business news in context, analysis with attitude

Yesterday I did a piece about how many hotels seem to be reducing services, either because of Covid-related restrictions or lack of staff, but aren't being transparent about it, and aren't cutting their prices.  I suggested that such anti-customer practices often are a mistake, and MNB reader Mark P. O'Brien responded:

We just returned from a two week fall vacation to New England.  We stayed in Marriott properties in Portland, Burlington, Lake Placid, the Cape area & Providence.

I’m retired so I don’t travel for business anymore but my wife and I were surprised at a few changes we noticed at Marriott properties.

Restaurant’s and bars closed due to not being able to find out retain staff. A general lack of staff. 

Lack of business travelers.  

Dogs:  It appeared to us that in order to survive Marriott has gone all out in welcoming dogs to appease the leisure traveler.  At times we felt like we were staying at a kennel at multiple locations.  One room we were given had what appeared to be a large amount of cat hair all over the bathroom floor. The door of the bathroom had what appeared to be cat scratches.  It looked like the cat had locked in the bathroom when the renter left the room.

My wife is allergic to cats.  In 5 minutes she was having reactions.  Front desk staff were good about getting us another good room but told us the room had just come off a month long rental.  We wondered how people with very severe pet allergies handle these changes? 

I hold Platinum Marriott status for what it’s worth but these changes have us questioning whether we want to remain with the brand.

Sounds like a classic case of a brand not being loyal to the customer.

Another MNB reader wrote:

This is a disaster-in-the-making move to appease the street with a story of permanently optimizing the business model to favor balance sheet considerations over the guest.

Earlier in my career I spent seven years while at Ogilvy & Mather as the managing director on what was then our largest client in the Seattle office, Westin Hotels & Resorts. The word hospitality was near biblical inside this organization -- a business largely dedicated to guest experience. Every aspect of operations was designed to enhance guest care and earn – in those pre-digital days – word of mouth endorsement. General managers in hotels were indeed Generals and had vast power to enact any move deemed necessary to enhance guest experience and bring the delivery of “hospitality” to life in ways that at times seems magical. This was woven into the DNA of operations which filtered down into ethos, belief system and daily activity throughout the organization.

If you commoditize your industry to “heads in beds” or butts in seats as is the case in the airline industry, you dilute the value proposition over time. This allows disruptors to innovate in your category, come forward with guest centric solutions that will win hearts every time and steal your customers. Not surprised by this move. We can now observe the steady decline over time.

MNB reader Rich Heiland wrote:

My wife and I went to the Poconos last weekend. Hotels, even out of season, would have been in the $125 range for something comfy and decent. We got a small AirBnB cabin for $79. Had to make my bed and cook breakfast, but for nearly a $50 difference, and a more atmosphere, why not? Hotels seem to be acting like they have no competition. 

And, to be fair, MNB reader Steve Workman has had a different experience:

I am a Diamond Club Member with Hilton properties.  I have been traveling throughout the pandemic and have seen the adjustments made to the “Free” Breakfast and other amenities.  The most important thing to me when I stay at a Hilton property is that I feel like a Diamond Club member during my stay.  If you travel enough and patronize a particular chain enough, you deserve some recognition.

In my mind, Hilton has found a way to do that.  When I arrive, my “Diamond Member” parking space is still there.  When I check-in at the front desk, although I usually prefer the Digital Key option on the App, I feel welcomed and I am offered a choice of beverage, and snacks.  I am also offered daily cleaning of my room if desired, which I usually pass on because I think I can manage with not having my room cleaned and bed made for the 2 - 3 days of my stay.  I am also offered a $12 credit for breakfast daily for each adult staying in my room.  This is their way to avoid the contact of everyone at the “Free” breakfast section and yes I am sure it also involves a shortness of staff.

Either way, when I arrive and leave there Hilton property, I feel like I am acknowledged for my status, which is really all I need.  I also receive a survey after each stay, and that is always one of the questions on the survey. “Did you feel welcomed as a Diamond Club Member during your stay?”  In my opinion, Hilton has figured it out.  Not sure about the other Hotel Chains, as I am partial to Hilton.

Responding to my assertion that Instacart is actually disintermediating traditional retailers from consumer relationships, in part by going directly to manufacturers for deals and promotions, one MNB reader wrote:

I had this conversation yesterday, so it is interesting that it comes up here.  Retailers have a lot of power in the selling process and are a key role in connecting to the consumer.  However, that power by many, has been abused over the years through very unacceptable and exorbitant practices, all on the threat of the manufacturer of being delisted.  Now there is a new player in town that manufacturers are seeing the benefits of.  Retailers are becoming less important as e commerce grows.  Imagine what would happen to prices if, there were no slotting fees, no ad fees, no reset fees, no processing fees, and many other etc. fees,  if all these were to be directed toward actually driving sales.  A majority of retailers of today have positioned themselves solely as an expensive conduit to the consumer, which will not bode well for them in the future. 

And, on another subject, from MNB reader George Denman:

I can’t tell you how excited I am to hear that Dorothy Lane Markets has finally penned a deal to open their 4th store right here in Mason, OH. This is a stone throw from Kroger’s Arbor Square store, an upscale Walmart location, and a Whole Foods location. I have always been a big fan of DLM, from their award winning customer service ( no self-serve scans there) to some of the finest cuts of meat in the market to their Killer Brownies to my all-time favorite, Asiago cheese flute bread. I stopped at the Washington store location earlier this week, which for me is a 30 minute drive, to pick up the bread and one of their homemade 4 berry pies. I brought the pie into our Graeter's corporate office to share yesterday, always a risky move given Graeter’s has its own bakery, but the team enjoyed the delicious treat. Now if you like no-bake cookies DLM has them in both chocolate and peanut butter versions.