Marriott And Starwood Merger Starts With Focus On Loyalty

Photo: ellenm1

With its $13 billion acquisition complete, Marriott International has taken the first steps to integrate with Starwood Hotels & Resorts by focusing on the two companies’ most loyal customers.

As of today, the 78 million members of Marriot Rewards, Starwood Preferred Guest and The Ritz-Carlton Rewards loyalty programs will be able to link their accounts—and their points—and redeem them across the company’s combined portfolio of 5,700 hotels in more than 110 countries. 

The linked loyalty programs will be “status matching,” with gold or platinum elite members in one program getting equal status in the others, no matter their history with the brands. For now, Marriott Rewards will continue to partner with JPMorgan Chase for its credit card program and SPG will remain with American Express to offer the Starwood Preferred Guest Card.

Three Marriott or Ritz-Carlton reward points will be equal to one Starwood point.

Combining the programs in the best interest of customers was always a key reason for the merger; “a major reason we’re doing this deal is the loyalty programs,” Marriott Chief Executive Officer Arne Sorenson said earlier this year. And of course the deal, which Marriott says will take about two years to complete, also helps the company cut costs.

Marriott, now the world’s largest hotel company, also said it plans to keep all 30 distinct brands; in the luxury category, for example, it will now have Ritz Carlton and JW Marriott, as well as the former Starwood brands St. Regis and W Hotels. Starwood’s lifestyle brand Aloft will join Marriott’s Moxy and AC Hotels; the Marriott brand will complement Sheraton. Sorenson said the goal is to “emphasize the distinctions” between each brand, and giving the consumer more options.

The purchase also gives Marriott more leverage with corporate travel buyers, making it easier to negotiate with a single supplier, especially with its new Starwood inventory in Asia. It also makes Marriott a stronger competitor to online agencies like Expedia and Priceline.

The merger received its final approval from Chinese regulators earlier this week, clearing the way for the purchase to be finalized today.