St. Regis Washington DC NOT Honoring $30 Rates

Earlier in the week I posted about the St. Regis Washington DC (and some other Starwood properties) offering $30 per night rates for stays next November.

The deal stayed “live” for the better part of a day, through Tuesday.

St-Regis-30-Rate

Anyway, I received the following email from Starwood consumer affairs just now:

Dear Ben Schlappig,

We are writing on behalf of The St. Regis Washington D.C. with regard to your reservation for November 2015.

Please be aware that due to a system error, you were able to confirm an incorrect rate significantly lower than the normal rates for the hotel. We have investigated the problem and concluded that instead of presenting the correct rate for the room type booked; our system published the difference between two rates, resulting in the incorrect, very low rate.

We sincerely apologize for any inconvenience this may cause but we cannot honor your reservation at the incorrect rate. The correct nightly rate ranges from $635.00 to $725.00.

If you would like to keep your reservation, please respond to this email and we will ask the hotel team to follow up with you directly with details on the correct rate. You may also cancel your reservation without penalty.

If we do not hear from you by Wednesday June 4th, we will cancel the reservation. We realize this is disappointing and appreciate your understanding.

Sincerely,
_____________
Consumer Affairs Executive Division

Ultimately I’m not surprised that they’re not honoring the rate. I expected they would at least offer a discounted rate of some sort just to show goodwill. It is interesting that the email is coming from corporate consumer affairs rather than the hotel’s sales office directly. So it’s clear that they checked with Starwood corporate before making a decision here, in which case I have to say they were at least quick with making a decision. Or perhaps this was a corporate issue to begin with, since the mistake seemed to be on their end, based on the number of hotels the low rates were available at.

Did everyone else receive the same email, even for stays booked at other properties?

Comments

  1. Gotta love when a company can get away with “false advertising” and not standing by their published price, even if it’s an error. If you walk into a store, and the price tag says one price and the register says another, they need to give you the tag price since that is what’s advertised.

  2. I just received the same letter from the St Regis Washington DC. I’m going to wait a bit before responding — I’d like to get a sense of the mood of folks and see if there’s any sort of movement to present a united front with a coherent demand.

  3. I tried for a while that day, and was not able to find one of the fab rates, so I am not dealing with what would be (for me) great disappointment. I would be pretty angry that they are not honoring it, but outraged that they are not offering some significant compensation (50% off, SW points, something). I’ve never been super-impressed with Starwood, but this definitely is a mark against their customer relations.

  4. Is it allowed in the US for them not to honour the booking? I agree with the comment about the tag price in a store. Many countries have written it into their statutes….they offered, you accepted (by booking) so a contract was formed. They are one sidedly reneging on the contract.

    Also, if I’m not mistaken you are a frequent stayer and a platinum member ( not to mention possible celebrity status in Frequent Flyer circles). So I am very surprised that they don’t take it on the chin and just give you the win.

    You should at the very least be compensated for them pulling out of the contract formed between you and them.

    I used to purchase phone credit (for a foreign carrier) from a specific website on a monthly basis. It was a lot every month and this went on for several years. One day their website charged me USD 100 instead of the Euro 100 it should have. Three days later, the website changed my account without communicating with me. After I complained they agreed to cancel the transaction. I never used them again. Bad faith. And the monthly profit (not revenue) they lost was more than they would have if they had honoured their mistake.

  5. Do you think they sold more rooms than the 182 room & suites that they state they have on their website?

  6. If you’re reading this Starwood:

    Don’t budge!

    As a 100-150 night platinum, I trust that if I l accidentally left my wallet in one of your bars one night, that you are capable of discerning that I’d made a mistake and that you would see to my wallet’s return. I also trust you wouldn’t demand a finders fee or that I surrender any SPG points to compensate you for my obvious error.

    It seems a shame that Frank B and mbh don’t have a similar moral ethic.

  7. To add insult to injury they just sent a correction to their recent notification:
    “We sincerely apologize for any inconvenience this may cause but we cannot honor your reservation at the incorrect rate. The correct nightly rate ranges from $655 to $2,625.”

  8. FatGary: But you did not put the wallet up for sale at a cheap price by mistake, I think that’s what the difference is. I personally didn’t sign up for this fare and although I’m sympathetic for these types of mistakes, I think if the transaction has been made the hotel should honor it.

  9. @FatGary: do I hold a multi-national corporation to a much, much higher standard than a customer in a hotel bar? Hell, yeah. They should have proofing and triple-proofing before they post any offer. That’s basic business 101. You are responsible for your mistakes in the corporate world. A mistake on my part can cost my clients thousands of dollars, so I take the time to make sure the odds are as low as possible that I make that kind of mistake. My guess is that whoever posted the error is over-worked and underpaid, making mistakes likely. Whose fault is that?

  10. I never understand when people get worked up over issues like this. Everyone KNEW this was a mistake rate. If they honored it great, else move on.

  11. FatGary,

    You are so disconnected with what happened here. The “buyers” didn’t make the mistake or to do anything dishonest. Sheraton made the mistake. And, if I understand “contract law” correctly, Sheraton should honor the rate. Since the rates were only available at certain hotels, on certain dates, Sheraton should absorb the loss for hotels. As, Sheraton runs central reservations for the hotels. I think the buyers could make a fuss about this and win.

  12. @Ray

    The wikipedia article you supply has posted in it’s references the following:

    http://news.bbc.co.uk/2/hi/business/441740.stm

    In it, it says, “However, if the company accepts your order electronically then there may be a valid contract.

    A customer who gave Argos his credit card number received what was called a Unique Order Code. That may be proof of a contract…”

    It also makes mention of the fact that if it’s a genuine mistake, they may not have to honor it. And this is also from the UK, so it may matter less, but the fact remains that the invitation to treat typically deals with advertisements which tend to get people into the store, not a completed transaction which is the case with these hotel rooms.

  13. There are two issues with regard to FatGary’s post.
    The first is that he was rude to two fellow contributors stating that they did not have a similar moral ethic to him. This is just insulting and the comment should be deleted.
    The second issue pertains to Starwood as a business making a significant mistake. Granted there are several reasonable arguments on both sides of this issue. That FatGary’s argument was a weak argument. This was a non-refundable reservation. I have never heard of an airline nor a hotel refunding customers their money when they have made a mistake on a nonrefundable fare. At a minimum Starwood should have made some type of gesture.

  14. Ray,

    Reread your Wikipedia link. There was no offer for bidding. These transactions weren’t an offer to bid or negotiate a price. And, although US legal system is based upon British common law, after 200+ years, US laws are very different.

  15. Considering Starwood has a special running right now on its website for $4 second nights (as a legacy rate if I remember correctly) on St. Regis hotels this is an interesting decision.

  16. @FatGary: It seems a shame you make judgments about people, and feel free broadcasting those judgments, based on so little data.

    @MJA: Thanks, appreciate your words.

    The way I look at this is that it’s a loyalty and customer relationship issue. I don’t fly DL, ever. If I purchase a non-refundable ticket, and then realize a couple of days later that I did so by mistake, I fully expect that if I call them and explain the situation, they’re going to tell me that they won’t refund my money, but instead would be happy to give me a credit toward future flights, minus, of course, change fees, yada yada yada. In other words, I’m not getting my money back. I’m a 1K with UA, and in fact I’ve been in that situation, and they’ve taken care of me. I’ve been in the same situation with hotel chains where I was a high-level elite, mistakenly reserved a non-refundable room, and got it cancelled without penalty.

    I’m not a lawyer and don’t know what Starwood’s rights and responsibilities are in this case. But I do know that, when it comes to their frequent guests, they’d be well advised to do something for them in this case, whether it’s honoring the original reservation or compensating them in some other way. Hyatt and Hilton are just a click away.

  17. FatGary is completely correct. Starwood made a mistake, you knew they made a mistake when you booked it. You are in now way inconvenienced by this cancellation and yet somehow feel cheated and think you have a right to demand anything of Starwood?

  18. Yeah, I’m with VU. As long as they provide a refund for the people who bought instead of booking, then it’s such a non-issue.

  19. I booked this deal and just received the email as well. I figured that this might happen, but I was under the impression we were entitled to compensation for the cancellation?

  20. @ Jeffsetter — The hotel can certainly issue compensation as goodwill (and in the past with mistake rates that’s something hotels have sometimes done), but this isn’t government regulated or covered by any terms or anything…

  21. Lot of people here confusing what the hotel “should” do with what they are “required” to do. Law is not the same for hotels and airlines. You saw a mistake, you knew it was a mistake, they’re not obligated to honor it. Clear cut in this case where a cancellation came quickly and long before the time of reservation. (Argument gets a little more confusing if it took a long time to cancel or it was very close to reservation date). Kind of surprised by the tone of the posts that seem to take a gleeful view of sticking it to a hotel company that makes a mistake. Do you really think this was them trying to advertise falsely? Should they have offered something as a good will gesture to those whose reservations were cancelled – probably. But I have no problem with them doing this although if I booked I’d be disappointed – but not surprised.

  22. “To add insult to injury”

    What injury?

    Something is terribly wrong in our country when people feel entitled to take advantage of other people’s mistakes and throw a tantrum when they can’t do so.

  23. Eric, JohnB,

    Was only referring to the store analogy mentioned by a couple posters up – the wikipedia link refers to the price tag in the store as being being different from what happened here. The difference between an invitation to treat and a contract isn’t obvious to everyone…

    However, JohnB – with the proviso that I am not a lawyer, the US laws in this situation are pretty similar, it’s just that customer service and consumer protection laws might lead you to think that what is in effect a gesture of goodwill often extended to you is required by contract law and this is generally not true (even in many states in the US).

    Not saying SPG should honor this or not, but saying that they legally have to by analogy to a significantly different situation where the vendor clearly doesn’t have to isn’t persuasive.

  24. @ voice of reason – I agree completely. You expressed it much better than I did in my early post making an analogy to a obviously grossly mispriced suit at Nordstrom (which seems to have been deleted – not understanding why, Lucky.)

  25. Fat Gary, Voice of reason, VU, Wwk5d,
    It is fine for you to parrot each other’s opinions. It might be helpful if you made a cogent point rather than negativity and insults. MJA in his post was reflective about the fact that he could understand arguments on both sides and made a thoughtful argument that if the shoe was on the other foot with regard to a nonrefundable reservation

  26. I love the reference above to someone saying “it’s a loyalty issue” Why on earth would a company want to be loyal to any “customer” who knowingly tries to take advantage of them. By extension, is a “customer” who knowingly tries to take advantage of that company actually being “loyal” to the company.

    Sort of like suggesting that a man who cheats on his wife is actually “loyal” to her because he does come home at night rather than sleeping at his mistress’s house.

  27. @Frank B – comparing jumping on a $30 room rate at the St. Regis with purchasing a non-refundable airfare is totally an apples to oranges comparison. Anyone with common sense knows about non-refundable airfares, just like anyone with common sense knows rooms at a St. Regis, don’t go for $30. People being indignant about this really amazes me.

  28. I’m glad to see that most here realize that it was a mistake rate and don’t feel entitled. It would have been nice to stay there for $30 but I understand their decision not to lose hundreds of thousands of dollars.

  29. Let me clarify a few things.

    I’ve never said I felt “cheated”. I haven’t argued that Starwood is legally obligated to do anything. I’m not throwing a “tantrum”. I’m not “indignant” about this.

    It’s simple. Starwood offered rooms at an extremely favorable rate. I booked a room at that rate. They don’t want to honor that rate because it was a mistake. Now it becomes a business decision for both parties. Are they concerned enough about my loyalty (35-55 paid nights/year plus $10-30K/year on my SPG Amex over the last few years) that they’re willing to do something to make me feel better about them cancelling my reservation? And if they don’t, will it affect my decision on which chain to frequent in the future?

    I’m not emotional about it at all — it’s just business.

  30. If it were “just business” you wouldn’t mention “loyalty” since loyalty is an irration emotion. If it were “just business” you’d always stay at the cheapest room, regardless of brand or accommodations.

  31. @RJP

    In some cases, and for some people, loyalty may well be an irrational emotion. It’s not for me, at least not when it comes to frequent flyer/guest programs. I was an AS MVPG for years, but when I realized that my upgrade rate (as a 1K) on UA transcons was > 80% but had dropped to something like 20-30%, and there was no equivalent to E+ as a backup plan, I switched my business and now I have no status with AS. But I was never angry with them, wished them well, and in fact continued to own stock in them after my switch. They’re a well-run airline, just not one that meets my needs. If and when UA reaches the point where their negatives outweigh the positives, I’ll switch away from them, but again, I won’t be emotional about it.

    Either I’m not explaining myself well or you’re just not understanding me. When I say “it’s just business,” I don’t mean that hotels are a bed and four walls to me, nothing more, and I’m going to be staying at Motel 6 from now on. I make decisions about which hotel to stay at based on all sorts of factors: price, room quality, on-site amenities, location, and, yes, the benefit I see to myself in aggregating my stays with a single hotel chain in order to receive higher levels of benefits.

  32. Nothing worse then bottom-feeders looking for goodwill gestures by booking mistake fares.

  33. It sounds like the comment section is being overloaded with industry shills. They are taking thoughtful conversation and degrading it to a taunting and insulting tone.
    Starwood and the other hotel and airline loyalty programs see this as a business. They have no problem keeping revenue and fees on non refundable rates. RJP they have no problem unilaterally significantly changing the terms of the value of the points and rules to their loyal customers. They promise us benefits if we are loyal to them and then significantly change the terms on the deal. What company would take advantage of their loyal customer? Using your prior example I don’t know if that’s the type of relationship you have with your wife?
    It is one thing to be an employee or an apologist for the company. It is another thing to be insulting to another poster when he brings up a valid point that it is just business.

  34. By my tally, I and others in my boat have been: accused of lacking a sufficient “moral ethic”; told we think we’re being “cheated”; told we’re throwing a “tantrum”; compared to a man who “cheats” on his wife; told we’re “indignant”; and called “bottom-feeders”.

    If you disagree with me, I’m cool with that. I understand the other side of the issue and why someone might feel differently about this than do I. But please leave the insults and name-calling out of it. They don’t contribute anything to the discussion.

  35. I’m intrigued that everyone seems to assume this was “obviously” a mistake and those who booked it were “taking advantage.” I’ve seen sales gimmicks that gave away much more for much less just for the P.R., which is exactly what I suspected this was. (If you wanted to get customers checking your website regularly, what better way than to have word get out that, now and then, you toss out $30 suites?!) That said, I still think they should compensate those who booked rooms with Something–it’s just good business. What they are doing is clearly BAD business.

  36. People need to stop whining. I was able to book the empire suite for $75, expecting it to be denied. Denied.

  37. @E – Agreed. Talk about an entitlement attitude.

    @mbh – I’m sorry but let’s face facts. Most of the the people on here whining wanted to get something for nothing.

  38. If anyone prepaid these reservations and SPG charged your credit card, then this reservation becomes a contract. The hotel then has to honor it. Once the money changed hands, it became a contract. I don’t think anyone that made these reservations, prepaid. But if they did, even one night, the hotel is obligated to honor that rate. Now, is there government enforcement? NO. You’re on your own. That’s probably why the hotels act the way they do. Example, of how little hotels care, “walking” guests with guaranteed reservations. Since hotels have been so busy lately, overbooking is a regular occurrence. Business has been so good, the hotels just don’t care.

  39. E let me get this straight….You spent part of your day reading blogs on travel deals like this and then booking a suite expecting to be denied. Your goal came true and you were denied. I think your day might be better spent just thinking about that than labeling others “whiners”
    With regard to your friend Mike this is a blog where people get great travel deals, top loyalty statuses, find travel shortcuts. Please read Lucky’s header above. You are of course entitled to whine….

  40. I`m a liitle surprised that Starwood didn’t at least offer a substantial discount to those who booked. Last year a number of us were able to book $30 rooms at The Phoenician in December. The hotel eventually offfered the rooms for $130/night + double Starpoints (which I accepted). It left me with a very positive impression of The Phoenician and Starwood. I guess the difference may have been that it was just one hotel who handled it themselves.

  41. “JohnB said,
    If anyone prepaid these reservations and SPG charged your credit card, then this reservation becomes a contract. The hotel then has to honor it. Once the money changed hands, it became a contract. I don’t think anyone that made these reservations, prepaid. But if they did, even one night, the hotel is obligated to honor that rate. Now, is there government enforcement? NO. You’re on your own. That’s probably why the hotels act the way they do. Example, of how little hotels care, “walking” guests with guaranteed reservations. Since hotels have been so busy lately, overbooking is a regular occurrence. Business has been so good, the hotels just don’t care.’

    In fact, these were prepaid rates. My credit card was dinged for the whole amount within 12 hours of making the res. No refund as yet.

  42. I was also charged the full amount plus taxes and fees immediately.
    Is there an attorney who can further clarify John B’s point and how we might be able to get AMEX to press this point with Starwood?

  43. The charge for the full stay had posted on my account.

    I wonder what kind of controls were exercised in handling this charge on the hotel level. I think regardless what kind of or even how advanced their CRS is, there will still be manual controls that they employ at the hotel level before they process the charge, authorize for an amount and before they even submit the batch of transactions to the bank.

  44. @Swift Justice

    Aw, thanks for allowing us to actually agree with others opinions through a backhanded compliment. Agreeing with other people isn’t necessarily parroting. By your logic, all the people who do think the hotel should honor the booking are parroting each others opinions as well, I see.

    If people aren’t happy about this whole ordeal…stop staying with them. If they already charged you for it, then they need to honor the booking or just give you a full refund. That’s all they owe you. If you feel they aren’t “rewarding [your] loyalty”, then again, stop staying with them. It’s that simple.

  45. A.) Would any of the people who are claiming that they should receive compensation care to cite what sort of actual damages they have suffered. That’s the most equitable way it determine appropriate compensation.

    B.) Would any of the people who are claiming that they should receive compensation accept the St Regis finding them an alternate $30/night room in DC? After all, if your intention was to book a $30 room – rather than to get over on the hotel” – you should be good to go with pretty much anything, I would think. YMCA, youth hostel, what have you.

    C.) Would any of the people who are claiming that they should receive compensation accept the St Regis offering them 50% off the rack rate on a $2,250/nt suite as long as you book a non-refundable reservation fir the same nite? $1125 is pretty good compensation, no?

    D.) Have any of the people who are claiming that they should receive compensation read to Terms of Use of the website they used to make the reservations?

  46. RJP and wwk5d,
    It is hard to know whether your hired Starwood flacks or just irritating jackals spouting off your sophomoric thoughts. I hope for your sakes it is the former. Regardless I hope someone with real knowledge

  47. Swift – I’m just a reasonable human being. Be interested in what sort of real knowledge “your” looking for?

    PS – have you read the terms of use on the Starwood website?

  48. What elucidation is needed?
    -there was a pricing error on the website
    -people used the website to make a reservation based on that error
    -in making a reservation on the website, those people agreed to the Terms of Use of the website
    -the Terms of Use of that website clearly state what will happen in such a case
    -the reservations were cancelled, in accordance with the Terms of Use

    Pretty straightforward.

  49. @Swift Justice – Seriously?? “Industry shill”? “Starwood flak”? “Irritating jackal with sophomoric thoughts”? RJP pretty much nailed it. You might want to reread your own comments before you start calling out others about their insulting tone. Two quick points, though. I’m hardly a Starwood flak. I stay there a few times a year – almost always on points from my Amex SPG card. Pretty fair and square. Second, I think most people reading this blog are looking to keep abreast of deals and promotions that make our points and miles go further. That is the “game” that Lucky talked about in a recent post. Expecting Starwood to honor an obvious website glitch is quite a different animal. The ethical difference seems pretty obvious.

  50. Those claiming that Starwood should be required (by law) to honor the $30 rate need to read up on the contract law doctrine of unilateral mistake (and the remedies therefore, including rescission of the contract, which is what Starwood did here). If anyone wants to go to court and argue that they did not know (or that an objectively reasonable person should not have known) that a $30/night rate at a St. Regis was not a mistake, good luck with that claim.

    Those claiming that Starwood should (as a matter of business practice) honor the rate or offer some other compensation need to ask whether those who try to take advantage of obvious errors are the kinds of customers Starwood wants to reward. Perhaps Starwood loses some customers who are unhappy that they were not rewarded for trying to take advantage of the company, but those customers likely do not fit the profile of those with whom Starwood wants to maintain a long-term relationship.

  51. JohnB — There may be a contract once consideration is exchanged, but the contract is voidable by Starwood for unilateral mistake.

  52. For the complete avoidance of doubt, invitation to treat is NOT at play here as regards compelling the hotel to honor the rate. This always comes up when companies have mistake rates/fares, and people misunderstand what invitation to treat is. Under invitation to treat, shop owners are not required to sell at the advertised price! It may well be false/misleading advertising or some other type of deceptive practice, but it’s not a situation where the hotel must follow through on the offer because the website price constituted an invitation to treat.

  53. @Storm – Good legal and business goodwill summation. Whether one looks at this from a legal, business or ethical standpoint the reasonable conclusion seems to remain the same.

  54. As of this morning, the charges for my reservations posted to my credit card…does it sound like these charges will be refunded when SPG cancels the reservations on June 4?

  55. David – just go in and cancel the reservation yourself. This should force the refund. Why wait?

  56. The terms of the rate scared me…

    “Your prepaid deposit cannot be refunded…If you cancel between today and 08:00 PM on Sunday, 01 November 2015 the forfeiture amount will be 20.00.”

    I thought their internal cancellation would do something different, and if I cancelled manually, it would not trigger a refund because of the stated policy and terms.

  57. Storm,

    Not arguing whether they have to honor the rates, but Starwood does have to refund those payments asap, if they are not accepting these “bookings” as legitimate. Actually that is Starwood’s only obligation by its terms and conditions on its website. The clause is “Miscommunications/Lost Transactions”.

  58. David,

    Did you get the email that Lucky received? It is a 18 months from now, so I would wait awhile to see what Starwood will do. I didn’t make one of these reservations. But, from what I have read on all the blogs, there must have been quite a few individuals who did. $20 shouldn’t be big deal to you if you cancel now, but I would wait. Let, Starwood cancel this reservation, as Lucky’s email says he could cancel with no penalty.

  59. This wasn’t entirely unexpected but I do hope that some people’s reservations can sneak through, after all, it was more than just one hotel 🙂

  60. @Swift Justice

    I love how anyone who disagrees with you is either a “hired Starwood flacks or just irritating jackals spouting off your sophomoric thoughts”. Because, you know, if someone doesn’t agree that Starwoods owes people the original booking or 6 free night in compensation, then they must be flacks or jackals. Heaven forbid the possibility that a reasonable person may disagree with you. This has to be the stupidest counterargument since people starting calling people who disagree with them “haters”.

Leave a Reply

Your email address will not be published. Required fields are marked *