Inside the Marriott-Starwood merger's loyalty challenge

When news of the biggest merger in hospitality history—the Marriott-Starwood union—first broke nine months ago, Starwood members mourned as if a treasured pet had died.

“Everyone got really worried about the Starwood Preferred Guest (SPG) loyalty programme and what was going to happen to their points,” says Irene Lin, who worked for Starwood for three years before becoming Asia-Pacific VP of digital, loyalty and portfolio marketing for Marriott International. Her post-merger umbrella of responsibilities covers ecommerce, digital marketing, social engagement, loyalty programmes and event activation for three hotel brands: Marriott, Starwood and Ritz-Carlton.

To be more precise, says Lin, it seemed Starwood members actually went through the full stages of grief. First there was shock, then anger—129 people signed a petition against the merger on Change.org; others took to Flyertalk and social media to express their opinions—followed by sadness and confusion.

“SPG members were outraged because of the fear that the benefits, uniqueness and elite status of the SPG programme will be lost to the impersonal Goliath that is Marriott [which] is known to have an awful membership programme that dilutes points, has weak partnerships and does not look to take care of its individual travellers,” wrote one impassioned petitioner, Pete Griffin.

Lin herself is partly responsible for the extent of this outcry—she oversaw loyalty marketing at Starwood before the merger. Still, once it was announced, her team set out to assist Marriott senior management (president and chief executive officer Arne M. Sorenson and global chief commercial officer Stephanie Linnartz) in drilling into why the members cared so much. “They really, really made time to talk to the members to hear actual consumer feedback,” she says.

To their surprise, most people didn’t talk about the potential loss of points under the merger, even though some members had racked up millions from travelling so much.

Rather, guests’ main feedback was about status and recognition, says Lin. “With so many more thousands of hotels under the new entity, they were afraid they wouldn’t be ‘known’ anymore or feel special when travelling.”

This realisation, that loyalty is returned not just because of accrued points but consistent service offered by everyone from the hotel’s receptionist to the general manager, was a major turning point.

“From a Marriott perspective, preserving that and making sure we don’t lose touch with that personalisation of service is our opportunity.”

Member care is now driven by data, Lin says, to enable the hotels to pinpoint specific preferences among their many individual guests. Globally, the three loyalty programmes—Marriott Rewards, Ritz-Carlton Rewards and SPG—have more than 100 million members. “The more they engage with us, the more they build their profile with us, the more they let us know what they like or don’t like, the more we’re able to personalise,” she says.

Details make all the difference

This personalisation can go down to the smallest detail, Lin explains. All 6,000 properties in the hotel group meticulously codes every characteristic of each of their rooms, including high floor, low floor, corner room, hair dryer, bath robe and so on, and then logs the choices of each member guest whenever they make a booking. An individual guest can therefore have multiple “travel personas” that different properties can provide for, Lin adds.

It is already possible to interchange points between the three loyalty programmes and the servers, fundamentals and marketing of all three will go through a process of being “harmonised” up to 1 January, 2018. By this date, it should all “almost feel the same”, says Lin. “We’re harmonising to make sure that it doesn’t really matter what programme you belong to. You will understand how it works.”

Lin speaks of the merger with the confidence garnered from a 16-year career in hospitality, which has taken her from Canada’s Toronto and British Columbia to Seattle, in the US, and finally back to Malaysia, her home country, in July 2013.

Irene Lin's professional CV 2016 Vice-president, digital, loyalty and portfolio marketing for Asia-Pacific, Marriott International 2014 Vice-president, distribution, loyalty and partnerships for Asia-Pacific, Starwood Hotels & Resorts Worldwide 2008 Director of sales and marketing, The Westin Seattle 2004 Director of sales and marketing, Delta Whistler Village Suites Lin at the most recent Hong Kong Rugby Sevens

One of her biggest challenges in the coming months will be growing the newly-merged companies’ member base. Despite Marriott International being the world’s largest hotel group in terms of room numbers, not everybody in the world is a member, obviously. Cue M Live, the company’s real-time marketing command centre launched this April to help grow numbers.

M Live tracks mentions of any hotel in the portfolio on social media and combines this information with geo-fencing technology, which allows the tagging of devices within a kilometre of a certain location. Say a guest is sitting by the pool of Renaissance Koh Samui Resort & Spa in Thailand and wishing (on social media) for a special cocktail, M Live tools can alert hotel bar staff to deliver it in double-quick time, Lin hopes.

Speed is in fact the main expectation of hospitality brands, says Lin, particularly when it comes to chat messaging and social media. “There is no question that’s the way the world is moving.”

The vocal future

The next generation of travellers will also not hesitate to be vocal on social media about whether they’re happy or not, she predicts. “We are definitely pushing behind the scenes and thinking about the company’s strategy five to 10 years from now,” she says. “What platforms and foundations do we need to build right now?”

Consumers are getting more and more impatient, so the hotel industry needs to evolve while at the same time ensuring it retains the standards that keep guests coming back, she reflects. One such evolution involves looking in more depth at guests’ loyalty habits. While frequent travellers can store points over several years, for example, others have to “earn and burn” them—a traveller who doesn’t travel much earns limited points and when they redeem something the points are ‘burnt’ in one go.

Enter the investment Marriott made this March in PlacePass. Comparable to Airbnb’s ‘Trips’ feature, this is an online meta-search engine for tours and activities in 800 destinations. It means localised travel experiences can be integrated into the three existing loyalty programmes, so guests have more choice about how to redeem their points. Lin asserts PlacePass is making loyalty to Marriott more accessible. “You can go to Tokyo and experience a local cooking class or wrestle with a sumo wrestler or something like that,” she explains. “That doesn’t cost you thousands and thousands of points. Marriott is committed to ensuring things are more spontaneous and accessible.”

The end goal is to give members an experience that goes far beyond the functional. “When you are able to customise loyalty with exclusive experiences for a hotel member that form memories, that is difficult for your competitors to duplicate. I think at the end of the day true loyalty is about relationships that are reciprocal and caring.”