Recession-Era Ritz Offers Rewards Program

ritz carlton

The recession is still going strong, and while the stock market is clinging to a reasonable state of health, convincing consumers to spend their cash on luxury travel remains a challenge. And there has been no greater evidence of this trend than this: the Ritz-Carlton, traditionally the epitome of luxury hotel chains, has launched a loyalty points program that offers repeat customers free hotel rooms and other benefits, in partnership with credit card companies, airlines, and local businesses.

The timing of the launch is no accident: in the past two years, rooms at the Ritz have fallen from $297 to $358 due to lack of demand. Plus, fall is a traditionally slow season for hotels, meaning even more pain for the hotel giant.

The Wall Street Journal reported that the Ritz’s program will award one free night to visitors who have stayed 20 nights at a branded location, which may incentivize greater Ritz loyalty — though with each night costing $300, hotel patrons must rack up a $6,000 bill to get a single free night. And while there are still people wealthy enough to afford luxury travel, for the swankiest of all hotel chains to offer a points program may be a true sign of the shift in American spending habits.

Of course, there’s no guarantee that people still wealthy enough to stay at the Ritz will join the programs. According to the Survey of Affluence and Wealth in America 2010, which polled 2,400 people from the richest 10% of U.S. households, “More than 77% of respondents defined themselves as resourceful and more self-reliant [in 2010].” ABC News added that “overall consumer spending has slowed mainly because the richest 5 percent of Americans — those earning at least $207,000 — are buying less.” In short: the people who have the means to spend are not spending on luxury travel.

Marriott International, the brand’s parent company, owns a collection of more affordable hotel chains including Fairfield Inn and Courtyard by Marriott, both of which already have their own points program called Marriott Rewards, which lets users earn credit for future stays at Marriott locations.