Marriott is investing billions of dollars to rebuild its property-management, reservation and loyalty systems. That’s a huge effort, and it’s going to effect every stay.
CEO Anthony Capuano says hotel owners are focused on the cost savings, but he is most excited about how much more revenue they’re going to get from guests: “the ability of our teams and our partners to be able to merchandise what we’re selling.”
In a Wall Street Journal interview, he explained a 150-room Autograph Collection hotel in an old European building might have 130 different room types. Marriott’s current system doesn’t optimize how those are sold, but the new one will. Now guests get better rooms than the minimum they’ve paid for, because the system treats rooms as alike. In the future, guests will pay.
Marriott also wants to sell restaurants, spas, and golfduring the booking process. It’s the airline retailing model on steroids.
It’s The Progression That Began With The Starwood Merger
This strategy has been building for a decade. In 2016, then-CEO Arne Sorenson explained why Marriott could have more than 30 brands without spending heavily to market each one separately. Marriott’s “principal model” was to go to market through its loyalty platform, website and app.
The idea was that customers would start with Marriott, and they’ve book the hotels Marriott showed them. The brands almost didn’t matter (except that separate brands meant they could have more hotels in their inventory, and earn revenue from more rooms). They’re just labels and filters in Marriott’s booking engine.
Marriott only owns about 20 of its 10,000 hotels. It’s basically a brand (built on a rewards program) and a technology stack for the hotels it does not manage. Bonvoy supplies the audience, or what some owners refer to as “leads.” Now, the new technology stack will sell more than just rooms to the Bonvoy audience.
Marriott is using Amadeus to supply the new central reservation system that supports room attribute selection and sales of amenities such as spa and golf. Amadeus compares the broader shift with airline retailing, while it lays out the revenue opportunity. Merchandising opportunities include:
- The room: bed type, view, floor, balcony, layout, connecting rooms, distance from the elevator and perhaps the exact room.
- Time: early check-in, late checkout and longer day-use windows.
- Buy ups: faster internet, breakfast and lounge access.
- Activities: dining credits and reservations, spa treatments, golf, parking, cabanas and other resort activities.
- Amenities: flowers, food and beverage, family amenities and celebration packages.
- Upgrades: a better room or suite sold before arrival, at check-in or through an auction.
A family might pay to guarantee connecting rooms (even though Hilton has this functionality without an explicit upcharge) rather than take their chances at the front desk. Another guest might value a room away from the elevator rather than booking a “standard king.”
But feature turned into an ‘attribute’ becomes a separate decision, upcharge, and more difficult price comparison across hotels.
More Paid Buy Ups Means Fewer Upgrades
Marriott has been developing digital cash-upgrade placements and new merchandising. Some elite members are already being asked to bid for suites they are supposed to receive as complimentary upgrades when available.
Once each better room gets sold continuously, the inventory will be held back from free upgrades. Marriott’s Nightly Upgrade Awards are already cleared only from restricted inventory the system forecasts that it can’t sell. The new technology should improve the forecast and create more chances to collect cash.
Airlines followed this path. They used to offer upgrades into 90% of domestic first class seats. At Delta it’s now about 12%, as the airline sells the seats to coach passengers for as little as $26 rather than making them available to $30,000 a year passengers.
Marriott is planning to sell you ‘more control’ and ‘more choice’. It means paying more for the stay than you do today. And that comes out of the exact inventory guests currently receive their Bonvoy benefits – which means the value of Bonvoy itself will fall, and Marriott will have less to offer owners going forward.
My plan for Marriott — JUST SAY NO.
Lipstick on a pig
@Gene — Bah! Nancy lives on…
Does this mean I’ll get a discount for the wheelchair accessible room I need which is always facing the trash dumpsters or a brick wall? Surely not. That room will just be used as the baseline standard room.
On the bright side, maybe their reservation system will now make it easier to find an accessible room like every other hotel chain which has a button to click to filter for accessible whereas with Marriott, you have to individually select each room type and then choose accessible and then see if it’s available. If not, start over. It’s the most insulting website I’ve ever seen.
The problem with upselling, bundling packages, etc. is the hotel has to actually deliver what it sells.
Based on 8 years of my experience as an ambassador with Bonvoy, the vast majority of Marriott properties never deliver a room on a “high floor” with feather feathers despite being requested AND confirmed through an ambassador services agent.
Even now, many properties have multiple fake room categories when, in reality, the rooms are actually identical. It’s not uncommon to see a Sheraton selling a “high floor” king for $10 more per night than the standard king. The problem? A room on floor 5 in a 10-floor Sheraton is hardly a high floor room.
It will be almost impossible for Marriott to deliver what it sells when the vast majority of Marriott hotels are no longer managed by Marriott.
The enshittification will continue until morale improves
@Allen — Uh oh… looks like the ‘enshitifying’ will be indefinite.
LT here and I’m already seeing this and really find it annoying.
What has been promised as a status benefit for years is disappearing.
There are significant exceptions at properties where I have a long term relationship.
“…and the times, they are a-changing.”
Airlines are profitable [almost] solely from their FF programs. But they own the product they are selling. Hotel chains, like Marriott, do NOT own the hotel rooms they are selling. Does the franchisee have to pay Marriott more money in fees if the customer buys an upgrade? And if there will now be less chances for a free upgrade, why pursue any sort of status whatsoever? [Before this discussion veers off into a discussion of the lack of upgrades on airlines, let me just say that I have been upgraded on 38.5 percent of my flights this year — 10 out of 26 times.] Will a room with a single twin now be the hotel equivalent of “Basic Economy,” and one has to “buy up” from there?
I’m Lifetime Platinum with Marriott, but now I’m thinking “why bother”?
The airlines have proven that a significant percentage of elites are willing to overpay for “frills,” and that this is the best way to make money in our economy. Hoteliers would be foolish not to adopt this strategy. It’s obviously unfavorable for those more value-oriented, but they’re not the ones dropping the Benjamins.
Think Marriott should team up with Delta. They seem to have FF’s who love getting next to nothing in return for their loyalty.
What business is Marriott in? From your reporting we’ve learned that Marriott/Bonvoy seems ancillary to providing a consistent lodging product. “Their” hotels aren’t owned by them and they seem to have little or no control over them. There is no “Marriott touch.” Their points are losing value and their loyalty amenities are increasingly becoming aspirational. Maybe Marriott is just becoming a consultancy that advises hotels on how to extract maximum revenue from their product. I, for one, never pick a hotel because it’s linked to Marriott anymore.
I a, finding it hard to stay at Marriott. They are so expensive compared to local alternatives. It’s like they’ve are being asset stripped by private equity.
Marriott is offering a bunch of upsales for stuff I don’t care about. I’ve been “upgraded” into rooms on the dark side of the moon before when all I want is a nice place to crash between flights and not to lose an extra 15 minutes lugging my stuff to/from my room.
I want a comfortable room, reasonably fast and stable wifi, a 4 PM checkout, lounge access if applicable, and a decent breakfast. Modest preference against king beds. I’m not going to use the hotel spa (it’s generally 2-3x what I’d pay elsewhere) and don’t care about most of the rest of the stuff they might offer – it’s not like their restaurants are Fairmont-quality, now, is it?
[Hyatt already has a version of this problem. I don’t generally give a [bleep] about my room being on a high floor. Kick someone else up there and just file me in a standard room. I’d waive Globalist upgrade rights to save a few bucks.]
Lifetime Titanium here and have no problem with this. It is how these programs (hotels and airlines) have evolved. We are NEVER going back to the glory days when you almost always got upgraded as an executive platinum w AA or got a great suite as top tier w Hilton or Marriott. Also, there is a misunderstanding on what is “owed” elite members. The upgrades, even at Hyatt where I am supposed to get one as a Globalist, are based on available rooms. If you check in for 3 nights even if a suite is available the first night the hotel is dumb to give it to you since they may sell it the other nights. That is just business. If you don’t like it go somewhere else but all are pretty much the same. If you want an upgrade pay for it. I do or use a program like Amex FHR to hotels.
All the bitching and moaning about how things are the way they used to be is frankly not productive. Adapt or just keep whining.
I actually welcome this. Currently, booking a room is a pig in a poke, you never really know what you’re getting. You can call the hotel and you still don’t know. You can look at the same room on different sites and see different photos.
That said, they’d better get it right. They won’t be able to hand wave it off if you’ve paid more for certain features. What if they sell you a balcony or a certain view, but they don’t have many of those, and one is out of commission with a problem? They’d better be prepared to upgrade people in that case or credit them handsomely, if that’s what they actually paid for.
So much whining, Gary. If you want a suite, buy a suite. You’re not really so special you deserve an upgrade just because.
Despite being a staunch capitalist, it never ceases to amaze me that the most wealthy people in our society expect the most freebees. Like the famous $10M+ athletes and movie/TV people who expect every meal they eat in a restaurant to be comped.
@BBT — Too late; that’s why Marriott already partners with United…
@Retired Gambler — Sane-washing corporate greed or normalizing these devaluations, like you do regularly on here, isn’t ‘productive,’ either.
Dear Marriott, I currently have zero Bonboy points, but expect to earn 100s times that in the near future.
Airlines and hotels aren’t the same.
If I buy an upgrade into first class or I pay for an extra-legroom seat in economy, there is something tangible the airline has to provide me.
By contrast, there is nothing really tangible about a hotel upsell into a higher floor room or a room with a view. What’s the definition of a higher floor? What’s the definition of a room with a view, especially outside resorts or scenic locations?
As someone else said, individual properties struggle to fulfill what corporate sells.
Look at the number of properties who sell rooms with club lounge access only for there to be no open and operational club lounge.
I don’t think this will work out for Marriott.
@FNT Delta Diamond — “Airlines and hotels aren’t the same.” Genius.
I admit that my loyalty to Marriott is rapidly waning, especially for the pricier brands. The fact that Marriott owns only 20 hotels speaks volumes. Twenty-six years weren’t completely wasted, as we received generous upgrades and had grand experiences before the merger. Now, I’m questioning my usual ” book the room you want” Marriott strategy. Recently, I spent a weekend at a Residence Inn (obviously a business hotel) based on the rate. A week before arrival, I received a “welcome” e-mail listing all the upcharges available………ranging from room upgrades to late check-out to cookies. Frankly, the e-mail was annoying. A quick scan of the Marriott website showed a nearby Marriott at $250+/night and an oceanfront Four Points at $160+/night. So I did what I always do when booking a basic rate: I called the hotel, requested a high floor, extra towels, and an upgrade if one was available. The front desk upgraded me immediately to a corner suite on the 6th floor. When I arrived, I opted for the market item and was told to take whatever I wanted plus water. The hotel was spotless, the towels were super fluffy, breakfast was adequate, and the staff was personable.
Having status with Marriott no longer means loyalty at any cost. With so many other brands to choose from, I, for one, will broaden my future lodging searches.
Doing so much analysis on what to upsell and optimize the revenues will not be possible without 24/7 AI engines calculating all these factors and deciding the rates.
@Nick Thomas and @Sue nailed the problem: all this looks fine on paper, but are the hotels capable/willing to deliver? If not, it’s going to get very ugly very quickly when people pay for specific features and the hotel doesn’t deliver. Heck – they can’t even accurately tell whether an accessible room has a tub or roll in shower from their system. It’s always a crapshoot regardless of the room I book. And now we expect them to know the details of every room to upsell specific features? Ha!
@TheJetsFan: They already don’t deliver. Marriott sells many upsells already, especially if you browse through package rates. I book suites that are hundreds more than a standard room and 99.9% of properties, across all brands, won’t even put an amenity in the suite.
Marriott dropped the requirement that ALL properties use MARSHA – its proprietary res system, and many have been installing and using their own PMS’s for a while. Some of the things talked about in this post are already available – thru Canary Technologies – and other providers who have overlays on top of the main res system. Airlines have been doing this FOR YEARS — ever wonder why Plusgrade is the system that handles your upgrade with many airlines?
Sounds like Marriott is going to sunset the cobol-based MARSHA platform with something else.
Longtime patron of Marriott and Hilton but no more. I gave up on both of them. Rates are often SKY HIGH with both and we now use search engines like Hotels.com, or Booking.com and similar and stay at ANY hotel with good rates/deals. A shame the Loyalty programs now turn us off so mch. We were loyal to Marriott and Hilton for decades too.
edit: I meant Marriott’s preferred PMS’s to connect to MARSHA. Which will be replaced.
I would never pay for an ‘upgrade’ at a non-resort regular hotel. An upgrade can be to a ‘higher floor’ as many have mentioned – the floor could be 1 floor higher than the ‘regular’, and even if on a really high floor, things may be much worse. I was upgraded to the 10th floor once, which was pretty high with a wonderful view of… a busy, noisy intersection. I kept the drapes closed. And I had to wait forever for the extremely slow elevators. Not really a ‘benefit’, is it?
@ jcil
Thats the whole point of this blog is whining about loyalty points…otherwise if habe alot of $$$ none of this matters.
We are going through a consolidation period: people have designed their travel habits around others paying and theu reaping the rewards. Now both airlunes and hotels realize they have u by the “balls” and they are consolidating. In a few years enough people will stop buying credit cards as the rewards go down and then some new commer (southwest? Hilton? ) will actually offer something good and their ceo will be called a genius and a “disruptor” it’s the circle of life
As a Lifetime Platinum I’m trying to figure how these changes will help me and I’m coming up with a simple answer: In no way whatsoever.
In December of 2022 Marriott signed a contract with Agilysys (AGYS) to replace it’s proprietary Property Management Systems (PMS) with Agilysys’ Stay PMS cloud-based PMS as well as it’s Infogenysis POS platform (for payments). That project has now started the roll-out/implementation phase which will supposedly be completed in 1-2 years. The Agilysys PMS and POS platforms will be tightly integrated with the new Amadeus-based Marriott central reservation system (that is replacing MARSHA) and this is what, in theory, is going to enable all of the enhanced functionality/features Gary mentions, including the ability to book connecting rooms and property level services like Spa appointments, golf tee times, etc. through the Marriott website/app. The key is that you have to replace both the central reservation system AND the individual property managment systems in order to get all of the enhanced functionality.
They started the roll-out of the new PMS/POS with the select service brands like Fairfield and FWIW early reports are not particularly encouraging: https://www.reddit.com/r/askhotels/comments/1s17wsx/marriott_new_pms_power_of_m/