Starwood Hotels and Resorts recently announced new benefits to their loyalty program, Starwood Preferred Guest (SPG).  So what inspired the changes to the SPG program?  According to Frits van Paasschen, President and CEO of Starwood, just two percent of their SPG members generated 30 percent of Starwood’s profits.  The company then did a pilot with those travelers for three years to better understand their needs and their desires. (Yes, three years… how many  companies do you know that do a pilot aimed at improving a loyalty program for a week, yet alone for three years?!?)  From that program, their pilot group saw double digit share growth when compared to a control group.  SPG then took the insights from that study and is now rolling out the new benefits to all of their reward program members.

One of the benefits that they instituted is eliminating the industry standard 3PM check-in and noon checkout.  They are now allowing their most frequent travelers to control their own arrival and departure time within a 24-hour timeframe.  For example, a guest who checks in at 10PM does not have to check out until 10PM the next day.  This is a great benefit for anyone who works nights since the guest would be charged two nights under the old program, instead of one night under this new program.  The “Your24” program is available to SPG members who spend more than 75 nights with Starwood per year.

Starwood now offers individual personal ambassadors to those who spend more than 100 nights with them per year.  This service is more than just a “concierge.”  According to Starwood, it is a unique, personal, and individualized relationship between the member and one ambassador, who best understands their needs and preferences for each trip and then customizes their experience at each hotel property and stay.

One the most interesting new benefits to the loyalty program is the new Lifetime Status.   If you stay a total of 250 eligible nights and maintain elite status for 5 years, you are awarded Lifetime Gold status with SPG. SPG Members with a total of 500 eligible nights and 10 years of Platinum will enjoy Platinum status for life.  Compared with a competitor, such as Marriott, that offered Platinum lifetime status only after 12 years of membership and only after two million points earned in the program.  SPG Gold members now receive a welcome gift at check-in and can choose from bonus Starpoints, complimentary in-room Internet access, or a complimentary beverage at the hotel’s restaurant or bar.  Other benefits given to SPG Gold members include an automatic room upgrade (when available) and accelerated Starpoints earnings (three Starpoints for every eligible U.S. Dollar spent).

I like the fact that a company is trying to better understand, and reward, their most frequent and loyal customers.  And in turn, the new loyalty program is helping the company drive their own profits and growth.  It would be interesting to see if other companies follow Starwood’s initiative (or even trying to launch a three-year pilot program to better understand their customers).  However, I think most companies can benefit from asking what their customers want in terms of rewards and then tailoring a program that works for both their customers and the company.  I know this approach would work well with me!