Merger between Marriott and Starwood: What impact?

Last week, Marriott and Starwood announced their merger in a rather terse press release.
For the past few months, rumors of hotel group consolidation have been circulating: merger between Starwood and IHG, Starwood and Accorhotels, Accorhotels and FRHI.
The merger announcement did not surprise the markets, even if the marriage between Marriott and Starwood was not really expected.

Beyond the obvious cost synergies, this merger will have significant impacts on the customers of both chains. Is this the best possible marriage? Probably not. TravelGuys has therefore chosen to decipher the impacts for its readers: frequent travelers, and on 3 axes: brand complementarity, geographical coverage and loyalty programs.

Marriott and Starwood, a well-balanced brand portfolio

Historically, Starwood has a portfolio of 10 rather premium brands, with only two brands that I would classify in the economy segment, namely Four Points and ALoft. This positioning attracts business travelers who are sure to find a minimum level of service at the chain’s hotels, and ensures a nearly uniform experience for members of the SPG loyalty program.

Marriott, 3.5x larger than Starwood, has 19 brands ranging from Premium-Economic to Grand Luxury. Marriott has a network of brands adapted to long stays, such as Springhill Suites, Residence Inn, Fairfield Inn and TownePlace Suites.
Complementarity is therefore quite good in terms of brands, and even if some have a duplicate strategy (Sheraton with Marriott, Renaissance with JW Marriott, St Regis with Ritz Carlton), combining brands is largely possible.

For the Starwood traveler, this means a choice of higher comfort levels. For the Marriott traveler, it means more availability in Premium hotels in major cities.

A clear geographic focus on North America

Both Marriott and Starwood are clearly focused on North America, as evidenced by the list of Marriott and Starwood properties.
Outside North America, only the capitals and some major cities are (poorly) served.
Example with our country: if Paris is well served, the other cities are served in a scattered way.

At Starwood, a Meridien in Nice and Cannes.

At Marriott, a few Courtyard Marriotts here and there, but nothing too fancy.

IHG’s network is better, and Accorhotels’, obviously, is unbeatable in France.
In Asia, it is a little better, but not extraordinary. And in South America, clearly bad.

Uneven loyalty programs, a big advantage for Starwood

This is where the TravelGuys are the most picky.
For years I have been proclaiming that SPG (Starwood Preferred Guest) is the best travel loyalty program in the world, including travel and stay, and a model that should be followed by all. Why ?

Because the rules are perfectly clear for earning points,
Because the rules for qualifying for status are clear,
Because the benefits are realistic and have real value for both leisure and business travelers,
Because it changes for the better every year,
Because even at the highest status, continuing to stay brings new benefits.

Practically

I have been Platinum for 6 years in a row, and as of this year Gold for life,
And every year, I’m sure I’ll be upgraded to a suite at least 10 times, whenever I want,
And I am very often upgraded to a suite without even using this guarantee,
And I never pay for breakfast,
And I always have access to the lounge when there is one,
And my room is always ready when I arrive, even at 8am,
And I always have my room until 4pm.

As for Marriott, I was able to enjoy the Platinum status two years in a row when I lived in the United States, in addition to the Platinum status at Starwood.

I don’t remember it as a memorable experience: the upgrades were not systematic, and even if I often had access to the lounge, I don’t remember such privileged treatment as the one I enjoy at Starwood with this same status.

So I hope, as an SPG member, that the DNA of the program will survive. Which is quite possible, considering that SPG is a much stronger brand than Marriott Rewards.

Conclusion

It’s hard to say how things will evolve at the moment. Starwood has made numerous announcements to indicate that their loyalty program will not change in 2016. But what happens next? The next few months will tell us.
In any case, when there is no Starwood property, my preference would be for a Marriott property. Why ? There is a good chance that when the two loyalty programs merge, the point accounts and qualifying nights will be merged!