Yesterday, Marriott announced its acquisition of Starwood Hotels and Resorts. The transaction is expected to close “mid 2016”, but we have no information yet about how or when the loyalty programs will merge. My guess is that the loyalty programs will merge early 2017 and that Marriott Rewards will be the surviving program over Starwood Preferred Guest (SPG). Assuming this is true, there will be a huge number of pissed off SPG loyalists. SPG has long been hailed as one of the best hotel loyalty programs, yet it appears that it’s end is in sight.
How to keep SPG loyalists loyal
Assuming that Marriott combines the two loyalty programs into Marriott Rewards, I’ve made a list of things Marriott should (but probably won’t) do to keep SPG members loyal:
1. Convert SPG points to Marriott Rewards points 1 to 4
Stays at most Marriott hotels result in 10 points per dollar earned by basic members. Stays at SPG properties result in 2 points per dollar earned. If a person chose to spend $5,000 at SPG properties, they would have earned 10,000 points. If a person chose to spend $5,000 at most Marriott properties, they would have earned 50,000 points. To keep SPG members “whole”, Marriott should convert SPG points to Marriott at a 1 to 5 ratio. It’s true, though, that Residence Inn and Town Place Suites Marriott’s offer only 5 points per dollar. So, discount the point earnings a bit and offer a 1 to 4 ratio. For example, 10,000 SPG points should convert to 40,000 Marriott points.
2. Match Gold to Gold, Platinum to Platinum, and SPG Platinum 75 to Marriott Platinum Premier
Marriott and SPG currently have different elite status requirements. Here are Marriott’s requirements:
- Marriott Silver: 10 qualifying nights per year
- Marriott Gold: 50 qualifying nights per year
- Marriott Platinum: 75 qualifying nights per year
- Marriott Platinum Premier: This is an unpublished level probably requiring 150 or so nights per year
And, here are the SPG requirements:
- SPG Gold: 10 stays or 25 nights
- SPG Platinum: 25 stays or 50 nights
- SPG Platinum 50: 50 nights lets you choose an additional benefit (such as 10 suite night awards)
- SPG Platinum 75: 75 nights gives you increased SPG point earnings, and the ability to choose your check-in time (example, check in at 9pm, check out at 9pm next day)
- SPG Platinum 100: 100 nights gives you SPG Ambassador service
If you were to just match up the basic requirements, you might match SPG Platinum to Marriott Gold since both require 50 nights. The problem with that approach is that it is unfair to SPG elites. Marriott nights are much easier to achieve given the much larger global footprint that Marriott has. Plus, the Marriott credit card gives members 15 elite nights automatically. That’s three times as many as the SPG credit card which gives members only 5 elite nights.
To keep SPG elites loyal, Marriott should match them to the higher tier.
3. Convert lifetime elite nights 1 to 2, and lifetime points 1 to 4
- Lifetime Silver Elite: 250 nights and 1.2 million points
- Lifetime Gold Elite: 500 nights and 1.6 million points
- Lifetime Platinum Elite: 750 nights and 2 million points
SPG lifetime nights earned should be doubled when the programs merge. And, for calculating points earned, SPG points should be quadrupled (or even quintupled).
4. Extend free breakfast benefit to all properties (especially resorts)
Marriott has a nice perk for Gold and Platinum elites: guaranteed lounge access / free breakfast. The idea is that you and a guest can get free breakfast in the hotel lounge. Or, if there is no lounge, or it’s closed, then you get free breakfast in the hotel restaurant (continental breakfast only, in the US and Canada).
Unfortunately, Marriott excludes resorts, Courtyard hotels, and AC hotels from this benefit. SPG provides club lounge access to Platinum elites at all properties and offers continental breakfast as an optional welcome gift. If Marriott were to extend the lounge / breakfast benefit to all properties they would meet and even slightly exceed the current SPG benefit.
5. Add suite upgrades as a Platinum benefit
Currently, Marriott doesn’t offer any option for high level elites to get suite upgrades. SPG currently offers 10 suite night awards as a Choice Benefit for those who complete 50 eligible nights. Plus, SPG Platinum members can be upgraded to a suite at check-in if a standard suite is available. The SPG Platinum room upgrade benefit explicitly states: “An upgrade to best available room at check-in — including a Standard Suite.”
Marriott should adopt SPG’s suite upgrade options for their Platinum elites. Or, even better, adopt Hyatt’s policy and give high level elites 4 suite upgrade certificates per year so that suite upgrades can be confirmed at booking.
6. Enforce a real “no blackout date” policy
SPG has a great “no blackout date” policy for free night awards. Basically, if a standard room (defined by the hotel) is available, then you can book it with points. Marriott, on the other hand, says that they have a “no blackout date” policy, but it doesn’t mean much. They state:
With our “No Blackout Dates” policy, hotels will no longer have blackout dates for redemptions. Hotels may limit the number of standard rooms available for redemption on a limited number of days.
So, a Marriott hotel can’t blackout a date, but they can limit the number of rooms available for redemption. In other words, individual hotels can implement blackout dates (by limiting the number of rooms available for redemption), but they can’t call them blackout dates.
My recommendation is to adopt SPG’s policy and enforce it worldwide.
7. Increase the Marriott credit card earning rate
We’ve already covered the fact that SPG points are worth 4 to 5 times Marriott points. We’d like to see this reflected in credit card rewards as well. Currently, a person can choose to earn one SPG point per dollar for everyday spend with the SPG card, or one point per dollar for everyday spend with the Marriott Rewards Premier card. Yes, I know that the Marriott card offers 2 points per dollar for airfare, car rentals, and restaurants, but that’s not enough. Not even close. The SPG card offers far superior value. I’d recommend moving the Marriott Rewards Premier card to 3 points per dollar for all spend, along with additional bonuses for whatever categories make sense.
Of course, there’s another good option besides following the advice suggested above. Assuming Marriott doesn’t want to go forward with two different programs, they could adopt the SPG program and migrate Marriott Rewards members to SPG. That’s an even better plan!