Starwood Preferred Guest hotels sold to Marriott a couple of years ago. Now, following the first full year of their combined loyalty program, it’s clearer than ever – SPG should have taken Hyatt’s acquisition offer.
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SPG Was Openly For Sale
Starwood was struggling for some time. The Sheraton line is dated and needs a refresh, that weighed down the chain at close to half of the total property portfolio excluding Sheraton Four Points, the brand’s select service down line. They needed investments and sought mergers or acquisitions.
A number of suitors looked into the deal including IHG, Hyatt, Marriott and a Chinese Insurance/Investment firm. Their troubles were not down to the loyalty program, despite its generosity. The chain was larger in number of hotels than Hyatt but was otherwise much smaller than the Marriott, IHG and Hilton.
Hyatt Reportedly Had The Highest Offer
While not all of the details were leaked, one was, and Hyatt had a higher offer than any of the other chains. Matthew and I argued about it years ago when I was merely in my infancy as a blogger (though commenters suggest that’s still the case every week.)
Hyatt has a complicated share structure that preserves the original owner (the Pritzker family of Chicago) with special voting rights that SPG had a hard time swallowing. In the end, SPG turned down more money due to these voting rights and took the deal from Marriott for less money.
Marriott “Bonvoyed” a Great Program
SPG was notoriously generous with their elite guests. SPG properties would give the best available suite at checkin to top tier Platinums. That’s not a suite, a junior suite, or a room with a water view – that’s the presidential suite if it’s open. Platinums enjoyed free breakfast across the board, and they aimed to please.
Marriott has Bonvoyed the transition to a combined loyalty program. The chain has made benefits confusing and had trouble enforcing them. Bonvoy has made it nearly impossible to qualify for Platinum’s equivalent status level at just SPG hotels for those who wanted to stay with the brand by increasing them up to 240%. Promotions that were at least competitive in the industry have fallen off completely.
Marriott recently rewarded some elites for their patronage with 30-100 points just for having status. That’s terribly insulting. At a value of about $.004/point, that’s like sending customers who have spent 75 nights with the brand (at minimum $7500) a check for $.12 to thank them for their loyalty. No thanks.
Marriott either has no idea what their customers want or simply don’t care.
The Hyatt Merger Still Makes More Sense
Hyatt and SPG were just a better fit. Marriott already had so many brands, but Hyatt and SPG’s brands were more conducive to rebranding. Some Aloft hotels may have stayed as they were, others might have moved to a Hyatt Place brand. The Sheraton Four Points would have been the same. Andaz and W hotels have a similar concept, as do Westin and Hyatt Regency or St. Regis and Park Hyatt.
Both chains have select service options and business hotels but Hyatt and SPG are top-heavy with more premium and luxury properties than Marriott. Most importantly to travellers, their programs had a similar ethos. Hyatt and SPG not only gave confirmable suite night upgrades to their top elites but they were easy to come by, something Bonvoy has on paper but rarely delivers.
The two just seemed more aligned than Marriott and SPG.
Conclusion
After a full year of Bonvoy, the voices that are still displeased with Bonvoy tend to come from those who were SPG members and loyal to the brand. They want to be loyal to the hotels they love but those hotels are no longer loyal to them. Lifelong Marriott members don’t see Bonvoy for the failure it is because they never had SPG and then lost it. My DeLorean is broken (they all are in fairness) and I can’t go back in time, but I bet both shareholders and certainly SPG loyalty members wish they could to talk some sense into SPG management for taking the Marriott deal.
What do you think? Is Hyatt a better fit for SPG than Marriott? Do you disagree?
Like the beautiful woman who chose the guy with money instead of the guy who was nicer.
The woman seems to be happy but all her exs still seem pissed. She should have married the other guy.
I fully agree with Kyle Stewart, I as a SPG Elite feel literally INSULTED at Marriott-Bonvoy . As You guessed rightly Kyle, Marriott just don’t care for those who have migrated from SPG Elite to Bonvoy. It is actually downgrading of Elite. I have been making this point upfront with all the Marriott since this merger happened.
Biggest shock was hacking of total guest’s sensitive personal data , it was in my view due to sheer mismanagement of Marriott and Just don’t care attitude.
I am hopeful that Marriott takes due cognizance of its Loyal customer’s feedback and views.
Sad that SPG is gone, but I’ve moved on to Hyatt and at least have captured a bit of that SPG magic in great on-property treatment and an awesome top tier. Marriott is clueless and is highly regressive and opaque in spirit.
(BTW it’s DeLorean)
Yes, just got don’t staying in a Marriott, its OK, but nowhere as good as SPG once I use the last of my points that transferred from the SPG merge I’ll be unlikely to book any Marriott’s, Hilton Diamond is better and will start working on Hyatt.
Bonvoy was bad I agree. And I would have loved to see a Hyatt SPG merger instead.
But just take a look at the Fairmont/Raffles/Swisshotel merger with Accor.
This was several times as worse for all the ex-Fairmont members than what the SPG ones had to endure. It went from email support answer within a few hours to within a few months. Confirmed suite and room upgrade got matched with a status whose biggest benefit is “a welcome drink”. And as an ex-FPC member I still feel extremely insulted, especially by them constantly telling me how far better off I am now.
But at least I was now able to check out new hotels and brands.
Moral of the story: It could always be worse, but that doesn’t make one feel any better about it.
Yep! When I am done with my Bonvoy points, I will cancel my Bonvoy Brilliant card and apply for Hilton Amex. Last August, I stayed at Four Points by Sheraton in Milan, which was just renovated by Marriott, and hated it. The shower tub was too small, airplane” lavatory was bigger than that. For me, it was really hard to take a shower and didn’t hit the surrounding walls in that tiny shower tub. And I am not a big guy. No wonder they had an emergency string dropping down in the shower tub.
As a long time SPG platinum member, I was happier premerger.
The only way I now get recognized as a titanium is with point multipliers. Otherwise the property experience is downgraded. Suite upgrades are a thing of the past. I have not had a suite upgrade in the last two years since the merger. It’s okay in general but I liked the old SPG experience more
+1
Jetblue and Virgin were a better match, and didn’t happen.
I was well on my way to lifetime Platinum with Starwood, splitting my 60 stays a year with Hyatt to be also be a diamond. Now Hyatt gets all of of my stays with better benefits as a Globalist. I’m done with Marriott.
I used to LOVE SPG and give them all my hotel nights (100+ per year). But I switched over to Hyatt and never looked back. The Hyatt Globalist program is simply the best on the market when you factor in all aspects of the loyalty program.
I’m sticking with Hyatt as long as they don’t dilute the program. They already watered down a bit but still not too bad.
@Chris : regarldess who bundled for what and hosting whom, i agree that having absolutely zero presence in Israel is completely shooting themselves in the foot, being that it’s one of the most vibrant tech hubs on that side of the Atlantic.
@Mike Saint : i totally love how you totally shoot yourself in the foot by letting the hotel chain pick where you’re allowed to vacation instead of the other way around.
I think that you meant DeLorean with your vehicle reference above.
Well written article and thanks for the backstory.
As a Lifetime Titanium with Marriott, mostly Marriott, I was starting to diversify to SPG properties approaching the merger. While Marriott was decent, SPG definitely treated their frequent guests as rock stars, and I always respected/appreciated that.
Now with the Bonvoy changes in place, etc, etc, the status doesn’t really get me any differentiation . (the ‘hospitality’ is lacking). I’m a 150 night per year traveler, directing close to 1,000 nights for colleagues and project team members with whom I travel. Not too long ago, I would go to Marriott.com and never look elsewhere. Today, I start at Expedia, and if the Marriott properties are competitive, then I choose when to book them. Right now, SWA is offering great bonus’ for hotels booked through their portal. I’ve started to book via Airbnb and found some great local properties where we negotiate directly for long term projects.
It’s interesting how these changes affect behavior, but only Marriott knows whether the changes are truly affecting their bottom line.
Kyle,
I’m sorry, but this is a pretty uninformed post. The Marriott/Starwood merger was mostly a stock merger – Starwood shareholders received Marriott stock. Take a look at how Marriott’s stock has performed since the merger. Starwood shareholders made out fantastically well with Marriott – they made the obvious and correct choice.
Marriott is starting to see some better RevPAR growth as some of the complaints from SPG elites subside and as newer customers join the loyalty program. Hilton also gained some share this year. In contrast Hyatt hasn’t really seen market share gains despite all of the noise from the blogosphere.
RevPAR growth in Q3 for Marriott – comparable systemwide constant dollar RevPAR rose 1.5 percent worldwide, 1.9 percent outside North America and 1.3 percent in North America.
That’s less than the rate of inflation (not to mention less than that of competitors).
In reality, Marriott is just scuffling along at the moment.
UA-NYC,
Marriott’s main competitors are Hyatt and Hilton. Hilton’s RevPAR increased 0.4% in 3Q19; Hyatt was flat. So Marriott outperformed in 3Q (which is better than they were doing late last year, when they were trailing).
Thank you, Hotel Analyst, for putting the Marriott acquisition and success into proper perspective for those who simply don’t want to hear anything but their preferred narrative.
This article is nothing more than clickbait to assuage the bitter people who stay at cheaper SPG and Marriott properties and/or who can’t afford the $20K spending threshold for the Bonvoy Ambassador status.
Hyatt is a nice program…with very little reach for most. So it offers plenty of benefits, n0ne of which matter much when you can’t find a Hyatt affiliated hotel where you want one or that’s remotely as good as that available in the massive Bonvoy portfolio.
@Bill – This is the opinion of a business traveller and travel blogger and you’re welcome to disagree with my view of the world. However, there’s a bit of misinformation in your response and it appears you have your own preferred narrative.
For the avoidance of doubt, this year I logged 188 elite nights at a number of chains in addition to another 9 nights in Airbnb. I would have easily cleared the Ambassador level if I found any value in it. But why would I? I have a personal concierge at Hyatt that exceeds my expectations at 55 nights, why would I spend nights in Fairfields and Courtyards for twice as long to get the same perk? Hyatt and Hilton deliver, Bonvoy does not.
You also mention staying at cheap SPG hotels? Really? What gave you that impression? Was it my review of the Park Hyatt Paris-Vendome or the gaudy Ritz-Carlton Pudong?
I have long complained about Hyatt’s footprint, but they have an awful lot of quality over quantity. With SPG, they would have had a much better reach and the lower end SPG properties would have given some breadth to the chain.
In the end, both brands understood luxury, which makes the Marriott merger for less money so perplexing.
and once again, the gate agent who makes like $40k a year and flies non-rev parrots talking points on Flyertalk and pretends he actually understands a hotel franchisee’s income statement and balance sheet by jargon dropping “RevPAR”.
you can IMMEDIATELY tell he doesn’t work and doesn’t qualify in finance cuz he cherry picks single year single quarter single metric, claiming it’s lower than competitors and somehow doesn’t show the those glorious growth numbers that Hyatt has.
so it’s not surprise you must’ve been part of that gang that was touting Anbang Insurance and their counter bid “consortium”. Great foresight…. seeing now that Anbang’s chairman and CEO is prison for 18 years. Lovely to see people hate corporations so much they cheer for the guy who got sentenced to 18 years on charges of fraud and embezzlement.
Ladies and Gentlemen, presenting Henry LAX, the eternal 120 pound weakling pounding away at his keyboard in endless frustration!
(Get a life, troll).
I agree with you, Kyle makes no argument whatsoever why SPG should have chosen Hyatt. Wishes and desires for a better loyalty program didn’t play into SPG’s decision just as we don’t consider the right option when we sell a car…it’s all about the money. While Hyatt’s offer may have been more money it was convoluted and complex. SPG’s shareholders needed an immediate payoff vs a deferred one.
Everyone is quick to jump on Marriott for gutting SPG, but it’s probably safe to assume that any other hotel chain that bought them would have done the same. Buying a competitor with a more generous offering and bringing that offering down to your level is not a new practice and this isn’t the last time it’ll happen in the travel industry.
Mark,
It all depends on what you mean by generous. Starwood trailed Marriott and Hilton in delivering cash paying guests to hotels (which are the real customers here), which is why Starwood trailed Hilton and Marriott in hotel development (particularly in the US) leading up to the merger. So really, Hilton and Marriott were “more generous” than Starwood.
Not so with a hypothetical Starwood/Hyatt tie-up – they would have still been much smaller than Marriott/IHG/Hilton (<2,000 hotels vs. more than 2x for the others) and would likely have to continue to "try harder" (a la Avis) with respect to loyalty benefits
In isolation, sure, you could make a strong argument that Hyatt has the best elite program and that it’s significantly stronger than Marriott’s combined program. However Hyatt’s program is so strong precisely because it’s footprint is significantly smaller than competitors so they have to try harder to convince others to go out of their way to stay there. Had Hyatt bought Starwood, I don’t believe you would see outsized elite benefits. There would be some regression to the mean. I understand their combined size would still be smaller than the other chains but it would be much easier to stay in their hotels.
Besides, if the chains were so similar, what would be the real value to Hyatt? People made fun of the many duplicative brands with the Marriott merger but it would be even worse with Hyatt.
I think there would have been more integrations with St. Regis properties converting to Parks, and Andaz switching to W branding.
The benefit was a quick way to triple the footprint of the chain (they had 700 at the time and SPG had 1300.) That would have also made them a much larger competitor against then 5k Marriott, IHG and Hilton.
@Kyle Stewart : “I think there would have been more integrations with St. Regis properties converting to Parks, and Andaz switching to W branding. ”
If anything, it’s W’s getting refreshed as an Andaz not the other way around. Andaz is far trendier of a brand than W these days. Sorenson has been public about the needs to revitalize the W and Sheraton brands.
As for St Regis becoming Parks, they actually would love to keep both. Most contracts with property owners have non-self-cannibalizing clauses that restrict or forbid the parent franchisee from developing another property of the same branding flag within a negotiated area. Multiple luxury flags under the chain is the easiest way to circumvent that contractual obligation.
And I’m still confused about the central argument you made. If I’m understanding your point, it was that when Hyatt tells SPG board about their holding structure continues giving its largest owner disproportionately outsized voting rights and can do whatever he pleases and SPG is supposed to just “suck it up” and “deal with it” ?
And the entire premise of Hyatt having a higher offer was based on the same online rumors flying around ? If Hyatt actually *did* have the highest offer on the table in the end after Anbang abruptly backed out and SPG turned it down, shareholders actually have legal rights to sue the board for fiduciary negligence.
Well, was such a case filed and actually went to class action status and went to trial ?
Your other argument was that the merged entity, despite being 3x larger than Hyatt, would actually maintain or even expand their elite benefits.
How many major cases of corporate mergers in recent years in the large cap space you can list or count that actually benefited customers instead of
instead of merged for the sole benefit of shareholders and the company itself ?
*Marriott hotels in Israel= 6. Hyatt hotels in Israel = 0.
*Hyatt Regency Chicago hosts the annual Muslims in America for palestine hate fest;
*The Pritzker family were huge bundlers for Obama and his Globalist agenda; Penny Pritzker was awarded Sec of Commerce.
As long as the Pritzkers and Hyatt refuse to have a presence Israel, and, support radicals using the Hyatt Regency near their HQ, I’ll stick with Marriott.
Thanks! I didn’t know this.
Now all my business goes to Hyatt, none to Marriott. 😀
Why does Marriott think that everyone needs a bible from the Mormons ?
I think you are underestimating the importance of a broad footprint for a lot of travelers. When I travel for work, I want a hotel close to my first meeting. I also need a lot of hotel choices in domestic markets that aren’t huge cities. For example I’ve made some hotel stays in the Hudson Valley this year. In these kinds of places, there are plenty of Courtyards, Residence Inns, Hamptons, Hilton Garden Inns, but few Hyatt Places. Hyatt is expanding but will take years to get there. If I can’t stay where I want with Hyatt, I will stick with Marriott and Hilton. I’ve stayed with Marriott more this year because they are everywhere I need to be, and Starwood helped with that. Hilton is good too. And I can always redeem UR for Hyatt.
Marriott Bonvoy, like one or two other programmes has a clear message:
Give us your business and we’ll give you f*ck all in return.
I was loyal to SPG and although dated always liked Sheratons – maybe something to do with my age! However I’m now finding my home in other places.
First, it’s nonsense to suggest that SPG hotels even remotely often upgraded Platinums to Presidential Suites. SPG hotels upgraded to a comparable select/standard suite pool in pretty much the same way that Marriott Bonvoy properties do now. This article is laughingly looking back at SPG through rose colored glasses. It’s nonsense.
The biggest difference for Bonvoy upgrades comes from the legacy Marriott property brands that typically have many fewer if any suites compared to the comparable legacy SPG brands. Marriott’s portfolio was high on select service, extended stay, and solid but unremarkable premium brands that most often don’t have a large number of proportion of suites. SPG’s portfolio was high on luxury and upper upscale premium brands that most often have larger numbers and larger proportions of suites.
Marriott Bonvoy is upgrading its best elites–Titaniums and Ambassadors–easily as well and as often as SPG ever did for the same customers who stayed with the brands that had more suites. SPG elites who stayed at select service properties and mediocre suburban premium brand properties used to whine all the time that they didn’t get the same upgrade benefits as those who stayed at nicer properties with more suites. Nothing has changed now that Bonvoy has even more customers who frequent those same select service and mediocre suburban premium brand properties. The same people who whined with SPG are now joined by even more people who never even hoped for such suite upgrades with Marriott—and they never learn.
20+ years Legacy and LT from SPG. (Averaged 50% details on SNAs from SPG.) Stuck it out with MB as LT Titanium.
SNAs requested for 2019: 5 denials, 1 approval
All five denials from Westins in Asia and a Lux Collection in Middle East. One approval from JW in Asia. Received a comp suite from another JW without requesting a SNA.
SNAs are nothing more than increased chances to get a suite upgrade; they are not guarantees for a suite upgrade. If you choose a hotel that is fully occupied or close, you have little to no chance for an upgrade–understandably. That isn’t a weakness in the SNA or complimentary upgrade process or any issue with Bonvoy. If you choose a hotel that has few suites in the first place, you have to no chance for an upgrade–understandably. That isn’t a weakness in the SNA or complimentary upgrade process or any issue with Bonvoy. ALSO, there were just as many legacy SPG elites whining about their lack of upgrades with SNAs LONGE BEFORE Marriott came a calling, the first hint that this isn’t a Marriott issue.
People wanted to blame SPG when they didn’t get their SNAs to clear to suites…because no one wants to take responsibility for their own choice (or unfortunate inevitability) to stay at hotels with high occupancy or to stay at hotels with few suites in the first place. Nothing has changed.
Many to most hotels with these complaints now also have dozens of Ambassador and Titaniums in house at the same time, too–something most elites want to ignore or pretend isn’t true.
Again, you are only entitled to a suite upgrade from a pool of rooms and suites that MAY or MAY NOT be available. You aren’t entitled to get an upgrade to all suites at any hotel. You aren’t entitled to a suite if the hotel is sold out. You aren’t entitled to a suite if other elites may have selected the SNA options before you–since the time we select them likely has an impact on who gets the,. You aren’t necessarily entitled to a suite if other Ambassador guests have applied them against you–since Ambassadors outrank you. The reasons you may not have received a suite are obvious and understandable and quite reasonable.
Entitlement is the obvious issue with too many elites who simply don’t know any better.
Bill, you lost any remaining credibility when you invited an official Marriott representative into your VERIFIED private FB Ambassador group..sorry bro.
@UA-NYC, +100
I’m on my 3rd Ambassador this year. Current one has answered back four times with bad/wrong answers. I think I’m training him. He made a a mistake on my last SNAs. Maybe I’ll get my 4th this year.
I never mentioned entitlement or expectations. My point is Legacy luxury Marriott hotels have been better with suites/upgrades than SPG luxury hotels. Also with upgrades on arrival.
There’s nothing published on criteria for processing SNAs or upgrades. If a hotel has 10 Ambassadors with SNAs or upgrade requests checking in and only three suites available, what’s the process and order on upgrades?
A LT Titan or Plat doesn’t carry weight; there’s no membership coding for that.
Does it come down to: paid rate (and amount of $$); award; stay history; date of booking? They can’t see length of membership.
As an SPG Platinum I was frequently upgraded to Presidential suite pre merger. Consulting traveler with over 75 nights per year. Now as a Titanium with Bonvoy I’m lucky if they move me to a higher floor.
No it’s not, happened to me twice. Once in Philly and once in NYC. Dufass.
@Bill : totally concur with you. the easiest way to spot the loser trolls are always the one who tout how many trillion years of lifetime plutonium status (or the ones claiming they’re lifetime users of a service/tech product, but somehow the recent minor change was the final straw, without ever showing proof and doesn’t speak with the knowledge who actually know how jack works if one has been a customer for 10 years, always claim their favored entity gives them 100% upgrade rates (and not showing any proof), then parrot the same talking points as those major losers at Flyertalk.
And the same losers always jump ship and act like they’re on some moral high horse and claim zero ownership of ever liking the thing they were touting just 2 days ago. I once exactly linked his own words about how he knows everything and being super excited and i was being a negative ned, and when my prediction came true less than 6 months later, he claimed “i wasn’t all that gungho to being with”. These kinds of losers exist everywhere.
Bill, you’re a good man. Stop wasting your time with those losers.
It has been an unmitigated disaster; and, without wanting to sound obsequious, you were one of the very few to sound the alarm bells from the beginning.
The cluelessness of the Marriott loyalty planners has been something to behold..
My experience with Marriott is my status is basically worthless. Marriott would be smart to up their game with Bonvoy. It’s easy to choose other hotel options. Hyatt stands out. Hilton is decent. I don’t understand why the folks at Marriott are penny wise but pound foolish.
Hyatt status is also thoroughly worthless other than the old Diamond (what’s the top tier now ? Elitist ? Globalist ? Narcissist ?)
Hyatt mid tier, even before World of Hurt, was thoroughly useless. My MGM status comped me Hyatt mid tier for 3-4 years and i never bothered to use it.
Can you prove to me you’ve had actual experience with Marriott-equivalent of the Globalist that wasn’t status matched over to justify your claims ?
I completely agree with this article at least inasmuch as the Bonvoy program sucks compared to SPG. Will probably be switching to Hilton in the near future.
So tired of the SPG whining – if things were sooo perfect your company wouldn’t have had to sell in the first place. Been there with SPG and as a former Hilton Diamond got little to no respect from that company. Am loving my MB Amb Elite now. These are first world problems and your piles of sh*t won’t make the grass greener on the other side. Suck it up, buttercup.
Sounds like another legacy Marriott person who has it better post-merger…say thanks to SPG for giving you actual usable benefits
Lifetime Titanium at Marriott. Ever since Bonvoy the program and service has been abysmal. Numerous technical glitches at the onset (missing stays, award night reservations purged, etc.) followed by a complete drop in providing good service to loyal patrons. I got fed up in June of this year and have moved to Hyatt (Globalist Challenge via American Airlines). My goodness, Hyatt treats their frequent travelers very well and their rewards program is top notch! Case in point, I recently stayed at the Hyatt Regency in a suburb of Chicago, as a Globalist, got upgraded to a suite at check-in, got access to the breakfast buffet for 2 adults and 2 children ( $70 value per day when the room was $100 per night). In Vegas this past weekend and stayed at the JW Marriott. The ‘perks’ offered to Lifetime Titanium, was juice/coffee and 2 pastries (stale and tasted like shortening) for 2 people even though we had 4 on the reservation. In addition, had to pay a resort fee for items that are complimentary for Lifetime Titanium. The hotel was not close to full and the best room available at check-in was the room type we booked (and I won’t get into the details as to how ‘tired’ that JW Marriott is).
Another point – With Hyatt, you can confirm upgrades at time of booking – We will be staying in a suite at the Park Hyatt in Paris (Normally $1,500 a night). At Marriott, the SNA’s have provided no benefit to me at all as 5 of 5 requests to use them have failed to getting any upgrades (and I am not holding my breath that we will get one when traveling to London next year)
Last, but not least, Marriott has shown zero initiative to address my concerns. I wrote a fact-based email to Marriott customer service of all the troubles tied to Bonvoy. I did not get a reply for over 3 weeks, even though I reached out twice (one email, one call) during that time. And when I did get a reply, it was a generic form letter response that had nothing to do with my inquiry.
Comparing that to Hyatt, the one incident I escalated was addressed immediately (and correctly). In addition, there were points added to my account that exceeded my expectations.
I have very little desire to ever stay at a Marriott again.
I just reviewed the Park Hyatt Paris-Vendome and we loved it. Enjoy your stay.
This comment was supposed to be at the end…
I think you are underestimating the importance of a broad footprint for a lot of travelers. When I travel for work, I want a hotel close to my first meeting. I also need a lot of hotel choices in domestic markets that aren’t huge cities. For example I’ve made some hotel stays in the Hudson Valley this year. In these kinds of places, there are plenty of Courtyards, Residence Inns, Hamptons, Hilton Garden Inns, but few Hyatt Places. Hyatt is expanding but will take years to get there. If I can’t stay where I want with Hyatt, I will stick with Marriott and Hilton. I’ve stayed with Marriott more this year because they are everywhere I need to be, and Starwood helped with that. Hilton is good too. And I can always redeem UR for Hyatt.
@Kyle : yea a Hyatt-SPG tie up merely overly-amplifies themselves in the same space while really offering no orthogonality to fix each other’s problems. People say Sheraton is tired ? So is Hyatt Regency. High-end business segment like Grand Hyatt ? Conrad by Hilton beats the crap out of GH.
Two small and high end focused chains will overly dot the same urban markets and do absolutely nothing regarding footprint. You know there’s a world outside London Tokyo and Paris that some of us like to see.
Hyatt offers exactly 1 hotel in a major business and partial town of Munich. Really….. 1.
Loyalty programmes tend not to be the main drivers of M&A.
If I was growing a hotel chain by acquisition, I would be more interested in targets that provide geographic synergies (ie, opens my chain into new locations where I am not present) or new market synergies (ie, provides me with a new chain that serves a different class of guest to what I currently serve).
For Hyatt, I don’t think SPG offers that at all. Hyatt and SPG are known for their limited geographic footprints and for being realitively high-end.
Meanwhile, Mariott already had a relatively large footprint geographically and although it has a few nice properties is generally not as exclusive as SPG.
I don’t think SPG was a good fit for Mariott but I think would have been even worse for Hyatt. SPG is also a big acquisition for Mariott but would have been huge for Hyatt.
I think it was a poorly thought out deal by Mariott driven by fear that if it did not buy SPG, someone else would and Mariott would lose out.
I think Hyatt was lucky it did not close the deal and overpay and now Mariott has a poorly fitting chain to integrate that does not offer great synergies.
I can’t speak to legacy Starwood, but the big difference from Marriott is Hyatt manages most of its full-service branded hotels. This ensures consistency. Marriott only manages most of its upscale brands internationally. Domestically, the vast, vast, vast majority of properties are managed by third-party operators. Even Ritz-Carlton and J.W. Marriott, both of which historically were almost always managed by Marriott both domestically and internationally, are beginning to be managed by third-party operators. This creates a lot of uncertainty and significant differences in guest experiences.