richarddd

They probably believe that all they have to do is be slightly better than their competitors, or at least no worse. Being a lot better may be seen as a waste.

Remember the old joke about two guys in the woods when a bear starts running at them? The punchline is: I don't have to outrun the bear, I just have to outrun you. That's the thinking about competition.

Are you suggesting cost cutting is not enough to turn a profit, that you also need revenue? That's an innovative thought that obviously hasn't occurred to management.

UA-NYC

As far as I'm concerned, the word vomit coming out of this joker's mouth is just noise around the edges

Fabo.sk

talk about owner-centric...

SHLTP

I hope this interview will finally stop the Marriott apologists from calling SPG loyalists like me crazy and deluded for saying SPG was a better program for guests (especially elite ones) than Marriott and that Marriott isn't even trying to achieve SPG's level of guest satisfaction.

The CEO himself admits it!

So stop criticizing me for telling the truth about the programs. Marriott is better for owners (as I've always said) but not for guests, especially those like me that tend to spend at higher end properties.

The vast spread of Marriott doesn't appeal to me. Aside from some JWs, nothing much from the Marriott side appeals to me. I'm sure the spread appeals to many former loyalists who can now use points earned at vanilla properties at ex Starwood superior properties.

So, yes, I have shifted to Hyatt. I have had 2 paid stays at Marriotts in past 2 years. I still have a lot of points left that I'm trying to burn.

I just stayed at a Park Hyatt that was 80% more expensive than the St. Regis in the same city, 60% more than Ritz. I am fairly price inelastic but I care about treatment and service. PH was superior. The F&B manager called other Park Hyatts they know I like, for example, to find out what preferences my family has. They thus ordered Greek yogurt special for me. Wow. That's service.

And when the trip ended up being a disaster because of massive hardware problems on a daily basis (my foot went through the floor, the aircon blew up, the water system failed, the lights turned on every night in the middle of the night waking us up) , the head of the region I'm in actually called me when on I was the airplane heading home and then again 3 days later and emailed me twice and made me whole.

Will I boycott Marriott? Absolutely not. But for SPG loyalists, it was a painful transition especially when Marriott made it seem like they were maintaining SPG standards but it was obvious that it wasn't.

I'm glad the CEO was honest and came out. Now I know I'm not nuts. If Marriott happens to be the best option in a locale, I'll take it with zero expectations.

But if not, I'll take a Hyatt. I am on a 3 week trip right now. It's either Hyatt or whatever fits best and Marriott is not a choice unless it just so happens to be the best option.

Does Marriott care they lost me as a loyal customer? No. Owners prefer Marriott, prices are soaring, and they have that spread for corporate contracts. If I were Marriott, I'd do the same, without pretending life was same w SPG

flyerUSA

I am bored as hell of Marriotts. Lifetime Platinum, zillions of points, zzzzz. I don't think this brand has anything to offer me, in terms of excitement or enjoying a hotel stay. Everywhere I go, all I seem to find are Springhill Suites, other garbage brands, the free breakfast I used to adore is basically all junk food.

I just earned Hyatt Globalist because Marriott turned me off this year with cutbacks. We'll see how that goes. Although Hyatt's cheap stuff like Hyatt Place is equally garbage.

VA1379

The Marriott CEO is assuming that a lot of Marriott customers will not care, but those of us who were Marriott elite before the SPG merger and were used to the Marriott when Bill Marriott ran it are going to have limits as well. He might discover a lot of older Marriott customers leaving as well or at least considering other chains for some of their stays.

SPN Lifer

We've been Bonv�yed!

Dreamwalker

Would a SPG loyalist like to explain what caused SPG to sell ? If loyalty is supposed to increase spend and SPG did the most for it's biggest spenders why did it need to sell? I remember it struggling financially.

I want better perks at Hilton and Marriott. I just gave up my Hilton Aspire and stopped pushing for Platinum elite to remain a free agent for my spend. I use my budget and points at the highest end hotel in the area unless I'm using a FNC or it's a simple trip.

I was really on Hilton's team with the cool perks for cc during pandemic like the resort fee being used for restaurants. My stays at Conrad Chicago and Waldorf Astoria Maldives were top notch. I felt like a Hilton lead the pack with cc and FNC extensions or turning weekend into all nights. The tip more, room service at a request and loss of breakfast was enough I don't care about another coupon card and diamond status.

Now Marriott is saying because we are bigger you should accept what we offer? Why won't someone just be a free agent? Use programs like virtuso or Amex Fine Hotels etc for upgrades on cash paid stays?

Loyalty isn't valued anymore. Look at telecommunications they give discounts to new customers not existing. Any brand that truly values loyalty imo has to take out the short term mindset for long term. These companies worry about share price quarterly if not daily. They can't play the long game imo.

WasKnown

https://www.statista.com/statistics/...s-und-resorts/
https://www.statista.com/statistics/...international/

Starwood was not performing well. At a time when the hospitality industry was booming and Marriott NI grew 14%+, Starwood's NI fell by 29.4%. #facts lol

We are talking about a company that returned $190 million to shareholders in 2013 and $2.4 billion to shareholders in 2014... at a time when the hospitality industry was booming and Starwood was stagnating. It is very apparent that Starwood had no idea how to grow.

Also:

"At a time when competitors Marriott (MAR), Hilton (HLT), and Hyatt (H) were beating analyst expectations and raising guidance, Starwood�s growth has lagged not only industry growth but also investors� expectations.

Starwood managed to add only 7,400 rooms in 2014 and 15,700 rooms in 2015. Its occupancy rate was the lowest among the top four players, and its revenue per available room (or RevPar) was the third from the bottom.

Some analysts believe the reason for this could be the last two CEOs� inexperience in the hotel business."

But truly, the biggest weakness of Starwood was how asset-heavy it was. More than anything that is the reason why they were sold during a hospitality boom.

--

I strongly disagree with anyone that believes loyalty programs are supposed to garner the loyalty of guests. IMO these programs exist to:

1) Get customers to book direct rather than through OTAs
2) Source a consistent stream of customers for their franchisees

Of course Marriott cares about retention... but retention of their franchisees. At the end of the day, Bonvoy only needs to be tolerable enough that people will continue to a ) book direct when staying at a Bonvoy hotel b) consider Bonvoy hotels as credible options to begin with.

I genuinely think the difference between OTAs and asset-lite hotel companies becomes smaller and smaller every day?

Is there a huge difference between Hyatt's relationship with SLH and the Hotels.com relationship with a large hotel operator?

I think the rise of soft flags (that essentially have very limited brand standards) like Luxury Collection and LXR are a slow march toward this.

Dreamwalker

IMO you just said loyalty to guests in a different way. You want my loyalty to use your website and to feed your customer the franchisee. That requires loyalty from me the guest to accomplish that.

I think your just talking around loyalty for guest. Do I believe we are the reason for these programs no, but our spend is needed to fund whatever the reason is. Ie could be your points or could be to keep up with the Jones. Ie Hilton or whomever.


I understand SPG struggled. I wonder why if Hyatt is asset heavy too. To my knowledge it doesn't franchisee out. Did IHG start that trend? I feel like Hilton and Marriott were asset heavy when there namesakes still owned the primarily. I guess the Marriott's still do?? I can't remember.

Adelphos

I�ve met a lot of the CEOs involved here, including Arne, Capuano, Frits van Paaschen, Nassetta, Hoplamazian, etc. Never met Bill Marriott. But in terms of CEOs, industry people universally said Arne is the best in terms of vision and industry relations, followed closely by Nassetta. Frits van Paaschen was disliked in the industry and by shareholders. You can talk about high spending elites all you want but Starwood lagged Marriott and Hilton in delivering paying guests to US hotels. Hoplamazian seems fine but the Pritzkers run Hyatt.

I thought Stephanie Linnartz should have been elevated to CEO over Capuano (I said so in this forum after Arne�s death), she would have been unlikely to say something like this in an interview no matter how true it is. Nevertheless Capuano is a serious developer and will make owners happy and grow the company.

Dreamwalker

Paying guests are important.

WasKnown

I�m really glad to read this. I have listened to pretty much every Arne Sorenson interview on YouTube. Somehow his talks have become my go-to workout noise whenever I don�t feel like listening to audiobooks. He was my favorite out of all the big hotel executives (though I know he gets a lot of hate on this board). RIP.

But if we are being fair, Arne Sorenson basically said this exact thing (scale over benefits for loyalty) many times as the SPG merger happened. From the start, he always talked about leveraging scale and using a diversity of options to be the ultimate value proposition for guests. Perhaps he said it in a less inflammatory way but� IMO the intention was the same. I think Bonvoy would continue to have gotten worse, even with Arne.

IMO the fact that Starwood�s model clearly did not work is all the validation needed for Marriott to continue to gut SPG. Why pay for these benefits if they�re not actually attracting guests in tangible numbers?

You don�t need to be loyal to Marriott. You need to a) book with Marriott directly and b) consider Marriott as a credible option when choosing hotels. I don�t think Marriott thinks it�s worth being the indisputable best option for people like us. People fundamentally misunderstand loyalty programs.

Also, I really don�t understand where you�re coming from with the Hyatt asset heavy comment lol. Hyatt owns more hotels than many of its competitors but it�s been pretty clear they have shifted their focus away from O&L to F&M.

The entire industry (including Hyatt) shifted to asset light. Starwood sold itself because it couldn�t shed its assets quickly enough. Hyatt didn�t because it could.

https://skift.com/2019/03/06/hyatt-d...hter-approach/

Dreamwalker

My understanding was that Marriott and Hilton were asset light and loyalty programs light, because their customers were franchise and they have a large footprint. IE light assets, because they don't really own the properties. I thought Hyatt still own their properties and didn't franchise, so they needed a stronger loyalty program because of this and there smaller footprint. I did not realize they sold a lot of their properties too.

I don't understand your point of view with the A) book with Marriott Directly and b) consider Marriott as a credible option. If I am booking with them directly I am showing loyalty, if I find them a credible source, I am showing them loyalty. What is you definition of loyalty booking with another hotel?

WasKnown

Hyatt franchises a ton of their hotels, just like Marriott and Hilton. As of 2018, Hyatt only owned/leased 40 hotels. Considering that�s an article dedicated to describing how Hyatt is mass dumping its properties moving into 2020 and 2022, it�s safe to assume that number is even lower than 40 today.

Ultimately, the fact that SPG didn�t succeed is all the evidence Marriott needs to take a different path with loyalty. Starwood failed to grow (and even shrunk) during a time when the other hotel chains were expediting rapid growth. Even as weak as we view it, Bonvoy loses money. I just don�t think guests-oriented programs make sense for large chains. People that really want a SPG experience are better off just staying in the Hyatt bubble.

Personally, I think the Marriott philosophy of portfolio diversity works for the reasons I outlined above.