Tuesday, November 17, 2009

Westin: Power of economic incentives in driving environmentally-conscious behavior


Yesterday, I checked in at the Westin Cincinnati and came across the sign above which describes a new "Green Choice" program: decline housekeeping, conserve natural resources, and get 500 Starwood Preferred Guest (SPG) points (or a $5 gift card)!

500 SPG points is quite a lot. In fact, a 2 night stay at the Westin Cincinnati typically yields 504 points for me. By declining housekeeping, I basically double the point value of my stay!

This is obviously an operations win for the Westin. Eliminating the need to clean another room reduces the overall expenses of running the hotel. Apparently, the cost of cleaning a room is approximately $5, based on the value of the gift card.

The "Green Choice" program also speaks to the power of economic incentives as a means of encouraging environmentally-conscious behavior. During my time at the EPA in the late 90's, I worked on a couple of great programs that leveraged economic incentives to encourage environmentally-friendly behavior by consumers and companies. It's good to see that forward-thinking firms, like Starwood Hotels, have found ways to adopt the model as well. The enviros of the world will make the "Green Choice" for environmental reasons, and the frequent business traveler will do it for a good reason too...free points!

And although the "Green Choice" program is not a true business model unto itself, the program does offer an interesting example to leverage in thinking about business opportunities: The Westin is paying you to NOT provide you a service! What would be the parallel in your industry?

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