DownUnderFlyer

LTP. So I think I am there. Maybe. Kind of.

damon88

Johnny Rocket

Has anyone successfully ordered a replacement METAL card?

Each time I ask, I just keep getting a plastic one sent to me!

BTA

No, I'm still waiting for my original metal card. Coming up on 12 weeks, so I guess I can actually ask for assistance soon? Maybe they are still mining the metal, not sure why else it could take so long.

schley

Why? In finance the time value of money gives the edge to the guest who put his 500 room nights years ago where they can use that profit to bring in a return on it. The active platinum is cash flow now, but they don't have any interest accruing on the profit from years ago.

The benefits you are giving them have a value, late checkout, breakfast, however suites are as available so opportunity cost there.

damon88

I have wondered about this as well. Even though I have attained LTP I will remain active for years (knock on wood) as we have actually accelerated our travel. And while SNAs last we have an incentive to make sure we hit at least 50 nights each year.

But I have thought about what will happen in my dotage when our travel slows down and we travel less frequently.

I have a feeling that Lifetime Status is irrelevant to hotels but who knows how it's weighted in Starwood algorithms. Probably not much (other than your total nights/stay/spend statistics will be high by definition ) since I suspect that recent behavior is weighted higher. (pure speculation on my part but I noticed a difference as I upped our stays from 50 a year to 80+)

Has anyone ever published the number of Lifetime Platinums?

Oxon Flyer

In purely finance terms, profit from years ago doesn't really account to anything. SPG could, and should, do a lot more to keep it's Lifetimers engaged, energised, and most importantly continuing to contribute as much of their cash as possible to the business now.
Instead, Lifetimers seem to be punted off into a commercial backwater, and pointedly excluded from most of the very targeted promos that would be so good at bringing in incremental revenue.

Oxon Flyer

SPG metal cards are like Olympic medals. You don't just request a new one if you lose it ....

schley

Oxon not to insult you but do you understand the concept of “time value of money”? It means that a dollar today can be invested and get a return of say 5% per year to make it simple. So next year I have $1.05 in a years time. That is why a dollar today is more valuable to future earnings. You compound that $1.05 over years of compounding and this is generally accepted as the the power of compounding interest.

If you have future cash flows you actually DISCOUNT their value back to their net present value (NPV), because inflation eats away at that 1 dollar made in the future. It’s buying power isn’t as strong as today’s.

Thus, it is a fundamental in finance that a dollar today is more valuable than a dollar next year.

So applied to our example makes perfect sense that previous spend collected from a business should be more valuable to a business than a dollar today. It doesn’t dimish or dismiss the fact that they need revenue today to stay in business. Keep in mind that the ONLY time you can actually use your lifetime benefits is if you spend your points (liability on the balance sheet), or cash. So I can be a lifetime platinum but I don’t get any value unless I stay at an SPG hotel. The value I get in benefits (breakfast, late checkout, internet) has a small value to me, in return I give you my points/revenue.

Pretty simple.

3544quebec

While the value of the money a LTP gave them years ago might be significant that doesn't mean that the value of the LTP to SPG is. The person giving dollars today to SPG has far more value than the one who was valuable yesterday.

Having an LTP program that rewards previous loyalty is only worthwhile to SPG if it believes that such a program will be aspirational to current cash spenders. We'll look after our LTPs not because they are valuable to us but because others will then aspire to be an LTP

fdem

UA-NYC

Sorry but this is is the opposite of how the world works...past performance may have been nice and gotten you / a company to this point, but the whole stock market (and a company's future prospects) is based on your ability to keep growing & the value is measured by discounting those cash flows to the current moment (NPV). There are plenty of big companies with lots of revenue but low growth, and those are the ones that get sold off & carved up for parts.

All those LTPs may have been great customers at one point, doesn't mean they will continue to be, esp. if they are burning points vs. spending cash, collecting benefits at "better" properties even if they may not have been doing that along the way at the same properties, etc.

OT but that is why I think it is incredibly stupid of UA to offer LT GS...that's giving an insane set of benefits based on annual spend, but letting one qualify it LT-wise by based on mileage transactions (NOT spend).

A perfect summation

schley

Sorry if you guys don't understand, but both sets of people still have to pay for hotel stays, thus represent cash flow NOW! The question was which would you rather have and it is obvious one gave you cash previously that you have a delta of cost v. revenue for your profit, invested gives you a return to use (either capex, operations, or retained earnings). The other gave you jack squat in the past, but will now give you the same cash flow as the LTP.

I never hinted nor implied the LTP isn't staying at SPG properties, much to the contrary they have the motivation to stay as they have benefits (and they have given you thousands of dollars in the past). That inquiry is down and dusted....... and please give me the lifetime plats for who said they are retired or dead?

But you want to move on to future performance which is VERY different question..... let's have a go...... shall we?

Past performance (income statement) and present value (balance sheet) will give you future a hypothesis of future performance relative to the competitive landscape. What is your ROA, return on assets which measures efficiency of how much profit you can generate from your assets. Regardless of how you are capitalized (take out interest on debt) this will be a measure for operations. If i'm investing in you, you need to know this number, which varies by industry. 5 or higher generally.

ROE is what kind of return I'm giving to my shareholders with their investment. Many love this number as well they should. Definitely positive and 20% or higher (depending on the year and industry) is a go here.

All this other talk about I want someone who ISN'T a LTP over someone who IS a LTP because XYZ...... guys you are missing the the formulas that matter and is white noise.

Give me a consistent customer and if I have a good operation with ROE/ROA I will have a good return.

3544quebec

You can have all my customers who have already given me all their money in exchange for all your customers who are currently giving you their money anyday of the week

Someone who gave me good cashflow for a while a few years ago ,I'll send a card to on their birthday. Someone who is spending money today and tomorrow - they'll get a bottle of champagne. No amount of accounting babble outweighs common sense

damon88

Interesting. On most or our reward stays we use SNAs so I can't really use them as a basis of comparison (We have had an amazing success rate with SNAs) And my hunch is that the Starwood algorithm counts total stays/nights/spend/points (in addition to other factors) so that gives an automatic edge to LTP by definition. We too are almost always upgraded at Starwood hotels.

As you say. With Marriott who knows? But I want to believe them when they say they value SPG loyalists and that they want to learn from Starwood. (from my few Marriott experiences they have much to learn So far they have made positive moves. A few major decisions are still up in the air though.