SPG Warns Members Who Make Speculative Bookings At New Hotels

A reader shared with me an interesting message he received from “SPG Member Account Integrity,” which I figured was worth passing on, since I’ve never heard of something like this before.

New hotels are notorious for having delayed openings

I don’t know how it’s possible that this is consistently the case, but hotels seem to almost never open on time. They’ll start selling rooms, and then they’ll reach out to those who are booked and inform them that they won’t be able to honor their reservations. Sometimes openings are delayed by weeks, sometimes by months, and sometimes by years.

I understand construction delays happen, but I’m surprised that hotels haven’t learned not to start selling rooms when these delays seem to happen almost every time, especially since many of these hotels are managed by international chains.

There are people out there who will speculatively book hotels right around when they’re scheduled to open, and then when the hotel can’t honor the reservation, they’ll request compensation. I think it’s reasonable to compensate guests in the case of a delayed opening when they had a genuine intent to actually stay at the hotel, and were planning a vacation around it. At the same time, for those who only book reservations with the intent of canceling, I have less sympathy, and I don’t blame the hotel groups for cracking down.

This brings me to the email a reader received.

Starwood warns member to stop booking new hotels

Here’s the email a reader shared with me (which seems to be generic, so presumably was sent to quite a few people):

Dear SPG® Member,

If you are receiving this message, access to your account has been temporarily disabled as your account appears to be included in one or more of the emerging trends described below:

Confirm reservations for grand opening dates at SPG® participating hotels with an invalid guarantee method

While we greatly appreciate genuine interest in experiencing any Marriott property, there have been reports of invalid guarantee methods being used for rooms reserved at hotels that have announced their grand opening date. This is of great concern to us and the hotels as some of these reservations are either canceled late or not at all leaving the hotels with no recourse for recovering the lost revenue as the reserved rooms sit empty on opening day. This message serves as a reminder that any reservation confirmed with a credit card that will not authorize the forfeiture amount is subject to cancelation at any time and without notice. Hotels have been advised to preauthorize the late cancel penalty amount as soon as the reservations show active in their systems and to cancel any booking where the credit card declines.

Request compensation for delayed hotel opening

While our hotels will absolutely consider compensating any guest for genuine inconveniences or issues they determine they are responsible for, a pattern is developing which increases our concern as to the authenticity of some of these reservations.

Please understand we have placed your account on an alert list and are monitoring all pre-opening reservations at SPG® participating hotels.

Please reply acknowledging receipt and your understanding of this message so that we may reactivate your account.

Sincerely,
SPG® Member Account Integrity

Did the reader do anything wrong?

The reader who reached out to me asked if I had ever heard of something like this before, or if he did something wrong. He was very forthcoming about his situation:

  • He has never used an invalid payment method for a booking (which frankly seems like an odd concern for Starwood to have)
  • He only received compensation for a hotel that didn’t open on-time once, and that was for 500 Starpoints (not exactly much of a bounty)
  • However, he does tend to book new hotels, and cancels reservations about 95% of the time
  • He actually paid a no show fee for a new hotel stay once, because he didn’t cancel in time

While it’s clear he didn’t have the intent of completing every stay, I also get the genuine feeling that he wasn’t trying to game the system for compensation. Rather it seems he was just enthusiastic about new hotels, and booked them as he saw they became available, and then later firmed up plans (which ended with him usually canceling).

He realizes he may have overdone it a bit, and will take it easier going forward.

My recent experience with a delayed hotel opening

While we’re on this topic, I wanted to share my own recent experience with a new hotel opening. For the record, I’ve never speculatively booked a hotel with the intent of trying to get any compensation out of the delayed opening. However, I did book Solaz, a Luxury Collection Hotel that’s supposed to open in Los Cabos on September 1. I booked it for opening day, and booked refundable award flights to go there.

I booked thinking it would make a fun getaway, and the timing worked for me. I have the intent of going, though at least I have flexibility, because it’s fully refundable. Starwood’s website continues to show a September 1 opening date, though they’re now only selling rooms as of September 16.

On May 10 I received the following email from Starwood Executive Customer Service:

Dear Mr./Ms. SCHLAPPIG,

As a valued Starwood Preferred Guest member, we are writing to inform you of a delay in the opening of the Solaz, a Luxury Collection Hotel, Los Cabos. Due to unforeseen circumstances the hotel is now expecting to open on September 1, 2018.

We see you are currently holding reservation XXXXXXXX, arriving on 9/1/2018 and departing on9/5/2018.  We will need to cancel this reservation in the coming days due to the delayed opening and wished to advise you that this update will be reflected online through your SPG membership once completed.

Our team at the Solaz is happy to recommend the below properties as relocation options for you during your travel to Mexico. They have worked locally to ensure the discounted rates highlighted below are made available to you upon your request.

  • JW Marriott, Los Cabos at a nightly rate of $199 USD (prior to taxes and associated fees)
  • Sheraton Grand, Los Cabos at a nightly rate of $159 USD, (prior to taxes and associated fees)

Alternatively, the Solaz team would be happy to modify your stay to an arrival after September 1, 2018.

We realize this may be disappointing but hope we can count on your understanding and apologize for this unforeseen delay. We look forward to welcoming you to a SPG property in the near future.

I’m surprised by the unprofessionalism:

  • Couldn’t they look at my SPG account to see if I’m a Mr. or Ms.?
  • They tell me the hotel opening is delayed until September 1, though that’s the date I’m booked for
  • A Sheraton Grand or JW Marriott really aren’t acceptable alternatives to a significantly nicer-looking Luxury Collection property, which is also priced twice as high

I responded to the email asking for clarification, given that I was booked on September 1, and they also claimed that was the new opening date.

They responded as follows:

Thank you for taking the time to reply to our email.

We have every reason to believe that the Solaz, a Luxury Collection Hotel, Los Cabos will open on September 1, 2018 as scheduled, however, we cannot guarantee that unforeseen issues may arise. Proactively we can book your reservation at one of the hotels nearby and when it gets closer to September 1 we can take another look at the hotels plan to open and cancel the alternate reservation, prior to the cancellation deadline, if it is no longer required. Please let us know if you wish to book an alternate stay.

Mr. Schlappig, thank you for being a dedicated SPG member. We appreciate your continued support of SPG and we look forward to assisting with your future travel needs.

Alrighty, so they are opening on September 1 it sounds like? Who knows…

Bottom line

I don’t blame Starwood for cracking down on people making speculative bookings in order to get compensation. It doesn’t sound to me like that was exactly what the reader who contacted me was trying to do, though. My guess is that they sent out this email based on a number of parameters, and one of those was having made X number of bookings at new hotels.

Has anyone received similar communication from Starwood, or another hotel brand?

Comments

  1. He has never used an invalid payment method for a booking (which frankly seems like an odd concern for Starwood to have)

    Why odd? The payment method you provide is your guarantee that the hotel can collect the no-show fee. If it’s uncollectible (through error or deliberate fraud) it effectively allows you to no-show without penalty.

    It would seem to be a reasonable practice for the hotel to place the no-show fee amount on hold at the time of booking.

  2. He cancels 95% of his reservations? I’m surprised they have not demanded a non-refundable booking fee of $100 for each future reservation. That’s just bizarre on his part and should have consequences. My 8-yo niece and 5-yo nephew have a better track record on deciding what they want for dinner.

  3. Why is this strange? As has been said, 95% cancellation rate is pretty ridiculous. I’m all for for taking advantage of the system (to an extent), but he literally cancels 19/20 bookings he makes.

    I think the email is awesome. He’s probably lucky they only gave him a warning.

  4. “At the same time, for those who only book reservations with the intent of canceling, I have less sympathy”

    Sure, I get your point and I kind of agree. On the other hand if there are a lot of these people maybe in the future hotels get more cautious announcing opening dates (just like EU261 is intended as a deterrent).

    On a side note, isn’t some of the shtick of the points bloggers also gaming the system 😉

  5. “Cancels reservations about 95% of the time”

    Lucky: “I also get the genuine feeling that he wasn’t trying to game the system for compensation”

    Are you serious Lucky? What a complete joke, of course he is trying to game the system. Can’t believe you’re trying to defend him. Now I understand why you were whingeing about hotels changing their cancellation policies, because you’re a serial offender yourself.

    As to SPG’s “unprofessionalism” when they send an email to you as “Mr/Ms”, get over yourself Lucky, the world doesn’t revovle around you…

  6. While cancelling that many reservations IS odd, I guess I feel like if you as a business offer higher prices for rates that are fully refundable, then the expectation is that someone may cancel them. Personally, I have made refundable/ cancellable bookings in the past if I think prices may come down, and then switch to a nonrefundable rate closer in. I suppose I’m not on anyone’s sh~tlist because I tend to stay at the same hotel I intended, just at a better rate. I even flew a refundable fare once because no award space opened up (at least that was good for extra miles).

    If SPG/Marriott is worried about refundable bookings made for grand openings, the easy solution is to only sell partially refundable rates on those nights.

  7. This is the new Starwood/Marriott/Starriott going forward IMHO
    Yes 95% percent cancellations is abusive and should be acted on
    However for folks who are wronged legitimately I expect the company
    do do little or nothing for them
    Marriott is not the former Starwood in any shape or form and had never been
    Underneath Marriott has always been all about the money only
    Customers can expect
    Crazy sky high pricing on revenue rooms in the future with tons of Bar prticing
    Limited award room availability
    Excessive devaluations in the program
    and the worst customer service in the history of the company/ program
    Added to that a massive decline in customer service across the board with the new Mexican Call centers where they know little and lack of empowerment to fix problems
    call hold times of 20 minutes to 2 hours as already experiences by many members
    calling the elite lines
    How did a a company like Marriott not prepare for this?
    They rushed to merge the programs and the call centers before they were ready and made sure to erode every day spending across the board on their credit card portfolio
    Welcome to the new Marriott Rewards like shooting fish in a barrel
    RIP to the former real Starwood 🙁

  8. I don’t buy for a minute that this guy isn’t trying to game the system or that he has only requested or received compensation once. I’m surprised you think his behavior is above reproach . I hope they do penalize him going forward.

  9. Seriously, just a warning for a 95% cancellation rate? He shouldn’t be complaining. Reminds me of a story I read about an Amazon customer who returned merchandise at about the same rate and got her account cancelled and then wanted sympathy and reinstatement.

    On a side note, I’ve been stranded a few times in locations where it’s really difficult to get rooms at good hotels. I was able to get a room for the same day and the desk clerks said that they always have at least 5% (very late but within the free cancellation time frame) cancellations and it usually ends up costing the hotel revenue.

  10. How many actual SPG nights does this person actually do? How often do they pull the 95% cancellations. For the red flags raised I don’t think monitoring is too severe a penalty.

    As to the unprofessionalism the Mr/Mrs is just too picky-picky. And I think working discounts with two local properties is more than most would do. Is this perhaps a case of DYKWIA? I can see the date issue. They would just give a warning that the date is on the bubble, rather than cancelling.

  11. As the “Reader” who submitted this post to OMAAT, I feel it’s worth pointing out that I don’t cancel 95% of all my reservations – just those made for new hotels. I stay an average of 75 nights per year at SPG hotels, and many of these are high revenue nights. My overall cancellation rate is probably more like 40%.

    The reason for my reservations – not that I would recommend anyone else copies me after my experience! – is that hotels often offer really attractive rates when they are preopening. If I were gaming the system, I would have a small fortune in “goodwill” payments (I don’t), received countless free nights (I haven’t), and I certainly wouldn’t have voluntarily paid no-show charges (I have).

    The part of the email which I thought was really quite rich was the (almost) guilt trip on hotels having rooms which sit empty on opening day. Maybe if hotels want to have 100% occupancy on opening day, they should guarantee their opening dates rather than setting them speculatively. I have attended a significant number of openings and the vast majority have been deserted – as in, I was one of three or four visible guests in a hotel with several hundred rooms. Somehow, I find it hard to believe that the hotel was at 5% occupancy due to speculative bookings and cancellations with false payment details.

    Now you may or may not believe me – but SPG have this information in their purview and could easily have checked before taking the drastic step of deactivating my (and presumably many others’) accounts. Bearing in mind people have been encouraged to book hotels speculatively pending the category changes, I thought others would like to know that SPG are clamping down on this. Needless to say, I will be moderating my behaviour going forward, if my account is reactivated (and completely accept that I am not without guilt in booking hotels indiscriminately). Though frankly, account reactivation doesn’t seem like a sure thing based on their unresponsiveness.

  12. Dude, the first e-mail might have been a fluke but the second one explains the intent pretty clearly… They say they are proactively setting up other arrangements for you so in the event the hotel doesn’t open on September 1st you have other arrangements already set up. I get that your circumstances as a blogger are different and you want to review new hotels, but for a traditional vacationer which Starwood assumes you are (they cannot know the backgrounds of every single person that books their hotels) that is more than enough. So yes, to answer that question the hotel is opening on the 1st but in the case it doesn’t, everyone booked will have other plans set up already.

    The increasing attitude over things that are not worthy of snark is becoming off-putting as a reader.

  13. “cancels reservations about 95% of the time”

    That alone should have set off some red flags…

  14. No different than when the W St. Petersburg deflagged and they took two months after notifying me to rebook at a distant Courtyard. I declined.

  15. Unfortunately travel blogging is driving some unsavoury practices. There is obviously a big market advantage in being one of the first to review a new hotel or flight so a lot of bloggers will be booking hotels just after they open. Closer to the time, they necessarily then prune down to an itinerary which works for some the ones which do open on time.

    I am not saying it is “right” but I do think there might be an innocent explanation.

  16. The reason hotels never open on time is sometimes, they wait till the bookings pick up to a level that justifies a full opening. Basically if I announced a 1 June opening but through July 15, I only get bookings that would result in 12% occupancy, its cheaper to rebook these guests to a nearby property than to commence full operations with the associated variable costs.

    Basically they cancel confirmed reservations and evict guests because….money.

    That’s one reason. Another factor at play is owner-management conflict of interest and they both pull in opposite directions so to placate the owner unrealistic deadlines are promised. Yet another reason is government. No one in any country can really rely on government to provide approvals in time and unforeseen things crop up in complex projects. But mostly reason number 1 since the other ones can be accounted for by not announcing an opening until 100% ready.

  17. Amazon is scam. A lot of the stuff they sell doesn’t meet the standard it says it should in the review.

    Essentially they have outsourced the QA to the crowd and act surprised when they have high return rates? Any Tom dick and harry sells whatever they want on Amazon.

    Also how do two gays decide which one will be the Mrs. How is Starwood to know? Tell them that s/o is the mrs.

  18. Come on Debit, asking a gay couple who of the two is the female is like asking two chopsticks which one of them is the fork and which the knife.
    I really thought you had improved recently, but I guess I was a bit mistaken.

  19. @”Reader” : You still aren’t explaining why you cancel 95% of new hotel bookings, yet Lucky claims you are not gaming but “just enthusiastic” about “new hotels”… enthusiastic about booking or actually staying?? I have had a hard time finding cheap rates at new hotels, rather I see the opposite: they don’t have my corporate rate loaded or are not set up for award stays yet.

  20. @Dmodemd, in truth I didn’t have a good reason. I just thought there was no opportunity cost to booking any hotel and cancelling. I could easily have been more selective, and only chosen places I thought I might go to (rather than properties it was more likely I wouldn’t go to!).

    As for the rates, it’s not always guaranteed to be cheaper (hence why I never book prepaid rates) but there is often a huge price variance before hotels open compared with after they open. It was after I got burned a few times with hotels getting more expensive that I became obsessed with locking in speculative reservations where there was no “cost” to me. Clearly I was wrong!

  21. Unless he made a mistake when entering his cc info, the reservation was made with an invalid card. That doesn’t mean he intended on gaming the system, more like he always assumed he wouldn’t be following through on most of his reservations and obviously didn’t want to be stuck with any charges. I can see using an invalid card when reserving at a shady Best Western or hole in the wall establishment that might charge you ahead of time even when payment isn’t due until check in, but that shouldn’t be necessary with Starwood or any other chain with decent customer service.

  22. @”Reader” I think you learned your “lesson” about the unusual practice of making so many speculative bookings at new hotels. I’m not sure there is anything else to be gained here by continuing to engage anyone here about that topic. Thank you for your data point, at least now others will know not to follow in your footsteps. One question I do have for you though is, in your experience, have the service levels at these newly-opened hotels generally been less than an equivalent long-established hotel?

    @George get out of here with your bigotry. Completely unwarranted comment and you should be ashamed.

  23. That JW in Cabo does look nice from what I’ve seen. That would be a nice review. Let us know whether it’s worth it or not!

  24. @Reader and Lucky…TPG just ripped off this whole story with a shitty cut-and-paste job and a weak “hat tip” at the end. Considering what went into writing and researching this article, this feels egregious.

  25. Slightly OT but the chains are PATHETIC when it comes to providing updates about opening dates. The worst at the moment is STarwood and the new Sheraton in Colombo ( Hyatt just as bad, in fact, same city). The dates keep drifting but rarely updated on the site and NEVER any news about the project.
    I’m only interested in new hotels in places where there isn’t a decent points option: Colombo is a good example ( nothing great near the airport , resorts too far for a short stay, no major chains in town other than Hilton).
    There is a desperate shortage of rooms and yet this thing has taken 5 years to build…and still far from finished.

  26. He’s both a frequent customer and a gamer. Nothing contradictory about that; in fact, being a frequent customer helps his knowledge base as a gamer. He got caught. No excuses needed and no sympathy here. It’s people who overdo the speculative reservations that nudge hotels toward nonrefundable rates, earlier cancellation deadlines and the like.

  27. Thank you Lucky for this post and you blog generally which keeps us updated on interesting developments in the points/miles world.

    On the Mr/Mrs. thing, I’m really surprised to see you complain about that, because as someone who I thought was “woke,” I assumed you were aware that we are moving toward a gender neutral dystopian world where people now write “they” as a singular instead of using “offensive” pronouns like “he and “she,” they say “Latinx” instead of Latino/Latina, etc. How dare a hotel presume that a one time “Mister” guest has not transitioned to female to since his last stay. Perhaps instead of “Mr/Mrs” they should have just used the new non-offensive title “Mx” (I just looked that one up, it’s a thing).

    Anyway, back to the cancellations. I’d like to hear from “Reader” about how many new hotels he booked at and why. Did he book 20 new hotels and cancel 19, or did he book 100 new hotels, all over the world, and cancel 95 of them. Not just the percentage, but the number of bookings. He says above “I could easily have been more selective, and only chosen places I thought I might go to” so I’m struggling with how there was good faith here. Was he just bored and gets a kick out of booking and canceling hotels? Because if he says he had no reason at all to make these bookings, and SPG says that they have a pattern of people making new hotel bookings and demanding compensation, I have to side with SPG in presuming that’s what he was attempting.

    This raises a broader question for the rest of us though. Do hotels monitor accounts generally for speculative bookings and are others punished for canceling too often or too late? I make a lot of speculative bookings myself. I always have the good faith intent that I might stay there, but I tend to fiddle with plans and change dates around, and very often I’ll book a hotel as a “placeholder” like “let me just lock down a reservation at this Hilton in the area, it looks OK, then I’ll properly research hotels later and see if I can find a better deal.” Or, “I think I’ll be in Los Angeles for a few days somewhere between December 1-7, let me book six consecutive one night reservations at this hotel, and then as we get closer I’ll cancel some or all of the nights.” Or, “I’ll be in London from May 22-24, I haven’t yet researched exactly what I want to do or where I want to stay, I’m going to book two hotels now just to get them on hold (sometimes with the same chain) and then I’ll cancel one later, when I firm up my plans about what part of town to stay in, or when I see what promotions are on offer (Accelerate, triple points, etc.)

    I try to be courteous and not wait until right before the cancellation deadline before cancelling, but I do book a lot of hotels speculatively and then cancel. I’d be really curious to know if hotel chains monitor this generally, do we all have a speculation score attached to our accounts, is there a certain rate of cancelling that puts us in jeopardy of closure just from speculating, etc.

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