Hilton’s new West Palm Beach hotel. Hilton tied for first place in rankings of guest loyalty programs. (Image: Hilton)
J.D. Power and Associates has come out with the results of a new survey on hotel loyalty programs, and the results raise a new question about the upcoming acquisition of Starwood Hotels by Marriott.
That acquisition was approved by shareholders of both companies on Friday. In the run-up to the deal – which is on track to be finalized by midyear – Marriott executives cited the devotion of Starwood Preferred Guest (SPG) loyalty members as one of the reasons they found Starwood such an attractive merger target.
But here’s the thing: In the new J.D. Power 2016 Hotel Loyalty/Rewards Program Satisfaction Report – based on a poll of more than 3,000 U.S. hotel program members – the SPG program’s score was way, way below Marriott’s, and well below the industry average of the 14 programs in the survey. In fact, it was almost at the bottom. (As it has been in previous years.)
Marriott Rewards tied with Hilton HHonors as the top-ranked programs, each with a score of 741 on J.D. Power’s 1,000-point scale. Also scoring above the industry average of 711 was InterContinental Hotel Group’s IHG Rewards at 722. And Starwood’s SPG? It ranked 13th out of 14 with a 674 score, just above last-place Red Roof Inns. Starwood didn’t fare much better in last year’s results either.
Here’s the full list for 2016:
In the case of Starwood, our best guess as to its low ranking is that SPG puts a lot of focus on keeping its elite level members happy, likely to the detriment of the much larger pool of non-elites. The JD Power survey polls all members– not just elites. Had it done a poll of hotel program elite members, I’m sure SPG would have placed much higher. And it seems to be SPG’s elite level members that are the most vocal when it comes to the Marriott/Starwood merger.
Loyalty programs are rated on a number of factors, including account management, ease of redeeming points/miles, ease of earning points/miles, variety of benefits, reward program terms and customer service.
Some 77 percent of survey respondents said they believe their preferred program is just as valuable as it was a year ago. The main reason that consumers select one program over another when they join, cited by 40 percent, is the convenience of that company’s hotel locations at the destinations where they travel.
Readers: What’s your take on loyalty programs? Do you agree with the J.D. Power survey findings?
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Hmmm… well… this chart uses an old trick to accentuate differences. The baseline is not zero, but something around 600. If you normalize these scores such that Hilton and Marriott are 100, then SPG would be around a 91. Certainly that’s a difference, but it’s hardly the chasm that this chart appears on first glance.
I’m a big fan of La Quinta Returns. My colleagues roll their eyes or chuckle when they learn that I often stay at La Quinta on business trips, but La Quinta offers a nice discount for military veterans, and their loyalty program has given me many free nights. I’m not surprised at all that they rank highly on this list.
If it’s true SPG pays little attention to leisure travelers without elite status, which is most people, maybe it’s something most people should consider when choosing a hotel loyalty program.
Gary at VFTW eviscerated the survey yesterday. I wondered about the results as well at first. It’s a bit like the old “lies, damn lies, and statistics” line, along with far too small of a sample.