Implications Of Marriott Buying Starwood

WOW, WOW, WOW!

There have been rumors about a Starwood takeover for just about the entire year now, and Starwood’s CEO has even gone so far as to say that he expects Starwood to be taken over by the end of the year.

The big question has been who will take over Starwood. There have been many contenders, and at various points this year we’ve heard rumors of possible takeovers from Wyndham, IHG, and Hyatt. We’ve even heard about the possibility of Chinese investors buying Starwood, which would have almost been my preferred option, as it gave Starwood the best shot of continuing to be run independently.

Well, this came out of left field, as it has just been announced that Marriott will acquire Starwood in a $12.2 billion deal, making Marriott the largest hotel chain in the world.

Marriott-Starwood-Merger-1

Here are the basic details of the takeover, per the Marriott press release:

Marriott International, Inc. and Starwood Hotels & Resorts Worldwide, Inc. announced today that the boards of directors of both companies have unanimously approved a definitive merger agreement under which the companies will create the world’s largest hotel company.  The transaction combines Starwood’s leading lifestyle brands and international footprint with Marriott’s strong presence in the luxury and select-service tiers, as well as the convention and resort segment, creating a more comprehensive portfolio.  The merged company will offer broader choice for guests, greater opportunities for associates and should unlock additional value for Marriott and Starwood shareholders.  Combined, the companies operate or franchise more than 5,500 hotels with 1.1 million rooms worldwide.  The combined company’s pro forma fee revenue for the 12 months ended September 30, 2015 totals over $2.7 billion.

And here’s a handy diagram they made regarding the takeover:

Marriott-Starwood-Merger

On one hand I’m devastated to see Starwood taken over in any capacity, since I love them as an independent brand. That being said, to try and be as unbiased as possible:

This takeover is a smart move, in theory

The reason Starwood has been underperforming is because they’ve been lagging the competition when it comes to limited service properties. They have nearly a dozen hotel brands, but very few of them are limited service. Instead they mostly have “lifestyle” brands, which means they’re missing out on a big portion of the market.

Marriott, on the other hand, does really well in the limited service market (they have Courtyard, Residence Inn, Fairfield Inn, etc.), and also does well with more “traditional” brands.

So this does seem like a better fit for Starwood than Hyatt, in my opinion, where I really didn’t see any synergies, given that Hyatt also doesn’t do very well in the limited service sector.

Still, the “new” Marriott will have a total of ~30 brands, which is sort of insane. I can’t keep track of the brands from just Starwood or Marriott, let alone their combined brands.

Marriott-Brands

SPG-Brands

What does this mean for Starwood Preferred Guest?

I obviously can’t offer any useful financial analysis on the takeover since that’s not my area of expertise, though I can opine on what this means for the future of their loyalty programs.

Both Marriott Rewards and Starwood Preferred Guest have very loyal followings, so what’s going to happen to the two programs?

  • If there will be only one surviving program, I suspect it will be Marriott Rewards, given that it’s more than twice as large as Starwood Preferred Guest
  • The transaction is only expected to close in mid-2016, so nothing will change overnight; no need to panic or hurry to burn your points

Obviously Marriott Rewards and Starwood Preferred Guest are considerably different programs. Their elite benefits are different, their points earning structures are different, and the value of their points are vastly different (I value one Starwood Preferred Guest point at roughly three Marriott Rewards points).

Nothing is going to change overnight, and I sure hope that in half a year Starpoints aren’t converted into Marriott Rewards points at a 1:1 ratio.

So how could this play out?

  • It’s possible that both Marriott Rewards and Starwood Preferred Guest will continue to exist independently, much like there’s Ritz-Carlton Rewards and Marriott Rewards, even though Ritz-Carlton is part of the Marriott portfolio. There could be separate elite benefits at Starwood and Marriott properties, and they could continue to be operated somewhat independently, with some reciprocal benefits between the two groups.
  • It’s possible Starwood Preferred Guest will be merged into Marriott Rewards, and perhaps a few Starwood elite benefits will trickle their way into the Marriott Rewards program. If this is the case I think we can say bye-bye to suite upgrades, as many Marriott properties have very few suites. My hope would be that Marriott at least learns a thing or two from Starwood when it comes to how they treat their guests.
  • While I wish it were the case, I think it’s highly unlikely that Starwood Preferred Guest will be the surviving loyalty program. Even though I don’t personally consider Marriott Rewards to be especially rewarding, there’s no denying that they have a larger member base and also score quite well in terms of member satisfaction. I suspect they’ll take the “if it ain’t broke, don’t fix it” approach.

W-Taipei
Bye bye Starwood suite upgrades?

Bottom line

From a business standpoint I “get” this takeover. There are synergies between the two hotel groups, unlike some of the past potential takeovers we were hearing about. However, as a loyal SPG member, I’m kind of sad to see what will ultimately likely translate into the death of Starwood Preferred Guest.

We’ve seen what less competition has done to the airline industry, and I have no reason to believe it’ll be any different for the hotel industry. I wouldn’t be surprised if this leads to further consolidation among the remaining “major” hotel chains.

How do you feel about Marriott taking over Starwood, and what do you think it means for their loyalty programs?

About lucky

Ben Schlappig (aka Lucky) is a travel consultant, blogger, and avid points collector. He travels about 400,000 miles a year, primarily using miles and points to fund his first class experiences. He chronicles his adventures, along with industry news, here at One Mile At A Time.

More articles by lucky »

Comments

  1. Might this “merger” be akin to the IHG/KImpton arrangement where both both programs seem to be continuing as is?
    Also, might AMEX and Chase(whom I assume were both consulted long prior to the deal being announced) want to maintain their separate deals with each chain?

  2. Great business move as you noted. Marriott has a huge portfolio of hotels especially in the select service range where SPG is lacking.

    However, from a loyalty program and points perspective this is terrible. Marriott is one of my least favorite loyalty programs and SPG one of my favorites. Marriott’s program will more than likely be the surviving program.

  3. Ugh!! Didn’t imagine this scenario. My wishful and delusional thinking at this point is that Marriott realizes that by keeping the two programs they now have relationships with Chase and Amex and United and Delta flyers. Why kiss any of those relationships goodbye especially if you can cross pollinate the benefits like Ritz and Marriott.

  4. Hi Lucky. My wife is SPG Gold. I presume the suite upgrades that you mention don’t kick in until higher status. Can you elaborate? Thanks.

  5. If they merge both programs I hope SPG points are NOT going to be converted on a 1:1 ratio! And what about people who have banked lifetime nights?

  6. Funny story… last month I made a very early booking for the W San Diego in mid-2016. Two weeks later I get an email from SPG telling me that the W San Diego will be leaving the SPG family in December and transitioning to another hotel chain. Lo and behold… I find out it will become a Marriott.

    The W San Diego predicted Marriott buying SPG! :/

  7. Ben, aren’t you at all worried about your lifetime status with SPG? Do you think it will carry over? Or will you have to start all over again and build lifetime status.

  8. What’s wrong with Marriott rewards your game way more rewards send the starwood preferred Guest. with all the Marriott bonuses I get to redeem a travel package at least once a year. Those are an awesome value. I just got 144K American miles and 7 nights hotel for 270K Marriott points. $13000 in spend got me that with bonuses. SPG I would have roughly 65000 points for that same spend with all the bonus opportunities and that would get me 50,000 less airline miles and zero hotel nights.

  9. Would be interesting indeed to see what happens with the merger of programs. Mainly, what happens with the transfer partners from SPG? Would Marriott adopt that aspect? That would increase the value of Chase UR points, overnight. Would I still get SPG gold from Amex Platinum would be a pretty big deal to me. That would be another, and most likely the last, strike against having the Amex Plat.

  10. I personally prefer Marriott Reward’s program to SPG’s. I switched a few years ago and have been much happier with both the rewards and the service at Marriott properties. It’s likely that the Starwood properties will retain distinct operations and identities much like Kessler and Ritz-Carlton. I’ll welcome the addition of more properties from which to choose. This should be a win for everyone.

  11. Any idea of what might happen to Lifetime SPG benefits? I know airlines typically migrate over lifetime members. I’m only Lifetime Gold but it at least it’s something.

  12. I think it means a Lucky trip to spend his SPG points, and American points before they become worhless in the latter case and unuseable in the former. 😉 Am I right?

  13. I too made reservation at w San Diego and heard it was leaving spg family (mid December 2015) and am saddened because spg is the best and will lose its great benefits that the cookie cutter Marriott doesn’t have

  14. This is horrible news. Marriot points are akin to airline miles while SPG has actual value.

    So long all loyalty programs, back to a world when all options are on the table and service is out the door.

  15. This is horrible news to me on many fronts, probably because Marriott is the only program I am not a top elite with. I cherish the SPG Amex cards that offer me 5 nights/stays towards my status each year as well as my Delta Crossover rewards points. I love Starwood hotels, especially the St. Regis. I just hope they merge the best of both worlds and hopefully keep status levels somewhat doable. 75 nights for Marriott to reach Platinum is much higher than 25 stays/nights for SPG to reach Platinum. Even Gold with Marriott is twice as many nights/stays at SPG’s Gold. (I am assuming 1 night = 1 stay in this example for simplicity). That would be a HUGE loss for SPG’s loyalty program benefits. There are so many aspects for them to work out. Let’s keep our fingers crossed.

  16. I was going to leave Marriott for SPG. I grew tired of the poor service I received from the Marriott brand hotels. I love Hyatt and never have a problem with them. Bigger isn’t always better. Look at United, Delta and AA which are in a race to the bottom.

  17. Marriott and Ritz Carlton Rewards are the same program with different branding but crucially, the benefits at Ritz properties (for both) are different from rest of Marriott’s full service brands and distinct again from the benefits at select service brands.

    So Marriott does have experience in running a tiered program. My guess is SPG is surviving this (not the name probably, but the “tier”)

    Lifetime status isn’t *entirely* under threat. You will either convert to a lifetime member in the new program or retain your current ‘level’ of activity and have to put in the difference to gain it again.

  18. You may say 1 starwood point = 3 marriott points but it is significantly easier to rack up Marriott points when it comes to stays (i.e. with a Marriott CC and no status still get 15x points for every dollar spent). Could definitely be worse. I find Marriott really undervalued in the travel blog world for some reason when considering how easy it is if you’re completing stays to get Marriott points.

  19. Tier alignment is my biggest concern since MR’s tiers are based solely on nights while SPG’s have a stay count that is half the number of nights. This means SPG’s tiers are one level below MR’s, i.e. SPG Platinum is Gold with MR (albeit requiring twice the minimum number of nights, 50 vs 25 if earned through one-night stays). SPG Gold will likely become MR Silver. SPG’s enhanced Platinum (75 nights+) would match MR’s own Platinum tier. As for conversion of SPG to MR points, since each $1 at a Starwood property earns a base of 2 SPG points, and each $1 at a Marriott brands property earns a base of 10 MR points, our SPG balances will multiply by a factor of 5. No program has moved miles/points at a level below the corresponding earnings rate per $1 so I don’t worry about losing in this aspect of the merger.

    Since nothing will change with the two programs until the end of next year (if the deal closes mid-2016) and thus likely start with a merged program at the beginning of the 2017 benefit year at the earliest, more relevant will be the reciprocal treatment of elites through next year. (And it’s likely we’ll continue to see UA as the airline elite benefits partner with DL — SPG’s partner — being dropped.)

  20. When the American/UsAir merger went through, I was already heavily loaded in AA miles via credit card spend. I managed to sign up for the Dividend miles cards just before the merger, and got to increase my mileage quickly by taking advantage of two separate CC award systems without churning.

    As someone without a significant points base with any one hotel brand, is there an opportunity here to load up on points? Is there a similar option here over the next year to go after fee free CC cards with points in each program with the aim of having a high total when they combine?

  21. Being a die hard SPG elite member (Amex plus owns a vacation property) for the last 14 years, this news sucks. I can see the writing on the wall for SPG – similar to what happened to Continental with the United acquisition (service now sucks) – will become extinct within a year after the transaction closes. I am not a fan of Marriott Rewards as I dropped it to become a SPG member. I guess I will have to find another loyalty program!!

  22. I have been platinum for about three years. I have been upgrade to suites in every single one of my stays but one (because there was none available)
    I am extremely satisfied with my benefits and with everything that come to me as Platinum in Marriott.
    I had the chance of being part before of SPG reward program and I never experience not even half of all the benefits I have had being platinum with Marriott.
    I know competition is healthy but I am so happy of this takeover since in this case it is my favorite hotel chain which taking over SPG. I like St Regis and the luxury collection but the lack of benefits for me makes stay at JW every time I can.

  23. As a loyal SPG Rewards guy the best part of SPG program is at the platinum level the suite upgrades. I would say half of my 50 nights a year were in a suite, your not getting that with Marriott. With that being said if I get to keep my lifetime gold and you convert my 200,000 star points using the 10 to 1 formula the Marriott uses to reward there members, I say goooo Marriott.

  24. Very curious how you got to 1 spg point = 3 MR points. given you get 2 spg points per $ at SPG hotels and 10 MR points per $ at MR hotels, I would how they would convert at 5:1. that just makes the most sense based on their own parameters.

    I’m very curious how they are going to combine their lifetime programs and their overall elite programs, given how differently they are each created.

    Sadly, I thought the biggest benefit of SPG was the ability to upgrade to a suite as available at check-in and that you get 10 Suite Nights per year. I am PLT on both (and have been for many years) and the one thing that annoys me most about MR is the pure lack of upgrades. They won’t even bother to upgrade you to a better regular room unless you bring it up specifically and even then, its a fight.

  25. So Lucky, coming from someone who just got into the points game and doesn’t have either card, what is your recommendation to maximize my points in each program before this happens? I know I want the SPG card because I”ll transfer all those points to AA miles regardless, but is it worth getting any other cards now just for the points or rewards?

  26. @adam @lucky
    yeah the most important thing is what about the uber relationship (free points right there).
    and the delta crossover… I wonder if they do both because right now they have this bs crossover where if you are a certain level with Marriott you get silver with united.
    I can see the crossover smashing with delta because they already have the partnership with united… but who knows.

  27. I have been staying at Sheratons since the 90s and Starwood properties since they took over, and have been Gold, Corporate Preferred et al. I prefer the currency. Prefer the properties, prefer the brands, prefer the loyalty programme, prefer everything. Have stayed at Marriotts before; they don’t compare. I foresee many future res screw-ups etc, a la Seinfeld –

    “See, ya know how to TAKE the reservations…you just don’t know how ta HOLD the reservations…”

  28. For those looking to read tea leaves, here is the quote from Marriott’s CEO regarding the loyalty program, per the WSJ: “We became more convinced about the advantages of size by combining the two companies together,” Mr. Sorenson said. “We thought that would bring more options for customers and create a bigger loyalty program. We’d have the ability to compete better, invest in technology and stay front and center with customers.”

  29. Not sure why people are worried about lifetime status. You will maintain your account history and carry it over to whichever program survives and/or the new combined program if they even merge them.

    Lucky’s valuation of 1 SPG point = 3 MR points is correct since consensus value of 1 SPG point is 2.3-2.4c whereas Marriott is 0.7-0.9c.

    The higher earning rate at Marriott (1 USD = 10 pts) vs SPG (1 USD = 2 pts) doesn’t matter since its the value of the points at hand and what they can get you which defines how much they’re worth. The programs as well value them close to consensus estimates (and sell them at slightly over those amounts) and they’re the ones making the decisions here.

    Also SPG earning accelerates to 150% at Gold (10 stay/25 night) and 200% at Plat75. Marriott touches 120% at 10 nights, 125% at 50 nights and 150% at 75 nights. So for elites, the earning increases quite slowly. With SPG, it doubles. So with the multipliers factored in, the earning evens out

  30. To those that mentioned SVO (Starwood Vacation Ownership): It was announced a month ago that Starwood is selling SVO to Interval. So this Marriott merger has little to no impact on SVO.

    I have a feeling (this is just a guess) that divesting itself of SVO was needed to make the merger go though.

    And… I value SPG points closer to 4:1, not 3:1

  31. Marriott is a tier below Starwood its just a fact they have very few elite properties like St. Regis, i left Marriott because there mid grade properties are gross and dated. Most decor looks like grandma’s house. A few Ritz Carlton’s are nice but Starwood is better in this space im Platinum with SPG and this news stinks. Marriott is a brand that may be worse or equal to Hilton. Not anything but dollars and sense here but truly dissapointing.

  32. What does this mean for the thousands of employees that work at both Marriott and Sheraton? Will we loss or jobs..what if they red flag?

  33. if my personal experience ia trend, then I think I can predict what will happen. I am a frequent business traveler to Canada and headlong hundreds of nights a year at the Delta hotel brand. When Marriott announced its takeover of Delta last year. When the merger finally closed this summer I was given a deadline to use all my Delta free night stays and other upgrade benefits. Then All of a sudden I was given Marriott Platinum status for two years. There was also a delay in receiving Marriott benefits for Delta stays. I guess the two year platinum status was to make up for that. But no aspects of deltas program including 500 Air canada points with each stay transferred over. 🙁 Hopefully Starwood’s larger footprint may give the program an advantage that Delta Hotels loyalty program didn’t have.

  34. As somebody who spends between 30-45 nights a year in hotels, but in different parts of the world, I don’t focus on status, but rather on staying in the best possible hotel I can in a particular geographic location for the amount of money I’m willing to spend.

    I’m supported in that by my having Gold status at Marriott, Hilton & SPG through various credit card affiliations.

    For those of us who aren’t platinum w/ SPG, (putting aside any change in redemption rates – who knows what will happen there) I don’t think this is a meaningful loss. I may be misanalyzing the situation (because I don’t care passionately about hotel status), but I think this is a win for people who are moving from SPG Gold to Silver. I never got an upgrade on the basis of my SPG Gold status, so the only tangible perk (other than maybe “confirmed” (sarcastic quotes intended) late checkout) that’s different isn’t really a tangible perk.

    By contrast, since I am comped MR Gold through UA (assuming that stays in place), I think it’s a win.

    The one thing I will miss is the ability to transfer Amex points – I used those a lot with SPG in different parts of the world. I don’t know if the gift card option works as well.

    Greg

  35. Starwood properties and the SPG program are soooo much better in almost every facet than Marriott. I’m sorry to see the end of the SPG era on the near horizon. No doubt in my mind that the SPG program will sink to meet that of Marriott’s. I am Platinum SPG and Gold MR. I feel far more valued when I stay at a Starwood property (even when I was Gold with Starwood); most Marriott properties just don’t seem to care if you are a loyal customer or not. I’m just another guest. Unfortunately now, I fear the merged company will be just another hotel chain, biggest or not.

  36. The best program for the people who do not travel a lot is Starwood by far….. Many of the people commenting are frequent travelers and get the huge multiplier…. congrats. But if you look at it through the eyes of someone who just gets points via spending Starwood is much better.
    As companies continue to prevent people from traveling and using Skype and other tools to connect, to save money, fewer people will be able to get points via stays and the Marriott fans will have less spending power for personal travel…with Starwood you would need to spend 10,000 for a free night at many chains. With Marriott 50,000. So if you are in the elite “I travel a lot group” great. If you are like most of us you’re totally screwed.

  37. Starwood lifetime gold and close to lifetime platinum and have had a SPG ambassador for last 2 years. I am extremely worried what will happen as no status with Marriott. Had planned to reach ambassador status (100 nights) with SPG again this year but now unsure if it is even worth trying as doubt it will give any extra benefits when they become Marriott.
    What does everyone else think?

  38. From mileage transfer point of view, 1 Starpoint = 3.5 Mariott Reward points. It costs 20000 Starpoint to get 25000 miles (for most US airlines), and 70000 MR to get the same 25000 miles.

  39. You think they give the 1 to 5 SPG to Marriott just to try to keep people on board with the merger. I would think they would want to entice the loyal people of SPG to stick with Marriott and at least force them into trying them out.

  40. Look on the bright side! Ritz Carlton has some pretty stand out properties, and Bulgari Resorts are insane. I’d argue that the Bulgari is the best hotel/resort in any city/region they are located. Also, Delta has a super cool all-inclusive luxury camp in Botswana.

  41. SPG Lifetime Platinum here (earned Platinum status literally from the day it was invented. Also UA 2Million Miler, but that’s another story). It is almost certain that benefits upper-tier SPG members have gotten used to will disappear. There is simply no reason, given the elimination of Starwood competition, to continue the generous perks. Starwood ran a great program, with great member benefits, because they made a business decision that it was worth it, given their relatively smaller market stature. Now, that won’t be nearly as much of a consideration. I predict: 1) SPG will terminate, survived by MR. 2) SPG Lifetime grandfathered status will transfer to MR at the same tiered level. 3) SPG points will be deposited in our new MR accounts one-for-one so if you have 100,000 SPG points, you’ll have 100,000 MR pts added to you existing MR balance if you have that too. 4) Suite upgrades – very rare. 5) Room availability – a little harder to come by. 6) SPG Amex – gone.

  42. 460 nights and 9 yrs. Only 40 nights to get lifetime platinum. Am I doomed to only lifetime gold because I won’t hit 500 until 2016?

    Big difference in benefits between Spg gold and platinum.

  43. @Vineet: “Not sure why people are worried about lifetime status. You will maintain your account history and carry it over to whichever program survives and/or the new combined program if they even merge them.”

    Says who? Nothing is certain in a merger.

    I may have played my cards wrong in all of this. I am SPG Lifetime Platinum … I was Westin Premier before that. And I have directed my reservations to Starwood as often as possible, to the detriment of other hotel chains.

    Albeit there is nothing to do but wait and see how it all shakes out, I fear for my devalued program and benefits. That sucks as I am planning to retire in 2016 and was going to cash in on some fabulous vacations over the next decade or two.

  44. This is sad news. As a gay man there is no way I am going to stay in a chain of hotels owned by Mormons – who by defination hate me.

    I call on all of my community to do the same.

    While Marriott is a great brand, its owners are Mormon and do donate large amounts to the LDS, who in turn run campaigns of hate towards me.

    No way am I going to fund that.

    Please consider your stance on human rights before making your reservations

  45. hmmm…. I thought Marriott was a publicly traded company? I’m sure you steer clear of Arabian oil as well. You better check your mutual funds…they may have Marriott stock in them…

  46. Oh no! What will happen to the boutique feel of brands such as the “w” and st. Regis. I’ve been to plenty of ritz carltons and they all have a corporate feel that is lacking in luxury. Every ritz Carlton that I have visited lately is overrun by kids. Will this merger destroy the elite feel of these two Starwood brands? I’m not worried about just my status…. But the product itself.

  47. i’m so happy to hear about my favorite hotel chain taking over SPG … marriott treats me very well; with the chase CC it doesn’t take much to gain elite status and room upgrades, free breakfast, etc. still doesn’t mean a marriott in santa barbara, though 🙁

  48. Starwood Vacation Ownership was sold off, but still retains a direct connection to SPG to convert ownership weeks to hotel points, and also lifetime statuses in SPG. I can’t imagine that Marriot could suddenly dismantle that as it destroys alot of inherent financial value. So, I am hoping SPG will stay or the timeshare ownership will get conversion and redemption rights and status in MR as we do in SPG.

  49. I guess this site is inherent for guessing and second guessing …. just like the new rumors popping up on FT all the time. [“RUMOR: Have you heard? United might start serving new coffee in 2018!”]

    All the guessing and hoping (mine included) is not going to achieve anything. Everything could stay as it is. Everything can be merged. SPG Lifetime PLAT may simply switch over….or come over to a lower tier.

    Nothing is certain now … and we just have to wait.

  50. Thanks for the reminder – BUT I do not have any mutual funds with investments in Marriott or any other homophobic company.

    I actually take a very proactive stand on my human rights stand – and ensure that I only deal with business’s who value me as a customer – and by they I mean a gay customer.

    The Pink Dollar has influence, here in Australia we are not dependant on Middle Eastern Oil, we have our own energy sources.

  51. At the highest status levels, Marriott rewards points are worth significantly more than SPG. For a free night at the highest tier Ritz in the world, you need to spend $3,500 at Marriott properties on their Chase card (70,000 / (15 + 5 points) = $3,500). For a free night at the highest SPG, you have to spend over $5,800 (35,000 / (4 + 2 points) = $5,833). Though I haven’t done the math at every status level and every redemption level, it appears to scale similarly down the chain.

    I’m a Marriott platinum member and always get a suite upgrade at Marriott properties. I also often get club and/or suite upgrades at Ritz, which doesn’t even officially offer such perks. You also get club access at Marriott, late checkout, free wifi, etc. So why do people keep saying that SPG is more valuable? It’s a matter of simple math – Marriott points are much easier to accrue and redeem, and the perks are comparable to SPG.

  52. Alain – check your facts. Marriott is one of the most gay-friendly companies in the world and was the presenting sponsor of the HRC national dinner last year as well as the gay pride parade in DC. They also fly rainbow flags at all their local properties during gay pride week in their respective cities. Check out their #lovetravels campaign for the LGBT community:

    http://www.marriott.com/marriott/marriott-gay-travel.mi

  53. @Lucky sez: “My hope would be that Marriott at least learns a thing or two from Starwood when it comes to how they treat their guests.”

    That comment right there is why this purported “analysis” about the implications of the takeover of SPG by Marriott is flawed, at best. It proceeds from the wrong premise that SPG is a better program than Marriott Rewards. However, if that premise were true, how is it possible for SPG, the superior program with “the single best and most valuable points currency in the history of travel loyalty programs” and “the most aspirational hotels” since the palaces of Babylon”, to get taken over and face extinction?

    Simple: because the bloggers’ – like @Lucky’s or Gary @VFTW’s — superlatives in describing SPG notwithstanding, the program was by far the most expensive and least rewarding in the business. There is no such thing as “reverse Darwinism” or “Survival of the Weakest”. SPG is about to disappear because it was fundamentally and structurally a weak program, whose approach to loyalty or hospitality was highly flawed: they were out to price the competition out of existence (and it boomeranged!) and to make it very tough for their loyal members to redeem their hard earned points for free stays at SPG properties; members can trade starpoints for miles at a slight gain, if they wish, but starpoints are useless for redeeming free stays because the program has by far the highest priced awards in the business.

    And, please, do not even get me started about the bogus and mindless claim that the starpoint is the “single most valuable points currency” because it is worth 3X more than the Marriott Rewards point or 6X more than the HHonors point. Anyone who makes that claim with a straight face and without taking into account the fact that one earns 3-5X more Marriott Rewards points or 6X more HHonors points a pop than SPG loyalists earn starpoints is stoooooopid and has no credibility because he or she may even have flunked grade school math.

    This is a great development, if only because it will at long last get travel bloggers to shut off the bogus claim about how SPG and its currency are the “best in the business”. As a Marriott Gold through the UA-Marriott JV and a SPG Gold through my AMEX Biz Platinum, this is a win-win for me, since both programs were my fallback options and now that they will likely be consolidated, they will conveniently offer more second choices under “one roof” than ever!

    The stronger hospitality company and loyalty program is about to swallow the weaker company/program, to reaffirm that Darwinism is alive and well… 😉

    G’day!

  54. That well may be the case BUT its just a marketing ploy.

    The profits that Marriott makes from its operation and that includes the profits from its rainbow / pink / or gay customers is donated to programs that are designed to spead hate and ensure that legislation like same sex marriage, or gay people equality is quashed.

    If you are convinced by a rainbox flag on a pole – go for it, BUT do investigate what happens to the profits and the donations the company makes

  55. Alain that is absolutely, 100% untrue. Marriott does not give a penny to anti-gay legislation, causes, etc. To the contrary, they helped support the repeal of DOMA, and refused to fund Prop 8 in California even though the Mormon church supported it. Marriott is a public company with public contribution and activism records. It is simple to find where they stand on the issues. Do your homework.

  56. @Alain — If you wish to boycott Marriott that’s your prerogative, but do not try spread your demonstrably paranoid canard that the company is anti-gay and that their strong record of backing the LGBT causes and their show of support are simply a “marketing ploy.”

  57. I am not in the habit of making paranoid statements.

    You can either investigate my claims or sit there and claim I am paranoid.

    Due Diligence is the suggestion

  58. So disappointing. I hope this does not affect the Weston timeshare that we own & our lifetime Platinum membership benefits with Starwood. I also hope they transfer my Starwood points over to Marriott at triple the value. Also, I will miss the suites and suite upgrades!

  59. @DCS your asinine claims that “starpoints are useless for redeeming free stays because the program has by far the highest priced awards in the business”, as usual, clearly shows you are a total tool to those of us who have redeemed millions of Starpoints quite easily

  60. UA-NYC — Well, your ARSEnine comment about my comment — without offering any data to rebut my claim — leaves no doubt about who is the “tool”, but (LOL) let me get this straight: you mean that I am “a total tool to those of [you] who have redeemed millions of Starpoints” and have made SPG and their loyalty program so successful and an envy of their competitors that one of them just mounted to hostile takeover…right? I feel your pain! 😉

    Seriously, the truth of the matter is that starpoints are not known for how many millions of them have been redeemed for hotel rewards. Rather, starpoints’ claim to fame is how many millions of them have been transferred to air miles and redeemed for award tickets…really.

  61. dcs is right to argue that hilton hhonors is better than spg program although i still think hyatt gold passport is a superior program to that of hilton’s.
    i firmly believe that hilton hhonors offers better return on per dollar spend when compared to spg.

  62. @DCS – “Well, your ARSEnine”

    Again with the personal insults.

    “Rather, starpoints’ claim to fame is how many millions of them have been transferred to air miles and redeemed for award tickets”

    Which is EXACTLY why they are so valuable to many people.

    @steven k – “dcs is right to argue that hilton hhonors is better than spg program”

    The problem isn’t whether he’s right or wrong, the problem is the arrogant, demeaning, boorish, and belittling way he treats others who disagree with him.

  63. Should be very easy to allow SPG lifetime gold/platinum members to retain that benefit, but I’m very concerned that Marriott won’t convert SPG points at a fair ratio of 3:1. With nearly half a million SPG points, I’ll be very tempted to start a class action lawsuit for damages if no one beats me to it. Won’t be using my Starwood AmEx any more until I know that the points I’m earning are going to retain their value after the merger.

  64. The decor of Marriott hotel rooms is so out of date and most of the rooms look the same across the world! Although they tried to go trendy by adding brands like Edition, but overall Marriott is for the older generation. As a frequent traveller in 20s, I simply cannot find any joy in staying in a Marriott/JW Marriott/Courtyard property…

  65. @stevenk

    I’m not even going to bother with DCS but very curious why you feel HHonors > SPG. Do you mean for redemptions only? If so, then it is probably true for the very high end.

    However SPG has a lot of sweet spots. The low end of SPG (Which is really the mid range of Hilton) and anything upto a Category 4 (which includes many 5* over the world) is either better or on par with rest of industry. Cat 5 redemptions start to pull away and Cat 6/7 get really expensive relative to others.

    However, when standard rooms aren’t available. For a tiny premium (10-15%) you can redeem higher rooms with SPG (non-suites) whereas for HHonors, you have to pay twice as much right away. Not something you ever see DCS mention.

    However, it is in on-property benefits where SPG blows everyone away (only Hyatt comes close but still doesn’t match)

    Checkout:
    SPG: Confirmed 4 pm for 10 stay/25 nights Gold and up members
    Hyatt: 4 pm only at 25 stay/50 nights
    Hilton/Marriott at hotel’s discretion, usually 2 pm, which they give to non elites as well. Anything else is an exception

    Upgrades:
    SPG: Upto Standard suite. Usually obtained with a bit of persuasion.
    Hyatt: Club rooms. If higher non suites available, with reminder about actual policy being best non suite, not club
    Hilton/Marriott: One “category” is standard (could even be high floor or club/executive, none of which are real upgrades if lounge access is assured anyway)

    If confirmed suites at booking is the goal, Hyatt is the best. If you want to see a ton of suites consistently for short stays, SPG is. Hilton/Marriott do not upgrade to suites with any sort of consistency. Individual member experiences not statistically significant. FT and MilePoint threads as a whole are.

    Breakfast:
    SPG and Hyatt are broadly similar. Both provide breakfast to 25 stay/50 nighters at all properties
    Hilton doesn’t provide breakfast officially at luxury (Waldorf) properties. They do however provide it for 20 stay/40 nighters.
    Marriott lags seriously (no bf at courtyard, resorts or luxury – Ritz)

    Lounge access:
    SPG and Hyatt provide it for sure to 25 stay/50 nighters at all properties
    Hilton provides it *maybe* if you’re upgraded to 20 stay/40 nighters. Confirmed at Diamond
    Marriott starts at 50 nights but excludes Ritz

    How anyone in their right mind can now deduce that Hyatt/SPG are less than excellent with on-property benefits is beyond me.
    Redemption side, SPG has its sweet spots and in those, they’re again the best (premium rooms, some low and mid category) and in rest, they’re worst (high end, some other mid category)

  66. My question, as new to the points game and living in Australia, how will we get our Amex points across to AA?

  67. We know that Marriott spun off their timeshare division while maintaining the franchise agreement with the business. In essence, Marriott Vacation Worldwide is a separate publicly traded company using “Marriott” name and paying Marriott a brand fee. Now, my question is about Starwood Vacation Ownership. Considering the fact that Marriott wanted to get rid of the capital intensive timeshare business, do you think they will do the same with Starwood; spinning off the timeshare division as a separate entity while managing it the way they did with MVW and made it a successful win win situation for both Marriott and the spun off division? Any thoughts? Thank you

  68. I have a feeling that, as the time goes by, they will gradually merge similarly like-minded brands.
    Thinking along the lines:
    – moxy might become aloft (moxy is not so widely spread as aloft)
    – Autograph Collection / The Luxury Collection (hard to say as to which will survive, both have about the same number of properties)
    – EDITION / W HOTELS (my bet is W will survive as more wide-spread brand)
    – Renaissance / Le Meridien OR Westin
    – Four Points / Courtyard (my bet on Courtyard brand surviving)

  69. Andy,
    when i said hhonors program was better, i meant that it has better earning to spend ratio.
    i can only speak for myself but as hhonors gold, i get roughly 20% back on $100 booking.
    (1000 base point + 1200 hilton amex spend + 1000 my way bonus + 500 amex online booking + 250 gold vip bonus) x .005 = $19.75

    but as spg gold, i get less than that.
    ( 200 base point + 100 gold bonus + 200 spg amex bonus + 250 welcome gift ) x .022 = $16.50
    sometimes, i only get 125 star points for welcome gift.

  70. SPG Gold (10 stay/25 nights) isn’t really the same tier as HHonors Gold (20 stay/40 nights). HHonors Gold requires closer to SPG Platinum level of stays.

    I’m not familiar with credit cards in US since most of the world has no access to them.
    Also the MyWay bonus should be 500 not 1000.

    So the total 1000+500+250 so 1750*0.005 = 8.75 and + 100*0.005 = 13.75

    As SPG Gold, you would get
    250 (welcome bonus at non aloft/4p) + 200 (base) +100 (gold) = 550*0.022 =12.1

    So pretty much a wash. I actually value Starpoint higher at 2.4c since I have the redemption sweet spots figured out and the transferability means a lot to me, so my analysis (above is with your values) actually has them higher than HHonors.

    I’m pretty open to the idea that SPG is all about sweet spots, some redemption area it has excelled and others its dead last in an effort to differentiate and appeal to a specific crowd rather than be a jack of all trades.

    Adding credit cards into it for US based guests. 1 starpoint @ 2.2-2.4 (consensus value) is 4-5x 1 HHonors point (0.5 consensus value). As you noted above, you’d then get 200 amex bonus for SPG and 1200 for HHonors, a factor of 6 difference, sweetening the deal a bit for Hilton.

    However SPG is all about getting to elite (that’s their sweet spot), their earning curve accelerates steeper than the rather flatter curve of Marriott/Hilton. Once the Platinum welcome bonus and the 4th point start to come into play, you’re earning doubles essentially.

    Hilton Base to Diamond goes from 10+5 to 10+10 (33% more)
    SPG base to Plat75 goes from 2 to 4 (100% more)

    There is however, the question of valuation of property benefits. At top tiers, both offer lounge access but only SPG offers you breakfast at resorts. Only SPG will do consistently 4 pm checkouts and the mother of them all, suite upgrades, which can be 200$ (face) value per night of stay, and perhaps a 50-100$ value to me.

  71. That should have been breakfast at top tier luxury properties (not resorts) since SPG offers breakfast everywhere whereas Hilton skips it for Waldorf.

  72. @Andy — You are “not even going to bother with DCS” because the truth hurts, but nor will DCS bother with you because SPG is so great it will be no more… 😉

    G’day!

  73. Marriott employee here — working at an extension of our corporate headquarters. As an insider, I can personally vouch for the fact that we are not a Mormon company. We’ve been publicly traded since 1953, and the majority of our stockholders (the literal owners of the company) are not Mormon. Our current CEO for the last several years, Arne Sorenson, is a Lutheran. As other folks have stated, we give *nothing* to anti-gay organizations or causes. On the contrary, we’ve been openly supporting equal rights for decades, and we literally put our money where our mouth is.

    Consider the following:
    1. We have a non-discrimination policy for our employees that covers not only sexual orientation, but also gender identity and expression.
    2. We’ve received a 90% to 100% rating on the HRC equality index every year since 2007.
    3. We have gay employees at all levels of management — including my own team lead, who brings his partner to all of our work functions. The only response he’s received from the company is, “bring your partner back! We like him!” By contrast, I’m not aware of a single Mormon who works in my office. And we’re reasonably high level in the organization, with cross-company worldwide access.

    If you seriously intend to boycott Marriott because you believe the false rumors that we’re owned by the Mormons and take direction from Salt Lake, that’s up to you. But you’ve got the wrong target. We’re the good guys.

  74. Quite annoyed at this. Namely as they (Starwood) sold off SVO a couple of months ago… To interval, which is not what we spent a fair amount of money on. I’m worried – SVO sent an email staying they will continue to honour the SPG links but I feel that this is worthless. Let’s wait and see

  75. I bought into the Westin Timeshare and I havre the opportunity to purchase 90,000 spg points fpr $1800. Is that a wise purchase considering the difference in the two programs points?

  76. We have been members of marriott timeshares and also starwood timeshares. Marriott is so bad. Every point is essentially worthless. Starwood points are much better. We wish we had never bought all those weeks at the marriott in Oahu.

    For example, staying at a miserable marriott in heathrow costs minimum 25,000 points. Staying at a much better and almost next door starwood property costs 7,000 during the weekend and maximum 12,000 during the week.
    Plus food at the marriott is nonexistent. No way to get upgrades like free internet or snacks like starwood.
    Marriott made money off our back. I hate marriott. They are so classless. Not my style. Too bad for us.

  77. Starwood adds enormous value to Marriott because SPG elite customers are some of the most lucrative in the hotel industry and because Starwood’s upscale/luxury portfolio is the best of all the major “points/status” hotel groups. SPG hotels tend to have the best customer loyalty of any of these major chains–with 50+% of customers being SPG members. Marriott looks to benefit from those customers.

    The combined hotel company is obviously going to have to integrate some of the SPG elite benefits into the combined loyalty program or risk losing many of those customers–especially since both Hyatt and Hilton have moved to match SPG Platinums to Hyatt and Hilton Diamond status to encourage those elite customers to switch. Marriott has less to worry about with Hilton…but it does have a threat for its SPG elite customers moving in droves to Hyatt. It can’t lose them all–since Hyatt doesn’t have enough presence to satisfy most SPG elites. But it can lose plenty. Whether or not that loss of some SPG elites is tenable for Marriott is something their bean-counters will soon ascertain.

    My guess is that Marriott Rewards will be a bit better than it is now…and worse than SPG.

    Marriott Rewards likely still will require at least 75 nights for Platinum status–especially since it will be so much easier to get those nights with the added 1100 SPG hotels. But it should add some SPG Plat benefits to its Marriott Plat benefits–learning something from SPG and giving SPG elites more reasons to stay. I wouldn’t be surprised to see Marriott retain something like SPG’s SNAs and suite upgrades for Platinums–since most of the hotels that they’re adding ALREADY do that with StR, Luxury Collection, W, Westin, Le Meridien, and Sheraton anyway! The only Marriott hotels that would have to comparably “add” that benefit are the JW Marriott, Marriott, Edition, and Renaissance hotels; SPG already has its new Design brand which doesn’t include that benefit, so it’s conceivable that Autograph, Bulgari, and Ritz Carlton could similarly be added or exempted as appropriate. Including that ONE Platinum benefit might be enough to hold onto a substantial number of SPG elites to Marriott-Starwood. If Sheratons, Westins, and Le Meridiens can upgrade to available suites/best rooms, there isn’t any reason that Marriotts, JW Marriott, and Renaissance hotels can’t do the same. If St. Regis, Luxury Collection, and W hotels can do that, there isn’t any reason that Ritz Carlton, Edition, and Autograph hotels can’t do the same, either. Maybe Marriott will learn something from SPG in that regard…and bring far more customers over.

    Better Marriott Platinum upgrade benefits for its greatly expanded luxury/upscale portfolio can also cannibalize high spend customers who otherwise might consider Four Seasons, Peninsula, Mandarin Oriental, Shangri-La, Banyan Tree, and even Oberoi and Aman. It certainly has done that for many SPG Plat elites–choosing StR, Luxury Collection, and W hotels over those other luxury alternatives because we often can get value-add with significant room and suite upgrades and other benefits. Marriott’s current model doesn’t encourage anyone to Ritz Carlton or Bulgari or Edition over those other luxury brands. Marriott might learn a thing or two from SPG in this regard.

    One can hope, at least.

  78. Having worked for Hilton and Marriott, I can tell you that it’s not going to be a fun ride for W and Aloft employees. The culture at Marriott is like cotton dockers and Joseph A, Banks…… old and stuffy. I predict that someone that understands these two brands and will acquire them from Marriott. Just doesn’t fit.

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