Here’s How Marriott’s CEO Defends Resort Fees

Filed Under: Hotels, Marriott

This past week, DC’s Attorney General filed a lawsuit against Marriott regarding their resort fees. This is something that many consumers have been pleased about, given the frustration largely associated with the spread of these fees (known as resort fees, facility fees, destination fees, etc.).

How Marriott’s CEO defends resort fees

In an interview with LinkedIn, Marriott CEO Arne Sorenson shares his take on resort fees following the lawsuit. Not surprisingly, he defends them:

In case you don’t want to see the video, here’s a rundown of his argument:

  • He argues that resort fees are the hotel industry equivalent of baggage fees in the airline industry
  • He says that when resort fees started a bit over a decade ago, of course they were somewhat financially driven, but it was a way to include things like paddle boarding and bikes with the room rates
  • He thinks that resort fees are well disclosed
  • Marriott’s approach is that these fees must include a package of benefits that is a multiple of the cost of the fee, and in many hotels that may now include a food & beverage credit, which is often equal to the fee itself
  • These fees aren’t going away, but Sorenson acknowledges you can only add these in some markets and some hotels, and not in suburban markets where there may be very limited features they can add

Obviously I strongly disagree with Sorenson, though I at least have to give him credit for not entirely painting these fees in a rosy light. He acknowledges that people might not love them, etc., which is more than the Hotel Association of New York will acknowledge, for example.

Why I disagree with Marriott’s CEO

Marriott’s CEO isn’t offering a very consistent argument here, in my opinion.

First of all, there’s a huge difference between airline baggage fees and hotel resort fees. While most people don’t like airline baggage fees, the difference is that they’re not mandatory — you can choose whether or not you want to check bags. That would only be a fair comparison if resort fees were optional.

Second of all, let’s give Sorenson the benefit of the doubt in claiming that when these fees were first introduced, they were designed to offer value-add amenities like paddle boarding and bike rentals. I think the motivation was entirely profit-driven, but whatever…

How can he defend that logic with the spread of these fees to cities, though? We’ve seen the introduction of “destination fees,” “facility fees,” etc., at a countless number of city hotels.

For example, these have become commonplace in New York City Marriott properties, where the most common destination fee is $30 daily. What do people get? A $30 daily food & beverage credit, enhanced internet, and one tour ticket.

Internet is already included for most guests and I doubt many people are taking advantage of the tour tickets.

So to me this boils down to charging an additional $30 daily for a $30 hotel credit.

Why not just make it a daily $200 destination fee, and include a $200 credit? Surely guests will appreciate that value as well?

This isn’t a unique value add, this is just a money grab:

  • Most people would much rather spend money outside of their hotel in NYC, rather than in the hotel
  • Typically the credit has to be consumed on a daily basis, so you can’t even “bank” it over days
  • Really it’s a way for the hotel to get people to increase spending with them even more, since rarely are people going to spend exactly the credit amount

Resort fees as such are bad enough. But to defend these types of fees in cities, where they’re basically just giving you a hotel credit, is a totally different story. There typically are no unique, valuable features added. They’re just jacking up the room rate.

(Tip of the hat to View from the Wing)

Comments
  1. If any of this was true, these fees would be optional. As none of this is even remotely true, it is nothing but a ripoff.

  2. he is the CEO, what else is he going to say?

    I sure hope the A.G.’s are able to end this dishonest practice.

  3. How many times have you seen a resort fee that gives you the same amount of credit at a hotel restaurant? Never have I seen such a thing, and very rarely have I seen resort fees include food credit. Normally it is premium internet, which I supposedly get as a hotel elite, bottled water, same, newspaper (read on my phone), 10% off some high priced tour and small discounts at local overpriced shopping malls.

  4. As long as the market allows… and they disclose they can do whatever they want.. IF you hate it, stay somewhere else. If you hate all the airline / hotel fees , don’t travel. The funny thing about these blogs is everyone reading is a huge hypocrite. Most of them will go into their office tomorrow morning finding ways to rip people off or screw over their employees.

  5. For supposedly a “smart” person, Arne is pretty dumb.

    If I don’t check bags, I don’t pay the bag fee.

    So, If I don’t use resort amenities, then Why should I be charged resort fees? I’m actually subsidizing the users…..no bueno.

    I also don’t use housekeeping, so where is my credit for not using those resources?

    Marriott is using typical consumer behavior to their advantage…in that most people won’t make a stink about $30 and just move on.

    Similar to how blockbuster video preyed in behavior for late fees, resulting in 80% of profit were derived from late fees.

  6. If he’s going to defend it, he should be forced to advertise it in the room rate and, where applicable, give the public treasuries a cut of the action.

  7. I love how the hotel industry manage to create these charges and people just go with it.

    “But it is such an aspirational property…” lol

  8. My post on this hat tips TPG which, unsurprisingly I suppose, mentions the baggage fee argument but doesn’t even offer pushback on it.

  9. TPG is a shill for Marriott, hotel chains, airlines, and most of all, banks. His level of journalistic integrity is absolutely zero. Giving him a hat tip is like giving Sean Spicer or SHS a hat tip.

  10. Please can we have some discussion on people’s actual experience requesying/demanding exemptions from these fees? My only experience with them was Marriott Fallsview Niagara Falls Ontario (jurisdiction Ontario, Canada) where I noticed the charge before checkin, contacted the hotel demanding it be removed and they agreed, saying it was an “automatic” but not “mandatory” charge. What happens when one does the same in an urban USA property? Surely we’re all doing this, what results are we getting?

  11. It’s very simple. Added amenity fees should be optional and a la carte, just like airlines. I don’t need access to your gym. I don’t need your WiFi or your entertainment option. I don’t need your water bottles or delivered newspapers. I don’t need your local phone calls. Other folks who want that can certainly pay. If I don’t want your mandatory amenity, dude, I should not be forced to pay. What don’t you understand?

  12. This is one more — of many — sick piece of newspeak gouging.

    How do we fight it? They are big and we are generally hamstrung by these stinking, awful, distorted, sly, expensive details.

    What is the best approach?

    I have already severed my connections with SPG/Marriott, but they will not notice with 3 billion people a year traveling.

  13. If Arne *really* wants to equate resort fees to checked bag fees, then he needs to start waiving them for co-brand credit card holders.

  14. They kind of make sense at an actual resort where there are a lot more activities that guests presumably want to use, but at a city hotel where people are just looking for a room they are ridiculous. Either way, the comparison to airline fees is totally different since those are optional (sure they include things that a lot of people want and end up paying for, but you don’t have to pay for them if you don’t need them).

    I don’t have a problem with the resort fees per se. Hotels should be able to charge people whatever they want. The problem is that these are both mandatory and often undisclosed even when you confirm your room booking. Either allow people to opt out of the fees and not get whatever “services” they provide (I bet most people would still be willing to pay the fees at resorts) or add it to the room rates so people know what they actually are paying upfront. Otherwise it’s just a shady bait and switch to lure people in with a supposedly lower room rate than they think they are paying. It hurts consumers and also allows them to compete unfairly with hotels that don’t play games like this.

  15. For a travel site everyone here is really simple.

    Fees banned in Europe? What are the hotel prices compared to the US? What are the taxes and other fees included?

    Don’t like it, stay somewhere else. It’s amazing how everyone cries for the government to stop a private company from charging what they want. Pathetic.

  16. Just imagine if the hotel industry had to advertise their prices all-in like the airlines (taxes and fees included). Think the CEO may want to rethink this ill conceived comparison.

  17. Are they, in fact, mandatory? All of you above, have you contacted the property before checkin demanding its removal? I’ve only one single experience, so I’m interested in how “mandatory” these ScamCharges really are. Anyone?

  18. I recently wanted to book a hotel in nyc for a one night stay. Just wanted a place to sleep. I was not aware of these so called resort fees. When trying different travel sites and potentially book a room, when I saw what the total would be I was shocked. On average, with local taxes, the resort fee added an additional 40-60 dollars. I finally found 1-2 hotels in nyc that do not charge resort fees (after digging around) and was successful! Got a petite room at the Washington Jefferson hotel for just $100.00. No need to stay at the Plaza. Budget would not allow such a thing.

  19. If the resort fees are like baggage fees then I’m guessing that they are optional, right? Oh? I guess not…

    Back to school, Mr. Ceo

  20. Airlines also given elite status holders no baggage fees. I spend 60-70 nights a year at marriott and don’t get the benefit of waived resort fees. At least Hyatt gets that point.

  21. Im going to use my last 100k Marriott points this December and then it’s Bonvoy out of there forever! These hotels are super overpriced and severely overrated – all of them.

  22. A resort fee would be like a mandatory airline seat belt fee.

    I prefer they include the resort fee in the room rate. If they want to have paddle boats, then have a boat rental fee.

  23. I have voted with my dollars. I went from 50+ paid SPG nights per year to 0 nights since the integration of SPG and Marriott rewards’ programs. I move those nights to Hyatt and I now enjoy a better rewards program plus no resort fees with my Globalist status.

    Good riddance, Arne. I hope your board and stockholders see this.

  24. DenB®
    I don’t think they are mandatory. I have always refused to pay them in the U.S.
    After a little scandal, they always take it off the bill. Always.
    Then again, i am not American)) I don’t ever leave tips, i demand suite upgrades in Hilton, haha) Use common sense, don’t easily agree on what companies want from you. Take a stance.

  25. I hate resort fees.

    I do understand what Mr.CEO is trying to say when he compares with bag fees. It’s a polite way of saying we (hotels and airlines) are a**holes doing a quick cash grab because we can.

    I don’t mind these stupid fees, it’s just like fuel surcharge (should have compared to fuel than bag), they can call whatever and charge whatever all they need to do is show it in the final pricing not leaving the math out in the fine prints.

    It is a cost of staying, just include everything in one number.

  26. Pardon me, if already mentioned … the cost of any food & beverage items at a hotel are inflated. So a $30 credit doesn’t go far and the hotel still makes money because they dont pay the amount they charge guests for the items.

  27. I just spoke to the Hotel Edison in New York. I asked them if they could waive the resort fee since I will only be staying on night. The woman told me that it was “mandatory”. She told me that this fee covers only conference room use and work out center. Does not cover parking or food.

  28. If you pay for your hotel stays yourself rather than traveling on an expense account, just don’t stay at any hotel that charges these scam fees. You can always find somewhere. I am not the sort of person to make a fuss about 30 dollars a day and demand it be removed, I just stay somewhere else.

  29. He can argue all he wants, but these fees are just an extremely deceptive way of padding the profit margin. What BS!

  30. Lol.. Rich fee collector defends fees that make him rich.. This is my shocked face.. Let’s also recall that hotels anc corporate in general has never given a damn about you or the environment until they figured that if you believe your helping, you’ll skip room cleaning and sheets and towels a few days, adding to their bottom line..

  31. The st regis New York actually imparts decent value for its fee, since its bar is a must-visit! And when the food and bev credit is combined with platinum breakfast, you can spend 140 at breakfast!!!

  32. Many if not most of the Marriott hotels in the Far East and Middle East offer you a decent discount if you eat at the hotel, this does encourage me to take the offer, I’m not forced to do so unlike these resort fees which are forcing me to eat to use it.

    I just avoid any hotel with these fees unless they are optional.

  33. I have read that resort or destination fees are 100% pure profit for owners, which means Marriott doesn’t get the revenue like they do off the nightly room rates. Maybe Marriott defends the fee on the basis that its owners would go elsewhere if Marriott forced owners to stop charging resort fees

  34. “That would only be a fair comparison if resort fees were optional.”

    They are optional, stay at another hotel.

  35. Last time I checked “tips” are supposed to be optional but many restaurants charge 18% in the final bill. And even if it’s optional, waiter/waitress will post your info online if you do not leave a generous “tip” for doing a lousy job.

    In my opinion, this resort fsee is here to stay and hotels will find other ways to charge extras!

  36. stay away from Marriott THAT is the best answer, I do not go to any hotel, that has the nerve to charge for parking fee , room fees, etc etc , I had a recent incident down in AC , harrahs had the nerve to charge me POOL fee, but here is the kicker, the pool was not open as they had a function that was private, !!!! yes I called the ass’t mgr and got it refunded , do it with your wallet

  37. As the person who introduced the first facility fee in NYC about 6 or 7 years ago I can tell you that the motivation was to reduce guest complaints of being “nickel and dimed” for all the ancillary charges (wifi, gym, pool, calls, & newspaper) that we were charging and yet not reduce overall income. It completely worked, the number of complaints dropped dramatically and revenue were maintained.

    We had some corporate accounts and groups that negotiated not to pay the fee, just as some did not pay for the services before.

    So many of you really believe that hoteliers are truly evil people. Running a first class, union, hotel in NYC is incredibly expensive. Real estate taxes alone often run over $10million a year.

    I suggest you all chill a bit and understand the realities of the hotel business a bit more before launching your vitriolic attacks.

  38. Ultimately i think everybody agrees it’s a money grab, everything agrees it is (sadly) legal, albeit only borderline, and everybody agrees that with very few exceptions, people can choose not to stay in those properties. I will never stay anywhere that charges anything like this, I don’t even stay anywhere that charges for wifi.
    There is no reason for them to get rid of these fees if people continue to pay.

  39. Lots of interesting comments, my experience has been that everything is negotiable in the hospitality industry as well as in travel in general.
    Marriott gives a point credit for not using housekeeping. I bought show tickets in Las Vegas which are typically nonrefundable and got a written confirmation they would refund the tickets if my flight was delayed and came in later than a certain time.
    I stayed in Destin for several weeks last fall after Hurricane Michael and Sandestin resort to be specific has a resort fee for shuttle service, bike rentals, etc.
    I was there to work from sunset until midnight many days and they immediately waived the fee based on my explanation.
    Oftentimes EXplaining creates better results that COMplaining… and a previous poster is spot on – you are the guest, make your feelings known and if necessary vote with your feet and your wallet.
    Supply and demand and service or lack thereof will always work better than government regulation.
    And if there are dummies who keep paying resort fees then the market rules and as justly stated you can participate or stay away. Just my five cents – ok maybe ten 🙂

  40. I call these “BS fees”. It is a total rip off and if a hotel has BS fees I won’t stay there.

  41. It is a money grab (and not just by Marriott unfortunately), particularly for repeat or business customers who certainly won’t be taking advantage of any tour credit or crap offering. It is nothing like baggage fees and to suggest it is is an insult to your best customers. I have never paid a baggage fee in my life mostly because my flying is predominantly international & I have never lived in an area which is serviced by budget airlines. So if I am paying top dollar for my airfare be it full economy or business, there are no extras and I would expect the same at a top dollar hotel which of course in the big cities and resort areas the chain hotels mostly are.

    After decades of visiting Hawaii, I was there during the strike last year which forced me to change a lifetime of habits and stay at non Marriott properties and away from the striking areas to avoid the noise and it was a wonderful wakeup call. However, it didn’t mean avoiding resort fees which are virtually everywhere and I left Hawaii in November vowing never to go back because of that exact reason and the increasingly sub standard product everywhere which no longer makes it a good value destination but it won’t be so easy to avoid NYC and other cities that levy resort charges on items that were once normal inclusions.

    And yes, if you do think they are reasonable Arne, man up and show them up front so we can see instantly that they price is an extra 20, 30, 50 bucks a day!!

  42. Ben, did you have a close look at your final bill for the TWA Hotel stay? Fees, taxes and other add-ons comprise most of the bill !

  43. Thank you, Arne Sorenson, for making abundantly clear that Marriott is headed up by a CEO who is totally comfortable offering up disingenuous lies to the public to justify his company’s practices, and in demonstrating his contempt for his customers, who he clearly thinks are clueless rubes.

  44. @Sam Jones– then just add them to the damn ROOM RATE. That’s what we mean by “don’t nickel and dime us.”

    @Stephanie, actually in NYC the “facility fee” very frequently is the same amount as the food and beverage allowance. I’m not saying it’s okay, just that you DO get something for the fee.

  45. You kids should know you can absolutely refuse to pay the resort fees and this preference can be added to your profile. If you don’t care to use the pool, bikes, boats, beach, driving range or other ‘amenities’ you can opt out and demand to not pay for services you are not using. Express yourselves civilly, firmly and stand your ground. Hoteliers want to earn your loyalty and will oblige this request to keep your loyalty.

  46. I’ve been able to get out of resort fees a couple times by making a fuss and saying that they are being forced upon us.

    But I think more and more the goal is to not stay at properties that charge the fees.

  47. @Don Sweat – I agree. I’ve been doing AirBNB and other B&Bs in NYC for the past ten years. The hotel prices are ridiculously extreme for what you get. If I didn’t have to go to NYC for business, I’d never visit the place again.

  48. Any fee is annoying, but Lucky you have to acknowledge why they do it. Seems the major motivator is that the hotel gets 100% of the fee and doesn’t get diluted by commission etc.

  49. As a shareholder with vested interests it’s simple it adds to our wealth
    You folks know if those fees were lining your wealthy pockets you’d have a good argument to defend your position too
    Plus we know your likely coming back to stay in our world class hotels and resorts and participating in our award winning Bonvoid Program that your hooked on
    Gotcha
    Signed fake Shareholder

  50. it’s annoying, awful, greedy, dishonest in some ways, and a complete money grab. BUT at the end of the day, if you really want to stay at a certain hotel, or you need to stay there, there is really no option besides sucking it up and paying. I stopped getting pissed over it and now I just see it as part of the room rate anyway and move on. unfortunately thats reality. 🙁

  51. Resort fees = Baggage Fees is B.S.
    Hotels charge a resort fee and god forbid you rent a car in a city like San Diego, thats 30$ a day no self parking, valet fee. At the end of the day, we pay because we have to, so have another cocktail by the pool and smile.

  52. Going to Honolulu next week and the resort fees are hard to avoid. What you get for the fee is laughable. A gopro? I guess a few 8 year old guests may use that?… I’ve lost my free breakfast with Marriott Gold though so Hiltons are already seeing all my Gold in 2019.

  53. I have a business and all of my charges are up front and reasonable for the industry and I’ve had complaint

  54. @Sam Jones

    You are perfectly correct and you can justify it with your excuse. But let me give you a better recommendation and take your initiatives to the next level.

    And I quote you:

    “I can tell you that the motivation was to reduce guest complaints of being “nickel and dimed” for all the ancillary charges” “It completely worked, the number of complaints dropped dramatically and revenue were maintained.”

    Now try this, all you need to do is add it directly into the room rates. You can still call it whatever to ripoff your local tax authorities, just put the total as the total of what is out of pocket.
    “I can tell you that the motivation was to reduce guest complaints of being “nickel and dimed” for all the RESORT FEES”.

  55. I doubt that his lawyers are stupid enough to raise the baggage fee comparison in court. I doubt that he is stupid enough to believe what he is saying. These feed are simply fraud. Marriott lies about its prices. Mr. Sorenson, you are a liar.

  56. Its now up to 1 million people who plan to visit Area 51. Problem is no hotels in the vicinity only in Las Vegas 90 miles south. Can LV handle 1 million, or will they camp in the desert.

    No resort fees !

  57. I am baffled that people keep saying these fees are not disclosed, hidden, a scam, or fraudulent. Have you never booked a room on Marriott.com? As soon as you push select, the entire cost, room rate, taxes, and fees are displayed for your viewing pleasure and cannot be missed prior to entering your card info and making the reservation. The fees are not hidden, you can’t make the reservation without seeing the total cost and detailed breakdown for the stay. So, if you can’t afford it, don’t want to pay it, or as many stated “demand it be removed” stay elsewhere. But, good luck with those demands in HI.

    Aloha

  58. The DC lawsuit and Governmental intervention is the only way these corporate crooks and their Shister CEO’s like Arne are going to change their ways!!! The EU has got it right for a 2nd time, same as their policies regarding holding Airlines accountable for their delays.

    @Tracey K. and @Chasgoose you both are SPOT ON…. All the public wants is a choice to choose and pay for what they want to buy. Bueno!! 🙂

    @Ryan & @Ray – Both of your comments are NOT worth the key strokes to type or energy it took to read them… Dumbars’

    @LuckySucks – Same to you too……. PISS OFF mate and get your own blog!!

    Thanks Lucky and Cheers

  59. Seeing as I petty much only stay in Orlando I get resort fees and honestly if you were to refuse any place that didn’t add them you would be staying in some pretty basic and nasty places as everyone does it . So I’m confused as to why only one line of hotels is being sued?

  60. This is one of those situations where you definitely need a little government regulation to reign in the worst bait-and-switch behavior of companies. I’ve worked in hotels of many brands for 10 years and customers absolutely HATE resort fees. Hotels know this and would love to get rid of them but they can’t because the hotels they compete with all have them. If I list my hotel at $160 night with no fees and my competitor lists at $130 with a $30 resort fee, it is a well known fact that they will get WAY more bookings than I will because customers don’t read the fine print. They book based on whatever the bolded price on Expedia/Priceline/Orbitz says. Now if these fees are outlawed and my competitor can’t charge them either, then hotels will happily make them go away.

  61. Just one more argument about the comparison of resort fees to baggage fees. If a traveler holds a particular credit card or is at a certainly loyalty level, they are not charged baggage fees. Marriott doesn’t even do that. I use their credit card at their hotels and am Titanium Elite which means I pretty much only stay in Marriott properties and they still want to charge, what they call, a Destination Fee when I am in NYC.

    They charge $25/night which gives you laundry/dry cleaning services (you’re lucky if that pays for one item); something toward sightseeing and credit toward food & beverage in their hotel. Who, visit NYC where there are such good restaurants, wants to eat in their hotel.

  62. All I can say is that when you read this BS from Marriott, YOU HAVE BEEN BONVOYED!!!

  63. I’ve had pretty good luck calling the hotel’s front desk, indicating my desire to stay at the property if they can drop the daily resort fees. After all, isn’t getting $350/night better than nothing? If they advertise a golf course, tell them you don’t golf (or you will not be during that stay). Actually, I find self-parking fees more egregious. How the hell do they expect you to get to their fancy “resort”, walk? Perhaps it’s a way for them to charge you $200 for airport “limo” if a taxi isn’t available for $25. Last, vote with your wallet. The independent “resort” down the street is damn nice, has NO resort fees and the nightly rate is 30% less.

  64. Like some readers already commented, we used to love visiting Honolulu (Waikiki). We have not been back for 2 years because it’s now almost impossible to find hotels without those scam resort fees. We adore Hawaiian people, culture, and the beautiful nature, but we cannot justify the increased cost anymore. Sadly, I doubt that the local people even benefit from the revenue from the resort fees, just executives and shareholders. In summer, it’s cheaper to vacation in some European beach destinations if we can score cheap flights. In winter, we can get more value out of just taking a cruise.

  65. I hope that this same process is followed with airlines and their “fuel surcharge”. An unfair upcharge that used to be included in the price of the ticket and doesn’t materially change when fuel prices go down. A cleaver way for the airlines to lock in prices and reduce discounts for customers who have point-of-sale corporate programs .

  66. If the resort fee was per stay instead of per day I might be more agreeable to it, but to charge me per day for all these amenities I most likely would not use is laughable. Oh, and as far as those F&B credits, you usually get 1, just 1 for the stay, say $50 F/B credit for a 4 night stay – ok, so that’s like 2 cocktails and an appetizer, puhlease.

  67. Are there any hotel chains that don’t charge resort fees or they are optional? If so, I’d love to have a list of them so I can frequent the ones that don’t charge them.

  68. While Marriott does disclose the resort fees, they DO NOT make it easy to find the parking fees. I’ve seen Marriott properties where the resort + parking fees were more than the room rate!

    Cash grab, pure and simple.

    The best way to fix this would be getting the OTAs to post the nightly rates as combined rate+fees. That would fix it quickly.

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