Starwood’s Brand Positioning

London’s Sunday Times carries a puff piece on Starwood Hotels CEO Frits van Paasschen “whose mantra is ‘refuel the cool'”

He has his work cut out for him, though I’m not sure he realizes just how.

Starwood has had four unique selling propositions, two of which were loyalty program-related and three of which have been matched or bettered by the competition over the past couple of years.

1) SPG True Redemption. This was the best program for award redemption, period. Not only no blackout dates but no capacity controls. But now Hilton and Hyatt both explicitly matches this, and in practice Priority Club seems close.

2) Platinum suite upgrades. Intercontinental Royal Ambassador has long had a better upgrade policy, but the program was too small for Starwood to worry about. Hilton doesn’t offer a suite benefit. Marriott’s rules were revised a few years back to explicitly exclude suites. Starwood = suites. But not Hyatt has trumped — with 4 confirmable upgrades per year at booking, not catch as catch can at checkin. At a minimum, this no longer sets Starwood apart (although Hilton and Marriott still lag).

3) The Heavenly Bed, which they extended to the Sweet Sleeper, the Four Comfort, etc. And a concept they tried to leverage in the bathroom, and the curved shower rod was a real improvement. They forced the rest of the industry to improve their beds and for the most part they have.

4) Better properties. Aspirational properties. There remain more Starwood properties that discerning guests actually want to be at, dream of, strive towards. There are some nice Marriotts, a handful of good Hiltons. But the number of unique high-end Starwood properties is a real benefit. There are some great Hyatts of course, and some very nice Intercontinentals (e.g. Bali). And of course Starwood doesn’t compete with Aman or Peninsula. But the larger brands don’t come close to the unique positioning that Starwood offers at the higher end.

They can ‘refuel the cool’ all the want. But they have to understand they offer a reasonable product otherwise, but no longer own a trump.

And I do believe — and certainly a number of people inside SPG at least do understand — that they need to recapture that.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. Totally agree. Starwood set the bar and Hyatt is catching up fast. Hilton has some nice properties outside the US and treat me very well. SPG is still the best of the mass market but the shine is fading.

    I don’t know how others feel but I am very upset about SPG’s policy of not giving credit or points for cash and point stays. If I pay them money, I expect credit for the stay.

    For 2010, I am planning to shift more of my biz to Hyatt if SPG does not address my issue with Cash and Points.

  2. RE: Upgrades/Suites. Hilton does offer this to their Diamond members and, in my opinion, offers a better upgrade rate & options than SPG.

  3. @Chris, sorry, no way — individual Hilton properties will occasionally upgrade to suites but the program itself promises only executive rooms where available for Diamonds. Starwood promises standard suites where available. SPG also lets you confirm suites in advance with points, including on awards.

  4. Hyatt also lets you confirm suites with points, or for awards (assuming you’ve run out of your 4 diamond confirmed upgrades – which I somehow got 5 of this year.) Hyatt also guarantees club access and free internet. VERY recently they have begun giving you 2500 extra points if the club is closed (many are closed on weekends.) I also like the fact that the Hyatt “bottom of the barrell properties” namely Hyatt place and summerfield suites have been quite nice in my experience. MUCH nicer than the Hampton inn and Holiday inn express properties I’ve stayed at.

  5. SPG announced it has eliminated peak season rates at high end Category 5, 6, and 7 properties for 2010 award nights. That makes their high end hotels just a bit more affordable for another year when it comes to spending Starpoints.

  6. Completely agree with Gary. Still like the assortment of top SPG properties, but much prefer Hyatt’s published benefits for Diamonds as compared to SPG Platinum these days. That’s why I’ve qualified for Hyatt Diamond already while I still need 2 more stays to requalify for SPG Plat. Gotten some awesome suite upgrades with SPG but they’ve been too few and too far between these days. Much rather have a few confirmed suite upgrades when traveling with wife/family, those times when I’d appreciate suite upgrades the most. So Hyatt works better for me now.

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