4 Things To Know About The Marriott Merger With Starwood

Boy, was I caught off-guard with the announcement Marriott was buying Starwood this morning.  There had been plenty of rumors flying around since earlier this year when the company essentially put itself up for sale.

There were persistent rumors of some Chinese buyers and even a report that Hyatt was in talks to acquire Starwood.  Ultimately, it appears that Marriott is going to be the one to close the deal.

This is absolutely bad news for elite members of Starwood Preferred Guest.  Scott Mayerowitz covers some of the reasons why in his follow-up article today after being one of the reporters to break the story this morning.  SPG members enjoy many benefits that Marriott Rewards members don’t, like guaranteed late check-out and suite upgrades.

If you’re a member of one of these programs, you don’t want to get caught on the bad side of a potential change, so now’s the time to start paying attention.  There will be lots of hand-wringing between now and the merger (which is very likely though not quite guaranteed yet).  Here are a few things to start thinking about as we move towards a merger:

All Loyalty Points Are NOT Created Equal

Boy, do I say this a lot.  But, this time it’s really relevant.  Here, a Starpoint is worth much more than a Marriott Rewards point.  To be fair, probably twice as much.  Reasonable minds can disagree on the exact value, but it’s fair to say that Starpoints are more valuable.  And, there’s no guarantee that Marriott will award some sort of premium when they combine balances between the two loyalty programs (something that’s sure to happen, though it could be as far off as 2 years from now).  What does that mean?

You Don’t Want To Carry A Big SPG Balance Into The Merger

Folks with large Starpoint balances are going to want to find ways to redeem them for good value.  You don’t need to rush and burn them just to burn them.  But, you don’t want to find out what Marriott thinks they’re worth, since you’re estimate of value is almost certainly higher than theirs.  The (somewhat) good news here is that since Starpoints are much harder to earn in massive quantities, it shouldn’t be hard to find that dream vacation before the programs combine.  You’ll certainly hear more from me as we know more, but for now if you’re planning 2016 summer travel (which you should be) think about how to redeem Starpoints.

If you’re saving for a dream vacation you want to take in 2017 using Starpoints, you should plan on trying to make that reservation in the first 6 months of 2016.  This isn’t a guarantee, but it’s unlikely they’ll combine the loyalty programs in the first 2 quarters of next year.

If you’re sitting on a large Marriott Rewards balance, you have nothing to worry about here, other than you likely have too many points in a program that doesn’t richly reward their members.

Until Death Do Us Part

Lifetime status is one of the things I covet.  I want to make sure that when I finally get off this crazy merry-go-round of work travel I’ll have something to enjoy with my family for all those nights in hotel rooms away from them.  Don’t confuse your lifetime with the length of your lifetime status.  It’s whichever one of you dies first, you or the program.  In this case, it’s a virtual certainty that SPG will be going away (to be survived by Marriott Rewards).

Most likely, anyone who has earned lifetime status in the SPG program will receive something comparable in the Marriott Rewards program.  But, what’s defined as comparable?

SPG’s Platinum tier is their top-tier, even though there are different flavors if you stay more nights.  Marriott could make the argument that since that level can be had for 50 nights a year, it matches to Marriott Gold status (their middle tier).  Gold members earn a 25% bonus on base points during paid stays.  You’ll also get free upgrade internet and club access (though not at any resort properties).  Compare that to a guaranteed 4pm late check-out at virtually all properties, 50% more points and suite upgrades (don’t believe it when Marriott tells you they might give you suite upgrades).  It’s easy to see that SPG Platinum is more rewarding that Marriott Gold.

But, even if Marriott chooses to match Platinum to Platinum, awarding top-tier elite status in their program to lifetime SPG Plats, you won’t see much more of an increase in benefits other than a 50% bonus on base points during paid stays.

Not All Lifetime Status Requirements Are Equal

Last thing on lifetime status.  If you’re close to a tier and 2016 represents the year that puts you over the top, get it done early in the year.  Marriott’s requirements are more stringent than SPG.  You’ll need 750 nights plus 2 million points earned to qualify for lifetime Platinum.

Though there will likely be a combination of your paid nights between the two brands, SPG counts award stays towards elite status where Marriott doesn’t.  It’s unclear how Marriott will recognize award nights with SPG.

Bottom Line

Marriott Rewards members are less likely to see painful changes in the merger of the two loyalty programs.  Make sure you’re on the right side of the potential issues I’ve discussed and stay tuned for more merger details.