Starwood 2003 Annual Report Download - page 21

Frequent Guest Program. The Company's loyalty program, Starwood Preferred Guest» (""SPG'') has
over 19 million members and since its inception in 1999, has been awarded the Hotel Program of the Year
three times by consumers via the prestigious Freddie Awards. SPG has also received awards for Best
Customer Service, Best Web Site, Best Elite-Level Program, Best Award Redemption and Best Newsletter.
SPG, which was the Ñrst loyalty program in the hotel industry with a policy of no blackout dates and no
capacity controls, enables members to redeem stays when they want and where they want. SPG yields repeat
guest business due to rewarding frequent stays and purchasers of VOIs with points towards free hotel stays and
other rewards, or airline miles with any of the participating 32 airline programs.
SigniÑcant Presence in Top Markets. The Company's luxury and upscale hotel and resort assets are
well positioned throughout the world. These assets are primarily located in major cities and resort areas that
management believes have historically demonstrated a strong breadth, depth and growing demand for luxury
and upscale hotels and resorts, in which the supply of sites suitable for hotel development has been limited and
in which development of such sites is relatively expensive.
Premier and Distinctive Properties. Starwood controls a distinguished and diversiÑed group of hotel
properties throughout the world, including the St. Regis in New York, New York; The Phoenician in
Scottsdale, Arizona; the Hotel Gritti Palace in Venice, Italy; the St. Regis in Beijing, China; and the Westin
Palace in Madrid, Spain. These are among the leading hotels in the industry and are at the forefront of
providing the highest quality and service. Starwood's properties are consistently recognized as the best of the
best by readers of Condπe Nast Traveler, who are among the world's most sophisticated and discerning group of
travelers. The November 2003 edition of the Condπe Nast Traveler Magazine named nine Starwood properties
in the top 100 ""Best in the World'', with the Westin Turnberry in Scotland ranked as the top European Resort.
In addition, the Condπe Nast Traveler Magazine January 2004 issue included 55 Starwood properties among its
prestigious Gold List and Gold List Reserve, more than any other hotel company.
Scale. As one of the largest hotel and leisure companies focusing on the luxury and upscale full-service
lodging market, Starwood has the scale to support its core marketing and reservation functions. The Company
also believes that its scale will contribute to lowering its cost of operations through purchasing economies areas
such as insurance, energy, telecommunications, technology, employee beneÑts, food and beverage, furniture,
Ñxtures and equipment and operating supplies.
DiversiÑcation of Cash Flow and Assets. Management believes that the diversity of the Company's
brands, market segments served, revenue sources and geographic locations provides a broad base from which
to enhance revenue and proÑts and to strengthen the Company's global brands. This diversity limits the
Company's exposure to any particular lodging or vacation ownership asset, brand or geographic region.
While Starwood focuses on the luxury and upscale portion of the full-service lodging and vacation
ownership markets, the Company's brands cater to a diverse group of sub-markets within this market. For
example, the St. Regis hotels cater to high-end hotel and resort clientele while Four Points by Sheraton hotels
deliver extensive amenities and services at more aÅordable rates.
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