Starwood Signs Amended Merger Deal With Marriott

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The bidding war for Starwood Hotels & Resorts is well underway with Marriott International countering Anbang’s offer of $13.2 billion, raising its bid from $12.2 to $13.6 billion. Starwood released a statement on Monday confirming it has signed an amended merger agreement, creating the world's largest hotel chain and bringing the Marriott Rewards and Starwood Preferred Guest loyalty programs under the same roof.

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But with Marriott and Starwood loyalty programs having significant differences in point value and perks, how does Marriott plan on bringing the two programs together? Will they devalue SPG Starpoints? Or will Marriott take its lead from the hotel industry’s most successful loyalty program and increase the value of Marriott Rewards?

How The Loyalty Programs Compare Now

Although the two loyalty programs are a similar structure, there's no doubt the Starwood Preferred Guest program provides the most valuable points. Starpoints value is roughly 2/2.5 cents per point compared to Marriott Rewards 1 cent per point. SPG members have every right to be nervous about the future of the loyalty program when 100,000 SPG points provide double the return of 100,000 Marriott points.

Another area the two programs don’t line up is the perks received at the top levels of each program. As an SPG Platinum member, you receive health-club, guaranteed room upgrades to the best available room, and Club and Executive-level access. Platinum Elite membership with Marriott will only offer you ‘complimentary' room upgrades without the other benefits, and provides no guarantees.

Marriott’s Intentions For A Joint Loyalty Program

In its presentation, Marriott clarified that during the integration the loyalty programs will run in parallel with no changes but they plan to bridge the gaps between the programs with the goal of combining them.

Marriott acknowledged SPG’s success in the affluent lifestyle segment while promoting the Marriott Rewards business customer base. Co-branded credit cards have also been suggested but at this stage, the current offers will remain as they are while the programs run in tandem.

What the details of a combined loyalty program will look like we will have to wait and see. The announcement on Monday is the first time we've heard the loyalty programs will be consolidated, and there are few concrete details.

Either way, it's likely to be a long process and the programs could run as they are for up to 2 years.

Starwood Signs Amended Merger Deal With Marriott
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Comments

  • The merger is pretty scary if it goes through with Marriott. It is rare that the bigger a company gets, the better rewards it can offer everyone.

    Sure, they may have more options and perhaps better prices, but they’re not going to be giving away awards when there are now twice as many people that could take advantage of them.

    I’d love to be proved wrong!

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