Monthly Archives

Monthly Archives for May 2015.

Starwood’s CEO Has a Unique View on Loyalty

ronald mcdonald in united plane toy
May 03 2015

Adam Aron no longer has ‘interim’ in his Chief Executive Officer title at Starwood. He launched Pan Am’s first frequent flyer program. As Hyatt’s Chief Marketing Officer he launched Gold Passport. I had the pleasure of interviewing him on stage at the Travel Executive Summit on Thursday in Atlanta. Aron was Senior Vice President of Marketing at United and I got to tell the story about his economy meals partnership with McDonalds (the associated happy meal toys available on United’s Orlando flights are still available for sale on eBay). United replaced the galley carts to keep the burger warm while the lettuce and bun stayed cool. He was CEO of Norwegian Cruise Lines, of a chain of ski resorts, and later went into private equity. He became part owner and CEO of the Philadelphia 76ers.…

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What Would it Mean for Starwood to Acquire Another Chain.. Or Be Acquired?

When IHG swallowed Kimpton, I wrote: “I want to be an IHG Rewards Club Platinum” said no Kimpton elite member, ever…

Conventional wisdom is that Starwood is going to do a deal, and the most likely candidate is IHG. Some say Starwood could buy IHG. I could see IHG buying Starwood. IHG is the bigger hotel chain, though Starwood’s market cap is much higher (nearly $15 billion versus ~ $10 billion).

Starwood has struggled to generate growth and Wall Street isn’t happy. Fundamentally that’s why their CEO Frits van Paasschen was out in February…

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American Airlines Mileage-Earning Debit Card Devalues June 1

May 02 2015

UFB Direct’s American AAdvantage-earning debit card will reduce earnings effective June 1. Instead of 1 mile per $2 spent on the card, it will offer 1 mile per $3 spent on the card. In addition they will no longer reward miles for “supermarkets, grocery stores, super stores, wholesale stores, discount stores, USPS, and financial or money transfer institutions.” I already found the card and account not to be especially compelling at 1:2. This effectively takes it off the table in my view. That isn’t surprising. Debit cards are no longer financial windfalls for banks. It’s no longer worth incentivizing transactions since the Durbin amendment to Dodd Frank financial reform eliminated the profit for banks from debit transactions. The rewards debit card is almost entirely a thing of the past. Oddly, though the Suntrust Delta debit…

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