In the travel industry, some brands work very-very hard to limit the amount of time when CEO’s are available to the press. Despite being the highest paid person on the team, they have a tendency to speak inside baseball, or often to sincerely piss off their key customers.
British Airways did this for a while with former CEO Alex Cruz, which I considered to be a mistake. The leader was charismatic and would respond with facts and figures when challenged, to show customers where his thinking was.
With Marriott Hotels new CEO, Tony Capuano, I now totally understand why press teams hold CEO media availability back. Just about everything the incoming leader recently expressed makes me want to run from Marriott like a sinking ship, despite enduring affection for the brand.
For a start, he thinks customers have short memory, thinks it’s great that Starwood was a better program than the program he now de-facto leads, and doesn’t like how much hotel employees are paid. Talk about a week of soundbites.
Marriott CEO Prioritizes Hotel Owners Over Guests?
Tony Capuano, the new Marriott CEO sat down with long term travel industry veteran, Scott Mayerowitz of The Points Guy (TPG), to discuss just about everything going on with Marriott these days.
The idea was to touch on how his time at the helm will build on what his predecessor, the much loved Arne M. Sorenson, created.
Sadly for Marriott, the conversation didn’t go well. Well, maybe it did for shareholders and hotel owners, who together seem to represent the only people incoming CEO’s are concerned about these days, but not so much for guests.
You know, the people who actually pay hotel bills, devote loyalty, get credit cards, create revenue – and all that jazz.
And that’s a great reminder to most hotel guests: hotel chain CEO’s are appointed to drive share price up and keep franchisees of Marriott properties happy. Marriott rarely owns the Marriott branded hotel you’re staying at – they just provide a marketing and sales platform for owners to plug and play. Keeping owners happy is priority over guests.
Starwood Preferred Guest Was More Generous Than Marriott Bonvoy
Capuano openly admits that Starwood Preferred Guest, one of the better hotel loyalty program in modern history, which Marriott purchased, was much more generous than his Marriott Bonvoy program. He has no intention of changing that.
Speaking to Mayerowitz, Capuano offered a striking rendition along the lines of we have more hotels, so that makes up for the fact that we’re not as loved and don’t ever plan to be that generous again. Perhaps that’s why Marriott all but closed down the Ambassador program earlier this year?
“The integration of Marriott Rewards and SPG was a monumental task. And it’s quite interesting. You hear SPG loyalists say, ‘My goodness, what have you done to our program?’ The program was very guest-friendly. It was less owner-friendly.”
“What some of those SPG loyalists may have lost, a bit, in terms of the richness of the program, we hope that breadth of choice, whether it be brands or geography, is a bit of a mitigating factor,”Marriott CEO, Tony Capuano
So basically, if I understand correctly, the statement expresses something along the lines of “we have more hotels, so hopefully that makes up for them being less friendly to our most frequent guests.”
Just last week, Capuano blamed a labor shortage at Marriott Hotels on the notion that Amazon pays people too well. The CEO received $9 million in salary during the covid-19 pandemic, with inevitable stock grants and options on top.
He’s hoping to reduce Marriott’s hotel operating costs with cheaper labor, and his comments appear to suggest that he doesn’t like that businesses are paying people living wages for entry level jobs, because it’s making it harder for him to produce cost savings to justify his $9m salary.
Don’t Worry, There’s More
If the comments are rubbing you the wrong way, just wait, there’s more. Capuano, as flagged by View From The Wing offered a lovely requiem of Marriott Customers, who are apparently best described as having “short memory”.
“I just spent two days with my leadership team talking through a bunch of these issues. I’ve described this phenomenon as the friction that exists between the short memory of our guests and the long memory of our owners.”
…“And because of our short memories, you want everything to be the way it was. You want the restaurant open the hours that it was open before. You want the spa open with all the treatment rooms and all the technicians available. You want full service at the pool. You want daily housekeeping. You want all those things. And, in a way, that’s good because it means our consumers are anxious to get back.”
“At the other end of the spectrum, our owners and franchisees have borne a disproportionate weight, from the impact of the pandemic,”
“They’ve lost billions of dollars of revenue. Suggestions about getting back to ‘normal,’ they look at you like you have three heads and they say, ‘You’ve got to be more sensitive to the steep climb we have in front of us.’”Tony Capuano, CEO of Marriott Hotels
It’s not wrong to feel for the franchise owners of Marriott Hotels, but the cart before the horse question comes to mind. What comes first, a recovery, or a hotel experience worth enjoying? For discretionary travelers, there’s no point in taking a trip when the pool is closed, dining is a limited experience and other things are too.
To that score, Marriott and many of its franchisees were among hotel groups which received billions in payroll aide and other financial benefits from the United States Government.
Maybe I’ll Buy Marriott Stock?
As a hotel customer, and typically someone who stays more than 100 nights away from home in a given year, I’m having a very hard time swallowing these words and directional visions. The avid capitalist in me loves them though.
Anyone who willingly displays such disregard for customer friendly policies while championing cost cutting and the prioritizing of owner costs and share price over any resemblance of guest satisfaction (during an interview with a customer centric website) is bound to drive a stock up.
Unless, of course, all the guests stop staying in Marriott hotels, and Airbnb gains a greater market share. Then, Marriott, shareholders, and franchisees would have a very large problem. It’s funny how that balance can work.
You’re a jerk. Ridiculous spin on this story.
Hah what spin? I didn’t say any of those things which Marriott’s CEO did. He did.
I’m not sure why anyone would be surprised by these comments. They were meant to appease shareholders. Shareholders keep him as CEO, not customers. Marriott isn’t going anywhere no matter how much folks dislike Bonvoy. So yeah, buy some Marriott stock.
Well, I think it’s not surprise in the meat and potatoes of the concept. I certainly understand the economics and priorities of a hotel CEO, but when a CEO reminds consumer focused resources that they don’t come first, or second, it’s a pretty bold way to operate.
I don’t believe the questions were even intended to draw out controversial responses, so it just says a lot about the thinking of senior leadership there.
Will Marriott lose business because of his statement? No. He said what the CEO’s of Hilton and Hyatt are afraid to say. They don’t care about customers either. They care about the bottom line, which is money.
Because of the statement, likely not much. However, creating a culture where franchise owners feel confident and empowered in ignoring brand standards or elite benefits absolutely can cost money. I’ve seen it many times before.
I have been a fan of Marriott Hotels for years. The previous CEO and his policies made me feel special. The new CEO has not made any welcome to me as a customer. No letter of hello, no positive news that would make me feel that Marriott wanted to improve customer relations and no enhancements at the hotels does not seem like the Marriott hotels that I once knew. Sad. I hope this changes as I have enjoyed staying at these hotels…in the past.
As someone who spends a significant time on the road and exclusively stays at Marriott properties, is it worth exploring a different rewards program?
Would other properties be willing to transfer equal status into their rewards programs?
Yes indeed, ask Hilton to do a status match, you will have to meet some stay requirements. Or get one of the Amex Hilton cards that include status levels up to platinum! Including free breakfast and upgrades. Won’t find that with Marriot…
I’m one of the 850 Marriott Marquis workers in NYC. We were terminated back in December, right at the beginning of the holidays! Most of us have decades with Marriott. They decided to outsource our jobs to a management company. They went with cheaper labor! So anytime you go back you won’t see all the friendly faces you are used to. It’s terrible that they received all the help from the government and we were thrown out. He still got his bonus.
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