Reference no: EM133046960

As technology has changed the way consumers search for and book hotels, hotel loyalty programs also have evolved. Road warriors, those who travel extensively for business, have traditionally favored one or two hotel chains to rack up points for rewards that today go beyond a free night's stay. With the primary goal of building a customer's affinity to a brand, hotel loyalty programs are designed to provide unique experiences and build deeper levels of customer engagement.

When travelers stay at any of Marriott's 19 affiliated brands, including Ritz-Carlton, Courtyard, Renaissance, and Residence Inn, rewards are earned in the form of points. These points can be redeemed for flights through more than 30 airline rewards programs, along with spa and dining gift cards. Statistics show that loyalty members are three times more likely to book a hotel directly with Marriott than through a third-party travel website. This also saves hotels the commissions paid to a third-party website for bookings.

When bookings are made through third-party websites, hotels do not give loyalty awards or points to its members. They're only awarded when booked directly with a hotel. However, many travelers are willing to jump around from place to place and forgo points for a better price. For business travel, some companies are even requiring that employee travel be booked through a favored third-party site.

As third-party websites become increasingly difficult to ignore, Marriott recently announced an agreement with TripAdvisor, which allows travelers to book rooms directly at any of Marriott's 4,200 properties without leaving the TripAdvisor site. The instant booking platform (with a "Book on TripAdvisor" button) provides a streamlined booking experience for travelers. However, to earn rewards points, Marriott requires that reservations still be made directly through its site. This new collaboration is a result of changing trends, greater price competition, and far more choices-which can result in less customer loyalty. The benefit to Marriott is greater exposure for its many brands and the ease with which consumers can book a room at any of its hotels without leaving the TripAdvisor website. The benefit to TripAdvisor is the additional revenue in the form of fees for more bookings at any of Marriott's worldwide hotels.

1. What led Marriott to enter into a relationship with TripAdvisor? Discuss how the relationship between Marriott and TripAdvisor benefits each company.