# Starwood vs. Marriott -- Jim Cramer CNBC



## YYJMSP (Apr 1, 2011)

A bit of an analysis/comparison yesterday by Jim Cramer on CNBC ("Mad Money") of why Starwood (the hotel company) is better than Marriott (the hotel company).

http://www.cnbc.com/id/15840232?video=3000014197&play=1

My favourite tidbit was that SPG members accounted for 50% of room nights in 2010 at Starwood properties (up from 34% in 2004)


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## saluki (Apr 1, 2011)

YYJMSP said:


> My favourite tidbit was that SPG award nights accounted for 50% of room nights in 2010 at Starwood properties (up from 34% in 2004)



I did not watch the video yet, but I find this statistic extremely hard to believe. 50%???


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## LisaRex (Apr 1, 2011)

saluki said:


> I did not watch the video yet, but I find this statistic extremely hard to believe. 50%???



Me, too.  The hotels wouldn't be making record profits if this was the case!


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## jarta (Apr 1, 2011)

I did watch the video.

What Cramer said is that SPG members account for 50% of Starwood's hotel revenue.  He said it as a tribute the ability of the  Starwood's loyalty program (SPG) to generate revenue for the company.  Starwood is kicking Marriott's a** according to Cramer.

Cramer said nothing about SPG awards (freebies) that Starwood SPG members get by staying at the Starwood hotels.   ...   eom


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## YYJMSP (Apr 1, 2011)

jarta said:


> What Cramer said is that SPG members account for 50% of the Starwood's hotel revenue.  He said it as a tribute to Starwood's loyalty program's ability to generate revenue for the company.



SPG awards must have been on my brain -- I've changed my original post.  Thanks for the catch!


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## jarta (Apr 1, 2011)

However and despite the accepted Gospel on TUG, the SPG awards must have value to SPG members if they account for 50% of the hotel revenue.

I'm sure glad I am 5* Elite and SPG Platinum for life.  It has saved me about $10k in air fares in the last two years alone.   ...   eom


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## timeos2 (Apr 1, 2011)

So all that means is 50% of the revenue is being paid by SPG members. Doesn't speak to what those members get out of it in any way shape or form (but does hint that they at last think there is a value so they join/spend money at Starwood Hotels. I tend to be the same with my Hilton Rewards but the aren't going to book much money despite my loyalty to that system).  It is interesting that they get that high number of user members but that's all it is. And certainly has no impact on the timeshare side of things.


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## DebBrown (Apr 1, 2011)

I'd pick SPG over Marriott any day.  Unfortunately, there aren't always affordable SPG properties where I travel.  My second choice is Hilton, then Marriott.

Deb


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## jarta (Apr 1, 2011)

"And certainly has no impact on the timeshare side of things."

When I can get free upgrades at Starwood hotels, where else would I stay?

As for the value of the rewards and their link to timeshares, I took my 2009 StarOptions from a timeshare week at Langunamar and transferred them into SPG Starpoints.  The 2009 MF at Lagunamar was $1,200.  I then transferred out the Starpoints to my SW airlines account.

That use of $1,200 got me 6 award round trip flights anywhere SW goes.  Plus, I got a 1 year companion pass for my wife to travel on the same SW flight I travel on for free.  So, the $1,200 investment was turned into 12 round trip SW flights ($100 per round trip SW flight).  We are using my award round trips to pay for trips to our home and traded via Starwood timeshares in California and AZ.

And, that's not all!  (Do I sound like Ron Popeil?  lol!)  This month I'm going on SW to visit friends in NYC.  Next month I am going to LA (Burbank) on SW to visit my daughter who recently moved there.  In June, my wife and I are taking advantage of 3 free nights at Wynn in LV by flying out on SW.

In each case, I paid for my single ticket and my wife didn't have to pay anything for her ticket.  The companion pass lets her go for free (except the $2.50 per leg Homeland Security tax).  The companion pass doesn't expire until December 31.  So, what's the total savings?  Thousands of extra dollars so far for an investment of $1,200.

(BTW, in the past 2 years I have purchased 5 round trip business class tickets to Istanbul for us and friends using StarOptions converted to other air mile programs.  Total savings on the 5 tickets was about $25K off list after the cost of the StarOptions I converted. $2K value in MF in; $7k per ticket for normal airfare) 

And it all was made possible because I am Starwood 5 Star Elite and SPG Platinum for life.  I can't wait for this year's opportunity to work/scam the system for my benefit with the help of Starwood advantages.     But, it's not very popular to say things like this on TUG.  Most TUG posters say the advantages aren't worth it.  Little do they know.   ...   eom


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## DanCali (Apr 2, 2011)

jarta said:


> "And certainly has no impact on the timeshare side of things."
> 
> When I can get free upgrades at Starwood hotels, where else would I stay?
> 
> ...



Jarta - a lot of the stuff you write and "savings" amount are debatable. Comparing a business class award ticket with full fare refundable business class is not exactly "apples to apples"...

But my biggest question is what exactly was the incremental benefit from being 5* Elite? Couldn't anyone who converts a timeshare to SPs (or earns SPs on their Amex) get the same trips on SW and business class tickets?

5* Elite gives you a 10% bonus on SPs - and saves you $79 (?) of the conversion fee. So shouldn't the "thousands" in savings due to SP conversions be multiplied by 10% if you want to attribute to the benefits of 5* Elite?


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## Ken555 (Apr 2, 2011)

DanCali said:


> Jarta - a lot of the stuff you write and "savings" amount are debatable. Comparing a business class award ticket with full fare refundable business class is not exactly "apples to apples"...
> 
> But my biggest question is what exactly was the incremental benefit from being 5* Elite? Couldn't anyone who converts a timeshare to SPs (or earns SPs on their Amex) get the same trips on SW and business class tickets?
> 
> 5* Elite gives you a 10% bonus on SPs - and saves you $79 (?) of the conversion fee. So shouldn't the "thousands" in savings due to SP conversions be multiplied by 10% if you want to attribute to the benefits of 5* Elite?



I agree. It's easy to take retail value of travel expenses when paid via points and assume it's a great value. This has been discussed repeatedly over the years on TUG, and I'm sure will always be so.

To add a bit of flavor to this topic, I'm trying to buy two one-way business seats back from Europe this year and one of the options I found is to purchase seats from a 'wholesaler' who actually is reselling award seats. Yesterday I was offered a first class seat for $1950, when retail is about $7500. I only want business class, but business class retail is $2900 so the $1950 for first class is a savings. I suspect these award seat resellers may more accurately show the true value of award seats, should you not have the points/miles to acquire them yourself. Note this is still more than MF on a timeshare week, so there likely is good value in converting SOs to SPs with the intention of using for business/first international travel.


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## timeos2 (Apr 2, 2011)

People love to create situations that support them "winning" at the game. If it really were possible to easily get more than $1200 out of the fees then Starwood would be going broke. They cannot give everyone more benefits than they collect income for & that doesn't account for overhead expenses (which they most assuredly collect!).  Jarta may do "ok" on average but I think is kidding himself if he thinks he's getting far more than he puts in. I notice there are not a bunch of others saying the same thing which should happen if it were a common benefit.  I'm glad he's happy but if he ever really studied whats out there he'd discover the saving he's claiming thanks to the program just aren't as great as he states. If they are it's a first & there are a bunch of owners that had better get on board!


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## jarta (Apr 2, 2011)

DanCali,   ...   I know that instead of spending $7,000 for a ticket I spent about $2,000 in converted MF.  To me, that amounts to a $5,000 per ticket saving - or $25,000 for 5 tickets.

The full value of the SW companion pass cannot be determined until the end of 2011.  But, it's at least the value in savings on 12 round trip tickets where the SW discount fare is more than $100 per round trip.  (Have you checked the SW "Wanna Get Away" lowest fares lately for each leg from Chicago to LA or LV?  I have.  I guess you think you can fly round trip like that for close to $100?  ROFL!)

[Rude personal remarks deleted - stick to the topic, or don't post. - DeniseM Moderator]

Starwood SPG -* if utilized the right way by the right type of traveler* - has MASSIVE benefits.  You may not be the right type of traveler to be able to make use of those benefits.  But, just because you cannot make use of the benefits, don't come on TUG with fuzzy math to "prove" they have no value.  

And, I was not even talking here about 5 Star Elite benefits other than StarOption conversion to Starpoints and then out to an air miles program.  Those benefits also have value - but mainly in ease of terms of making reservations where you want to go when you want to go there or getting minor, but satisfying, perks like early check-in and late check-out.   ...   eom


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## jarta (Apr 2, 2011)

"I'm glad he's happy but if he ever really studied whats out there he'd discover the saving he's claiming thanks to the program just aren't as great as he states. If they are it's a first & there are a bunch of owners that had better get on board!"

I think you need a flyertalk fix.   ...   eom


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## YYJMSP (Apr 2, 2011)

timeos2 said:


> I notice there are not a bunch of others saying the same thing which should happen if it were a common benefit.



In general, I agree with the savings/value that jarta is bringing up as examples -- we find we get the same.

But, before we start this whole war again of conversion values, etc, it all depends on how you use the points, and the values have to be taken with a small grain of salt.

I find we are staying in more expensive places, going in more expensive ways, etc, which we may not have actually paid for if we didn't have the points; however, on the other hand, we are still getting the full value of those more expensive places, etc, so I think it's perfectly reasonable to consider that as the value of what you're getting for your points.

It doesn't matter if you get the value from using your SVO ownership, or converting it SPG points, or converting it to airline points, or earning it on a credit card (points or cash-back), the bottom line is that you're redeeming those points for something of value.

More often than not, the value you get for the lowest number of points redeemed isn't as good a deal as redeeming for say 20% more points for something "worth" twice as much -- economy airfare vs. business/first class airfare is a good example of this, but so are standard SPG rooms vs. Specialty Select upgrades.

And with SPG rooms, make sure you stay in multiples of 5 nights, to get the most value out of the 5th night free when booking with points -- that's a 20% off discount right there (plus whatever you save in taxes) vs. paying for the same room.

It all comes back to how you work the system.


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## timeos2 (Apr 2, 2011)

YYJMSP said:


> In general, I agree with the savings/value that jarta is bringing up as examples -- we find we get the same.
> 
> But, before we start this whole war again of conversion values, etc, it all depends on how you use the points, and the values have to be taken with a small grain of salt.)
> 
> It all comes back to how you work the system.



Agreed. All too often the "value" is found by pricing things that otherwise wouldn't be used (too much $$ to represent good value). So it is a nice perk to get those upgrades but pricing them at basically full price represents a false "savings".  Yes, you get better seats or early check in or whatever, but if you seriously look at the true value you are usually going to be at or well below what you are paying in fees to get it. Sure it feels better to use the rack rates for comparisons which make it seem to be a big savings, but few of us would ever pay those rates as we know it isn't worth the big difference.  Again the companies do these things to make - not lose - money so they aren't going to give things away.  

It's nice to get the perks but they aren't free and usually are overvalued by both the source and the user.


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## spuppy (Apr 2, 2011)

While it is certainly true that starwood  "cannot give everyone more benefits than they collect income for & that doesn't account for overhead expenses", that does not preclude a minority of users from getting more in benefits that starwood collects from them in income.  That is what web sites like flyertalk are all about.

Also, I would suggest that the comment "but if he ever really studied whats out there he'd discover the saving he's claiming thanks to the program just aren't as great as he states" is somewhat condescending and does not address the point at hand.  Rather than suggesting that Jarta should study more, your argument would be more persuasive if you demonstrated more specifically why the benefits he quoted are worth less than $1200.



timeos2 said:


> People love to create situations that support them "winning" at the game. If it really were possible to easily get more than $1200 out of the fees then Starwood would be going broke. They cannot give everyone more benefits than they collect income for & that doesn't account for overhead expenses (which they most assuredly collect!).  Jarta may do "ok" on average but I think is kidding himself if he thinks he's getting far more than he puts in. I notice there are not a bunch of others saying the same thing which should happen if it were a common benefit.  I'm glad he's happy but if he ever really studied whats out there he'd discover the saving he's claiming thanks to the program just aren't as great as he states. If they are it's a first & there are a bunch of owners that had better get on board!


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## jarta (Apr 2, 2011)

[Have a nice day, Jim. - Denise M Moderator]


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