When it comes to transparency, I’m a true believer.
Give consumers all pertinent information, in accessible form, and the free market will reward those companies that provide the best products and services at the lowest cost. Lousy companies will fall by the wayside.
Sure, it’s a bit more complicated than that. But insofar as Adam Smith’s “invisible hand” does work to ensure a positive outcome for consumers, it does so only to the extent that transparency prevails.
In the case of loyalty programs, transparency would mean that consumers have access to all programs’ performance data, in particular how well each program delivers on the promise of free trips, upgrades, and the like.
That’s hardly the case today, and won’t be any time soon.
Starwood’s Ratings & Reviews
While only indirectly related to loyalty programs, Starwood has embraced transparency with a move as surprising as it is heartening: With the newly launched Ratings & Reviews, Starwood Preferred Guest members can now post reviews of their hotel stays on Starwood websites, where they will be available for all to see.
Unlike most hotel review sites, Starwood reviews may only be posted by those who can show that they’ve had a stay at the property in question within the past 18 months—before posting, reviewers must provide their Preferred Guest credentials or the reservation confirmation number of the stay to be rated.
And no reviews for a particular hotel will be displayed until at least five reviews have been posted.
Those requirements should go a long way toward ensuring a balanced assessment by travelers who are in a position to make informed judgments.
Another Hotel Review Site, Not
It’s not as though there aren’t plenty of first-hand hotel reviews already available to help travelers make informed decisions about which properties are worth booking and which should be avoided. There are.
But a hotel company posting unedited reviews of its own properties, good and bad, on its own website?
Travelers aren’t the only beneficiaries here.
As Starwood’s management no doubt knows, the reviews will inevitably have a positive effect on the company’s overall quality.
Over time, glowing reviews will promote more of the behavior that gave rise to the positive feedback. And negative reviews will exert pressure on underperformers to address their deficiencies.
In theory at least, this is a virtuous circle, with better service generating better reviews, which in turn spur even better service, generating even better reviews, and so on.
This was a gutsy move on Starwood’s part. And a smart one.
Reader Reality Check
Do you take time to write hotel reviews?
How important to you are user reviews when deciding which hotels to book?
This article originally appeared on FrequentFlier.com.