Marriott’s Acquisition of Starwood Hotels Beefs Up Advertising Might Combined company to have 30 hotel brands in its portfolio

Marriott International’s $12.2 billion acquisition of rival Starwood Hotels and ResortsWorldwide Inc.will create the world’s largest hotel company and a mightier ad spender.According to data from WPP research firm Kantar Media, Marriott International Inc. spent an estimated $96 million on measured media in the U.S. in 2014. Starwood Hotels and Resorts Worldwide, meanwhile, spent an estimated $55 million on measured media in the U.S. last year, per Kantar Media’s data. Kantar Media’s analysis includes ad spending on traditional media and online display, but doesn’t include other fast-growing digital ad formats such as online video or mobile.

Marriott is acquiring Starwood Hotels and Resorts, owner of brands such as W hotels.PHOTO: PATRICK T. FALLON/BLOOMBERG NEWS

 

The combined company will have 30 hotel brands in its portfolio. Marriott is the owner of brands including its namesake hotels, the Ritz-Carlton and Renaissance Hotels. Starwood, which has historically been a strong performer in the high-end hotel market, owns brands such as St. Regis, W and Westin.

In an interview with the Wall Street Journal, Marriott CEO Arne Sorenson said he liked Starwood’s marketing and mix of international properties and noted the combined company will be the “strongest” in the lifestyle space.

Starwood’s roster of “cool” brands such as W may help Marriott appeal to a younger generation of travelers, said James Fox, the chief executive of branding firm Red Peak Branding.

“Starwood has been really successful at engaging younger business travelers,” said Mr. Fox, pointing to the company’s embrace of social media in its marketing.

Starwood, for example, was among the first companies to use Instagram’s “Carousel” ads option. The hashtag for Starwood’s preferred guest program, #SPGlife, is mentioned in more than 55,000 posts on Instagram, while the hashtag for Marriott’s loyalty program, #MarriottRewards, appears in just over 3,000 posts on Instagram.

Hotels aren’t the only ones ramping up their push to grab young people with the travel bug. Airbnb, a home rental service, has been ramping up its marketing presence as it gains traction among travelers seeking more unique and often lower-priced accommodations compared to the rooms offered by traditional lodging players.

Airbnb, which launched its first global ad campaign earlier this year, has spent $18.9 million on measured media in the U.S. the first six months of the year, according to Kantar Media. In 2014, Airbnb spent just $5.1 million on measured media in the U.S., per Kantar Media’s data.

Marriott and Starwood noted that bringing their large loyalty programs, with 54 million and 21 million members respectively, “should be even stronger” when the two companies merge. From a marketing perspective, that means more robust data available on travelers.

“Travelers want increasingly personalized experiences, so having all that data is going to be critical,” Mr. Fox said. “If they can leverage that in interesting ways and reward loyalty in interesting ways, that’s going to give them a real competitive advantage against the other hotel chains.”

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