Hotel CRM Reality Check

On January 20, 2017, I booked a hotel in Seville, Spain. That is also the day that Meliá Hotels & Resorts got my email address. The rest, as they say, is history.

For those of you who are not familiar with EU-based hotel companies: Meliá Hotels International is a Spanish hotel chain also known by its former name of Sol Meliá. They have 374 hotels in 40 countries on four continents. They are not a big  household name in the US, but they got some attention back in 2010 when they sold their “Tryp” brand to Wyndham Hotels. I made several groovy jokes back then about Wyndham “Trypping,” which thankfully nobody remembers. Moving on.

So why am I taking you all the way back to 2017? Since my initial interaction with Meliá Hotels, I have received 2-3 emails from them every month. After deleting some of the earlier ones, I was almost ready to “Unsubscribe.” Then I had an epiphany: how about I stay on the list and see how this multi-billion dollar hotel company handles its Customer Relationship Management (CRM), and in particular its email marketing campaigns.

What started almost two years ago is now ready to be shared.


Buzzwords, They Keep on Buzzing

There have been over a dozen articles (plus a couple of white papers) telling us how software is transforming the hotel CRM landscape. There is more talk about how “personalization” is changing everything. However, my two-year collection of emails from a well-established hotel brand sheds a very different light on how things are in the real world.

There are over a dozen CRM vendors who will sell you their software….I don’t think this is a software issue. The biggest CRM challenge for hotels is hiring the right people. Lack of talent is a much bigger threat to the hotel industry than our world-renowned outdated technology.


Let’s Take a Trip Down Memory Lane

A couple of things to keep in mind as we take this journey together:

  1. Meliá Hotels is just an example I am using for this post. I am not singling them out as an outlier. Before you high five your marketing team, please know that there are 5-8 other hotel brands (big box and independently owned) who have sent me a similar pattern of emails.
  2. I have not included every email ever sent to me. Some were deleted while I logged a quarter million miles of flying last year.
  3. This year I published the Ultimate Guide To Hotel Email Marketing. If you think you may need help, read my guide to start sending better emails.

I stayed at the Gran Meliá Colon Hotel in Seville in April 2017. After the usual follow-up emails about my stay and 2-3 emails about leaving them a review with TripAdvisor (which I never do), a barrage of discount emails started hitting my inbox. In June 2017, I started to document some of them.

Let’s roll.


June 2017

The first email I saved offered 45% off their hotel in London, Wow, quite a deal, right? Pay attention to the “45% off,” as it will make a comeback…again and again…like Jason Voorhees.


July 2017

In July, the discount dropped…but not for long.


August 2017

August opened strong with deals to Milan…40% off!


Dropped by 5% mid August. Dang, should have dropped everything and gone to Milan from Hawaii 4 days ago! It’s not that far, is it?


Three days later, the offer is limited to only one hotel! I still have not been south of Seville. Maybe I should quit what I’m doing and head to the Southern shores? But what about the North/Atlantic part of Spain? I want to go there too. Will I get 35% off ever again? What about the 45% deal? Is it ever happening for me again?


September 2017

Dear diary, the 40% deal is back!! Wait a minute…it’s for booking next summer!? What if I don’t get time off? Unless I am working in Europe, there is no guarantee of a summer break. In the US, there is no guarantee of ANY break. 40% off is too good to pass up, but I don’t know where I will be in the summer of 2018.


Are you kidding me? 22%!? Guys, I do not get out of bed for less than 40%. You have done 40% for me before. Why are you giving me only 22% off now? Are you guys mad at me for not booking last time?


October 2017

Sweet relief! The 40% deal is back! But wait…I need to go urban this autumn? I can’t go urban this autumn! I only go “urban” in the winters!


November 2017

OMG! I cannot believe this! 50% off! How is this happening? How are they going to make any money? But wait…the email mentioned “This is only the beginning.” What does that even mean? More 50% off emails, or will I be getting even bigger discounts!? This is getting out of hand, but I really cannot travel right now so…I shall pass on this miracle. Alas, it might never happen again in my lifetime.


It’s another miracle! But this miracle actually ends on Sunday! Black Friday is not just about brawls at the local Walmart anymore. It is now about deep discounts. Sounds like I will never pay retail again for my hotel room…thank you! I feel like I am living in the golden age of hotel discounting. How neat is that!


OMG! Three miracles in one month!  This is all that’s playing in my mind right now: “We are not worthy!” I guess Cyber Monday is no longer about buying bulk paper towels. You can now get 50% off for booking a room you otherwise would have gotten at full rate. There is a lesson in here somewhere.


December 2017

22% off is for the birds! 40-50% off and then we can talk. “Season of love and laughter.” Please. If you really cared, you would offer a better deal. From 50% to all the way down to 22%…now I am sad.

Are you kidding me? 20% off. Let me put on some sad music to go with this deal.

Oh, look who’s back! 45% is nice…but what’s with the lady trying to drown the kid? Love the “say goodbye to winter” tagline. If only it was so simple. Besides, I like winter in Hawaii!

30%? No thanks. “Am I well travelled?” Does logging over a million miles in the air count?


January 2018

LOL! “Head to London in February” = Someone who has never been to London in February. Hard pass.

Oh look, the underwater lady and kid are back! 45% off to book for summer. Again, no idea where I will be, but thanks for asking.


February 2018

“Jet off to somewhere soon.” Guys, 40% off is great. But remember, we don’t do time off in US. Hope the lady has sunscreen on.

45% off is good. But…”Goodbye Monday Blues”? I love Mondays! What’s wrong with Monday?

The underwater lady is back! I really hope that kid is all right.


So glad I did not book 4 days ago @45% off! 50% discounts are back! “Book now or regret it later.” Wait, are you threatening me?


“There is no better place.” Apparently that place is also secret enough to not be above the fold in the email design. Life is full of surprises, I guess.


March 2018

Nothing inspires confidence in a new hotel like a 30% off deal on Day One.


In the era of “fake news,” your tagline % better match the actual offer.


Four days in…where? I would love to hop there in 2.5 hours. When I checked into the hotel, they copied my ID, passport, credit card. Sir, I am not 2.5 hours from anything!


April 2018

Oh look! It’s the return of 45% off Summer.


Three days later: 20%? No, thank you. Hey, what’s the mysterious black stuff on the beach outlining Best Offers? (Cue in X-Files theme.)


Beach lady makes a comeback! This time on 100% green grass. Did she like her beach vacation? We will never know.


“Short Haul” in body copy of email sent to the other end of the world. LOL.


“Reservar Ahora.” English email, Spanish call to action. Can’t lose?


“Mid Season Sale”…but that lady is floating in the water. Will she catch a cold? Also, 30-35%…I’m more of a 45% and above kind of guy.


May 2018

Back to 45%, now we’re talking.


Four days later, down to 40%.

Beach won this round.


Back to 45% 6 days later.


20%…how about not.


It’s GDPR season! Also, is she opening or closing the curtain on my privacy?


40%…hey, it’s better than the 20% off from last week.


GDPR curtain lady returns! Also, check out my points balance!

20%… nope.


June 2018

Cool kid with shades giving 45% off.


Oh no, I lost 5% discount in 2 days! This one says it will hold for 10 days only! What if I am stuck in 20% discount land after that?


Last chance? Are you sure? I will never get a discount again? Oh no!


Oh c’mon! I thought 40% was valid for 10 days ONLY! Here you are seven days later giving me 45% off! I thought we were friends.


Going urban? Sure, like Urban Outfitters? Oh hello, 45% off. Nice to see you again.


“Unforgettable memories…with 40% off” is a hilarious snippet. But wait…there’s more. “Tell Me More With 40% Off” is a hilarious call to action! How do they do it?


Nothing will warm the heart of a hotel ownership group like having their management brand kick off a new opening with 35% off.


Cool kid with shades giving 45% off is back!


July must be about comebacks. Urban lady feels like a friend now.


July offers…but for October. Let me stop everything and figure out this email. Also, only 25% off?


10% deal? Do you even know who I am? I have not gone below 20% with you! Also, 50% off in the copy of the email. What game are we playing here?


I am still mad about the 10% email. But ok, glad to see we are back to 45%.


45% off…keep em’ coming, baby!


Searching for paradise? Dude, I live in Hawaii. Have you even checked my profile/analytics? Oh, never mind.


Wishing on a star that the next email will be 45% off.


Yes! My wish came true. 45% off email is back.


I get sun here in Hawaii. In Spain, I soak up some of the world’s best food. Didn’t I do so many food-focused things in Seville? Do you remember anything about me?


Escape from what? I am not trapped anywhere. Do you think I am? Why?


35%. Meh.


35%. Meh.


Did someone mix up their Instagram motivational quote with their call to action? Also, they spelled unforgettable wrong. Also, 35%. Meh.


45%, yeah! Wait, who is she looking at?


“Exclusive Offers Just For You.” LOL!


Last one. Check out my amazing point balance.


CRM Is Not An Acronym for Email Marketing

Somewhere along the way, hotel CRM has evolved into just sending emails to guests. The typical five-step email cycle breaks down as follows:

1. Booking confirmation email
2. Reminder email
3. Check-out email
4. Request to review the property on TripAdvisor (2-3 emails)
5. Discount emails for the remainder of your life

Break the cycle. You have too much information about your guest for you not to care about segmenting. Break down your lists by geography, interests, age, and then stay in touch for more than just discounts. Hotels all over the world have scanned or photocopied my passport and driver’s license. That level of personal information is only available to the TSA (Department of Homeland Security) and border control agencies worldwide. And yes, a small hotel in Kyoto. Think about it.

Three Step Plan for Improving Your Hotel’s CRM

Step 1: Designate CRM ownership. Select a person to lead your CRM efforts and strategy. Your customer database is something you need to own and maintain over time. Your database should not be passed around like a basketball, available to any department that wants to take a “shot” at making the basket.

It is not about software, it is about who is keeping an eye on things. Any customer contacts should get a final stamp of approval from a central person who is keeping an eye on CRM database quality and ongoing business analytics.

Step 2: Check yourself before you wreck yourself. Two parties have traditionally misused the hotel email database.

  • Sales and marketing. Avoid sending a promo about something that not everyone would be interested in (eg, local restaurant/bar promos that get blasted out to everyone in your database, including guests who never used it and live over 3000 miles away).
  • Revenue management. You guys are great, but please stop using your email database like an ATM machine. Every time the revenue numbers slack off a bit, you can’t just pull the lever on an “exciting 45% off” email and wait for the reservations to trickle in. Oh, this also answers another question I get a lot. “Why are our campaigns not performing like they did last year?”

Step 3: Segment or go home. Your hotel customer database is not going to stay fit and fine forever. It is not Hisako Manda. In addition to performing ongoing maintenance, you also need segmentation. One big list should make way for smaller segmented lists. Examples include:

  • Geographic location
  • Clicks (0, 1, or more?)
  • Frequency of use (checked in more than once?)
  • Replies


Somewhere along the way, hotel CRM became synonymous with email marketing. This is really unfortunate because, unlike other industries, hotels sit on a mountain of personal data. Generic outreach chips away at any hope of building a relationship with your guests. There is a ton of speculation in the marketplace about who truly “owns” your guest. The truth is that nobody owns your guest, but you sure can make an effort to reach out and be their friend. Remember, nobody makes friends and builds relationships just by offering discounts. You have to share value to see your revenue numbers grow.




The Shrinking Value of Hotel Loyalty Programs

Shrinking value of hotel loyalty programs

My work revolves around travel. Every night away from home is spent at a hotel or Airbnb property. I was recently asked about my hotel brand preferences and which loyalty program I use. The answer is that I belong to all of them but never achieve a high status due to the fact that my hotel nights are spread across many independent and brand hotels. If I were to pool all of my annual room nights into one brand, I could easily qualify for top tier status.

Why have I not done that? The reason is simple: I am a location-based business and leisure traveler. That means that I choose to stay at the most convenient location irrespective of brand. I know I am not alone in this thinking, as many people prioritize location over brand. Let me elaborate.

Location, Location, Location

Cliché title aside, location is everything for some folks (like me). I am laser focused on location on business trips, as I like to optimize my time and control my FOBL (fear of being late).

When I am speaking at an event, I do not want to be far away from the conference location. A simple traffic snarl can ruin your reputation. (Digital marketing and revenue management speakers are not accorded the same indulgence as rock stars when they show up fashionably late.) Most of my business meetings are also at hotels, as they are often my clients. I try my best to stay at the meeting hotel for two reasons: a) To experience the asset; and b) To ensure that I am not relying on any transportation other than an elevator to get to my meeting. It’s a peace of mind thing that allows me to remain focused.

Likewise, when it comes to leisure travel, I don’t want to spend extra time commuting to the places I want to see. If Hotel X is located near the activities or attractions I want to see, or is in a neighborhood that I particularly like (eg, Saint-Germain-des-Prés in Paris, Gothic Quarter in Barcelona)… then I am staying at that hotel.

I also have an affinity for independent hotels. I especially like staying at independents when I am traveling internationally. I think it gives me better insight into the local mindset and how people run their hospitality businesses in other parts of the world.

The Incentive Games: May the odds be ever in your favor.

I have been monitoring the loyalty programs of the major hotel brands and have noticed a clear trend over the last several years: the rewards for loyalty are shrinking. Basically, the bar is getting set at a higher level while the benefits are being slashed. These devaluations are due to consolidation in the marketplace, and attempts by brands to increase their profitability.

In my opinion, loyalists have three major reasons to stick with a hotel brand:

  1. Points. Earn free nights that can be spent either at a fancy aspirational hotel or a basic property. In other words: spend on business, vacation for free.
  2. Upgrades. Get a better category of room at check-in because of status.
  3. Amenities. Enjoy a welcome gift, free breakfast, better WiFi, lounge access, dedicated reservation support, late checkout, etc.

While people have been chasing points and status, every major loyalty program has devalued their program by doing one or more of the following:

  • Increasing the number of nights you need to attain status
  • Increasing the number of points you need to book a free room by upgrading the hotel categories
  • Creating a new category of rooms and/or elite status level (which devalues the whole program)

You know who else has done this recently? If you guessed airlines, you are right. It’s “working” for the airlines, right? Passengers may not be happy, but they need to keep flying on the major airlines to get around. It’s not that easy to open up an “independent” alternative airline to meet their needs. But can hotel brands continue to reduce program benefits for their most loyal and point-obsessed guests, and still hope to keep them?

Following is a brief overview of the recent changes I’ve seen in five of the biggest hotel loyalty programs.

Marriott Rewards

In 2015, Ideaworks (a consulting firm) published a study naming Marriott Rewards the most generous hotel loyalty program in terms of earning future room stays, with a return of 9.4%. Translation: For every $100 that you spend at a Marriott, you can expect to earn $9.40 worth of points you can apply towards a future stay at a Marriott branded hotel.

They also calculated the return on three other major brand programs:
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These results were based on 1,440 queries conducted globally. The number of points required for a “free” hotel stay was compared to the room rate in dollars. The value of points was translated into dollars based on how much spending was required to accrue them.

That same year (2015), Fortune Magazine also named Marriott as having the best rewards program in the hotel business. So, how has the world’s best loyalty program changed since then?

The latest change happened on March 7, 2017, when 23% of their hotels and resorts were moved to a higher or lower category. Of those that are changing, 60% will move up; US-based hotels are disproportionately affected. This is not a new trend – it’s been happening every year for the last five years. 2013 was the big jumping off point. It was also the year Marriott added the new, super expensive Category 9.

[table id=8 /]

After the Starwood Hotel merger last September, Marriott became the largest hotel chain in the world. Since the merger, Starwood and Marriott accounts can now be linked, points can be moved around, and statuses can be transferred. This is a massive increase in the sheer number of people who belong to the joint program (rumored to be over 100 million!). The fact that status can be transferred = so many elites! It’s a classic supply-and-demand scenario. If you’ve been a Marriott loyalist, now you have lots of elites from Starwood Hotels getting the same benefits as you. When has that ever been a good thing for an elite program?

Favorite Stay:
My best Marriott experience was at the JW Marriott in Bogota, Colombia. Amazing hotel and staff, and the cutest guard dogs at the front doors.

Starwood Preferred Guest

Starwood’s SPG program has always had some serious fan boys and girls. There is a very good reason for that. For a long time, Starwood Preferred Guest has been one of the plushest preferred hotel programs out there. A mere 25 nights a year gives you a guaranteed 4pm checkout at most of their hotels! In comparison, Marriott (aka, the new owner) makes no such guarantee. In Marriott’s case, please insert everyone’s favorite customer service phrase, “subject to availability.”

Likewise, I have heard nothing but amazing things about the Ambassador program from my Starwood-addicted friends. Anyone staying 100 nights a year is assigned a private ambassador who makes reservations, hounds hotels for upgrades, etc. etc. Like I said, pretty plushy!

Industry friends always mention that it’s easy to maintain this level of customer loyalty focus when you have 1300 hotels. (Marriott now has over 4200.) Besides, to quote one of my favorite airline blog writers Gary Leff:

“It’s not hard to just fall out of an airplane into a Marriott. You have to make a choice to be loyal to Starwood.”

I agree with him 100%. You can find a Marriott almost anywhere and at almost every price point.

Marriott Rewards has well over 54 million members, more than double the 21 million members of the Starwood Preferred Guest program (estimated numbers at the time of the merger). Today, as an SPG member, you are competing with a pool of close to 100 million people for everything: late checkout, upgrades, free rooms, lounge access, ambassadors, etc. No wonder so many fan boys and girls were livid about the merger. Some of the comments were a case study in entitlement, and really made me laugh. A classic case of first world problems. But still relevant to our discussion.

The simple fact is that there are many more Marriott members than Starwood members. Marriott folks now have access to some really fancy hotel assets where they can splurge with their points to get free stays. This fact sums up the lack of enthusiasm from SPG loyalists. But, you know what? Time heals everything.

Credit card experts have crowned the Starwood Branded Amex as the best credit card for frequent fliers and hotel guests (if they often stay at Starwood properties). It offers up to five points per $1 spent at participating Starwood Hotels, and two points per $1 spent at Marriott properties. For cardmembers redeeming points for hotel stays, this card gives the most points per dollar. Points can also be transferred to more than 24 airline programs.

Starwood’s last category adjustment was in 2013, when 200 hotels went up in price and fewer than 50 hotels went down in price.

Favorite Stay:
My best Starwood experience was at the St. Regis Princeville, Kauai. Stunning ocean views right from the lobby, and also from everywhere else on the property.

IHG Rewards Club

IHG has long maintained the bragging rights for having the most loyalty members in the world. (Marriott is close on their heels with their Marriott + Ritz + Starwood numbers). IHG’s approach to redemption has been different from the other brands I talk about here. They don’t have a category-based points chart. Every individual hotel has its own points requirements for a free night. The lower end brands (Holiday Inn/ Express) go for 5K to 10K points, and the high-end hotels (like Intercontinental) go for 60K+.

In 2016, IHG made some big changes their redemption policy:

  • 650 hotels changed their redemption point requirements.
  • For 75% of the 650 hotels, the points requirement went up.

As with the other brands, their changes mainly applied to assets located in the United States. Here is the current guide to points required to redeem “free” nights at IHG hotels.

In 2015, IHG had its Marriott/Starwood–style moment (though definitely not at the same scale) when they acquired the iconic Kimpton Hotels brand. It inspired me back then to write about the transformation of the boutique hotel business. The fan favorite rewards program Kimpton Karma continues to operate separately and has not been rolled into the IHG Rewards Club (as of today.)

Favorite Stay:
My best IHG experience was at The Intercontinental Hong Kong. Fantastic food and beverage, with iconic views of the Hong Kong harbor.

Hilton Honors (The Program Previously Known as Hhonors)

This year Hilton dropped the extra “h” In their Hhonors program and renamed it Honors. Now that we have that out of the way, Hilton has been in the running as one of the top hotel loyalty programs for a while. Their massive hotel footprint of 4,000+ hotels in 91 countries ensures that you do not have to struggle to find one of their branded hotels on any trip. All the way up to 2014, Hilton Honors was offering zero blackout dates to their reward program members. They also allow you to earn hotel and airline points during the same stay.

Hilton’s biggest devaluation (that I remember) was in 2013. They really shook things up by:

  • Adding Categories. They went from 7 up to 10 categories! Even with 4K+ hotels in 90+ countries, this was a blow to redemption enthusiasts.
  • Introducing Seasonal Reward Pricing. Redemption points required for free rooms began to fluctuate with seasonality and demand.

They have not implemented any major updates since 2013. Instead, they do a quarterly shakeup of their hotel categories.

Favorite Stay:
My best Hilton experience was at the Hilton Caribe in Puerto Rico. Massive infinity pool, old school hospitality, and a cool talking parrot in the lobby.

World of Hyatt (Previously Gold Passport)

Hyatt just went through a massive overhaul of their entire loyalty program. Hyatt Gold Passport is now called “World of Hyatt.” For a hotel brand with a relatively small footprint, they have some serious followers. Why? Their Diamond members get:

  • Upgrades to the best room available upon arrival (excluding suites)
  • Access to lounges featuring complimentary breakfast and evening hors d’oeuvres
  • Complimentary full breakfast in hotels without a club lounge (including Park Hyatts!)
  • Four suite upgrades every year
  • A special welcome F&B amenity during each stay
  • A dedicated reservations line

Wow! I think answered that question. So it’s no surprise that most of their top elites are not thrilled with the most recent changes. Here are two major updates:

  • New Status Tier. Hyatt Passport used to have two elite tiers, Diamond and Platinum. Now there are three: Discoverist, Explorist, and Globalist (none are typos). The loyalists getting demoted used the  hashtag on Twitter to make their feelings known. The “Stay Thirsty Elites” meme really made me laugh. I’d like to explain adding a whole new elite tier by using the airline example. First Class and Economy Class have now become First Class, Business Class, Premium Economy Class, and Economy Class (and even Basic Economy) – all in the exact same airplane! Mostly, they just moved the rows of seats around, and made minor changes in amenities. A new tier is never a positive upgrade for existing elites to any program.
  • Pay to Play. The old program allowed you to qualify for status based on # of nights or # of stays (stay = one check-in and check-out). You can no longer qualify for elite status based on number of stays. It’s gone. Instead you have to stay X number of nights or spend a minimum $ amount per stay. Wow, a revenue-based model…hmmm, I wonder where I have seen this lately? Oh yes! Here: Delta Airlines. Then here: United Airlines. And now here: American Airlines. I see what you did there, Hyatt.

Hyatt’s top-tier guests who used to get Diamond status just by staying 25 times (one-night stays) at any Hyatt now have to spend 60 nights at Hyatts to reach the same status. This completely changes the elite status earning game. Earning 60 nights with a relatively tiny footprint is not going to happen for a lot of their existing Diamond level members.

Since we are looking back to 2013 for most of the other brands here, in 2013 Hyatt did introduce a new super category for redemption. It’s not as drastic as what the others have done, but then Hyatt has a very limited number of properties (as of now).

Favorite Stay (Someday):
I am a huge fan of Bill Murray. While in Tokyo, I just had to visit the legendary Park Hyatt Tokyo. It’s an iconic property that I aspire to actually stay in one day.


Moving forward, earning elite status with a single hotel brand is going to be more difficult for a lot of people. I know many are still reeling from the Marriott-Starwood merger. However, please note that the M&A activity has not yet peaked in the hotel industry. Hold on tight, because I agree with the experts that there is much more to come. After reviewing five of the major brand loyalty programs above, I realize more than ever that I cannot be the only one with a razor sharp focus on location over brand. If the industry continues to see more devaluations and major changes, maybe the points and loyalty game will finally lose its appeal.