service brands.
And Marriott in the opposite side?
Another question comes to my mind is that Hyatt also having the same problem that SPG had, a very limited footprint in the world , mostly only full service hotel outside of North America. But Hyatt survived well, at least for now. So there must be some other thing are wrong with starwood, I 'm dying to know.
A: SPG knows how to create fascinating hotel brands and imagine.
B.But not good at managing all the franchiser, so faild at keeping consistency. Also fails at limited service brands.
And Marriott in the opposite side?
Another question comes to my mind is that Hyatt also having the same problem that SPG had, a very limited footprint in the world , mostly only full service hotel outside of North America. But Hyatt survived well, at least for now. So there must be some other thing are wrong with starwood, I 'm dying to know.
Rumour was — though I can’t say if this is true — that Starwood was only turning profits because it was selling all its real estate holdings.
Nov 2, 2018, 2:00 pm
#35
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I'm not sure you'd agree if you're an investor:
Stock prices
Jan 2015:
Hyatt $59.56
Marriott $77.75
Today:
Hyatt $71.59
Marriott $121.09
So Hyatt stock is up 20.2% while Marriott stock is up 55.7%.
Maybe all of that difference is simply because of the value inherent in the Starwood brand that was folded into the merged company. Or maybe it's for all of the reasons mentioned in the deal documents that C17PSGR linked. I suspect it's the latter.
Stock prices
Jan 2015:
Hyatt $59.56
Marriott $77.75
Today:
Hyatt $71.59
Marriott $121.09
So Hyatt stock is up 20.2% while Marriott stock is up 55.7%.
Maybe all of that difference is simply because of the value inherent in the Starwood brand that was folded into the merged company. Or maybe it's for all of the reasons mentioned in the deal documents that C17PSGR linked. I suspect it's the latter.
I agree with you but... I do believe that people in FT are more wealthy and influential than other 80% people booking through OTA. And from what I seen here, a lot more people praise and prefer starwood over marriott family hotels.
By the 20/80 rules, if most of such Plat and frequent flyers prefer starwood, then Marriott should be the one to failed. We heard so many good things about SPG, how luxury or interesting its brand was, but reality is that this company is probably losing money and to be sold. How ironic and doesn't make sense. I want to know why such a contrast.
than other 80% people booking through OTA. And from what I seen here, a lot more people praise and prefer starwood over marriott family hotels.By the 20/80 rules, if most of such Plat and frequent flyers prefer starwood, then Marriott should be the one to failed. We heard so many good things about SPG, how luxury or interesting its brand was, but reality is that this company is probably losing money and to be sold. How ironic and doesn't make sense. I want to know why such a contrast.
If you want to look at it, I suggest you look at the 10Ks for Starwood, Marriott, and other chains and review the discussion of what percentage of their guests are elite members of loyalty programs. If frequent travelers generally (as opposed our population on FT) preferred Starwood, there would be lots of objective data points.
Nov 2, 2018, 2:34 pm
#36
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By the 20/80 rules, if most of such Plat and frequent flyers prefer starwood, then Marriott should be the one to failed. We heard so many good things about SPG, how luxury or interesting its brand was, but reality is that this company is probably losing money and to be sold. How ironic and doesn't make sense. I want to know why such a contrast.
There are no shortage of very large, oligopolistic, highly mediocre companies with poor CS...Marriott is now a great example of one.
Nov 3, 2018, 11:40 am
#38
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The OP's initial question is based on flawed logic. The decision on when to sell the company and to whom is not made by the customer. It is made by the shareholder. Two distinctly different bodies, with different expectations.