Together with its acquisition of Starwood, Marriott has become exactly what it self-describes as “the world’s largest and best hotel business.” With 30 distinct brands and more than 1 million rooms, it has a claim although both Alternative and Wyndham have properties in their own portfolios. As for the quality claim, it is hardly uncontested.
Marriott has clout in the marketplace. This was the point of buying Starwood. Consolidation, as the airline industry indicates, is a positive for corporate pricing power and, finally, for share prices and earnings. The ugly flip side of companies’ marketplace power, nevertheless, is that the diminished power of customers. Less rivalry translates into less stress to do right by clients.
We may have seen the very first inkling of Marriott’s installation of the market power together with the unpublicized shift to the company’s cancellation policy. Beginning on June 15 and reported by travel bloggers, as detected, travelers booking remains have to cancel their reservations 48 hours or be charged a fee. While rules varied by property and brand prior to the shift, most hotels only required 24 hours’ advance notice for cancellations. The policy is a considerable downgrade for Marriott customers: more charges, less convenience.
In an email exchange with the firm, Marriott warranted the change as follows: “The revised policy enables us to create rooms available for guests who could have otherwise gone empty because of a last-minute reduction.” Obviously that is accurate; the policy will really enable Marriott to market rake in greater penalties for last-minute cancellations, as well as chambers. It’s a fantastic move for the bottom line of Marriott.
Nonetheless, it’s a move made at the expense of its customers. That’s a blow in the short term, and a concern for the longer term . Marriott has to combine its Rewards program using Starwood’s Preferred Guest program. Countless members of those two programs are waiting and watching, hoping that the scheme will be, if not the very best of both worlds, at least not a substantial downgrade. But that would require Marriott to act with the best interests of its customers in mind. And that policy shift strongly suggests that the business is eager and able to set its own interests.
Reader Reality Check
How can Marriott cancellation impact you, and your willingness to book Marriott remains?