Wyndham launches, then cancels, rewards promotion

Early yesterday, Wyndham Hotels and Resorts launched a promotion to poach potential Starwood Preferred Guest members. The offering required SPG members to donate their remaining Starpoints to charity in exchange for quadruple the points at Wyndham Rewards.

While it's a deal that sounds too good to be true, it actually wasn't. For consumers, at least. Wyndham was forced to cancel the promotion, which was supposed to take place from noon to midnight on Oct. 11, due to discoveries of fraud on behalf of those submitting points.

In order to participate, SPG members were to email two screenshots to Wyndham in order to prove they had donated their points, the first image showing their previous account balance and the second showing it at zero. Because screenshots are easy to doctor, the promotion was forced to end due to illegitimate claims being made. Wyndham pledged to donate 5 million Wyndham Rewards points to charity despite the retraction.

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“Today’s Wyndham Rewards trade-up was offered in the spirit of generosity. Before the offer even began, there were obvious and significant examples of fraud. Much to our dismay and disappointment, we have to cancel this promotion,” Wyndham said in a statement. “We’re sad to have to cancel this promotion, but remain dedicated to winning your loyalty."

On top of the cancellation, the company also has to contend with SPG members who already donated their points legitimately, and are now left in the lurch. So what's the takeaway from this? First, it shows the loyalty wars are becoming desperate. Hotels are looking for any advantage they can find, and it's telling that Wyndham would go for this sort of promotion even as some analysts laud it for offering the best loyalty program out there.

Second, it's a good reminder to take a step back and reconsider marketing strategies. Fraud has always existed in marketing promotions, and with the speed provided by the Internet you can lose money even faster than before if you make a mistake. Perhaps a similar promotion, but done using a portal found on Wyndham's site and with an automated response generated for each successful donation would have worked better, but be mindful that if there are rules in place there are those out there willing to bend them at every opportunity.

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