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Hi, I’m Brad Feld, a managing director at the Foundry Group who lives in Boulder, Colorado. I invest in software and Internet companies around the US, run marathons and read a lot.

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Ripped off at the Ritz-Carlton New Orleans

Comments (27)

Jeff Nolan’s post Blogs as Early Warning Systems inspired me to try a similar approach with a recent disappointing experience that I had at the Ritz-Carlton in New Orleans.

I love staying at Ritz-Carlton’s and – while it’s often an expensive experience – I’m willing to pay a premium for the service and comfort provided. Before I left for Alaska at the end of June, I went to the annual EDS / NMCI Industry Symposium where I was on a VC panel with Captain Christopher who runs NMCI for the Navy. The conference was at a sold out Marriott so my assistant put me up in the Ritz down the block. In addition to being a magnificent hotel, I ended up in a room on the Club Level (which I’m sure I paid more for) which included a nice concierge service and a bunch of free (and very good) food.

I only stayed one night, but had a very pleasant stay. I went to check out at around noon and everything was going smoothly until I looked at my bill. I was shocked by the total (which is usually all I look at) and quickly looked over the bill. I wasn’t surprised by my room charge (which was actually pretty reasonable), nor did the state tax, city tax, or occupancy charge both me as I’ve become immune to all the extra “taxes” we pay for travel. However, the “phone – long distance charges” totalled up to over $230 which blew my mind.

I asked the person checking me out why the long distance charges were so high. My recollection is that he indicated that Ritz-Carlton policy is to charge $15 for the first five minutes of the call and then $2 / minute thereafter (or something close to this.) I was speechless. My room had FREE high-speed Internet access. The Club Level had FREE gourmet food. But – my long distance phone bill was $230? I’d made a few short calls and had one long conference call – but $230? Maybe $23, but not $230.

Normally I’d have used my cell phone to make all my calls. However, in my room, my cell phone didn’t get a signal (it worked everywhere else in New Orleans, including in the Marriott Hotel.) So – I used the phone in the room. It didn’t even occur to me that there would be long distance charges, but if there were, I figured they’d be nominal since long distance service is now less than $0.05 / minute.

I asked the person checking me out if this was for real. I told him that I accept responsibility for not reading the fine print, but this seemed outrageous. He responded that “this is the policy – if you don’t like it you’ll have to take it up with Ritz-Carlton Corporate.” I asked one last time if he was serious – I’d told him that I’d recently stayed in a Marriott somewhere and had paid $10 for high speed Internet and unlimited long distance service. He responded, “We aren’t the Marriott.”

I paid my bill and left, the entire wonderful experience of the preceeding 24 hours completely obliterated by the last five minutes of my stay. As I stepped out into hot, muggy New Orleans afternoon I was baffled, frustrated, and amazed. I thought of all the stuff I’ve read from Seth Godin in the last few years and how he’d be rolling on the ground laughing at how the Ritz blew it.

So – I’m going to give the Ritz-Carlton a chance to redeem itself. I’m not interested in my money back. However, I am interested in the Ritz-Carlton changing their long distance pricing policy. While I’m not going to be so presumptuous as to suggest what they should charge, I suggest they consider pricing it similar to their high-speed Internet access.

I’ve forwarded this post to Simon Cooper (President and COO) and Debi Howard (Managing Director Customer Relationships) at Ritz Carlton Corporate. I’ll keep you posted on their response.

  • JW

    You’re a jet-setting VC and you just learned that hotels (not just the Ritz!) gouge long-distance calls?!?!?!

    Feld Comment: Yeah, clearly I had forgotten (my wife Amy had a similar response when I whined about this to her.) Since I use my cell phone everywhere, I almost never get hit with stupid long distance phone bills like this. Interestingly, many of the high end hotels I stay at have adopted much more reasonable long distance phone charges – this is the first time I recall being gouged in a long time and it really annoyed me.

  • Jeff Nolan

    Actually, the Ritz IS the Marriott.

    I had a similar experience recently that makes me believe that hotels are installing cell phone jamming equipment, and that most of the so-called taxes are actually fabricated. Rental car companies are in the same category, a recent multi-day rental of $300 included $80 in taxes.

    I don’t mind paying a premium for in-room telephone services, after all, it’s their phone system, but what you were charged is outright gouging of the worst kind because the subtext of the charges is that “if you can stay at the Ritz you can afford to pay whatever we charge you for phone services and anything else”.

    Final thought is that there has to be a nice little business opportunity in providing “road warrior VoIP” for in-hotel use to take advantage fo that free Internet service!

  • http://www.feld.com/blog Brad Feld

    I had forgotten that the Marriott International owns Ritz-Carlton. From the Ritz-Carlton website,
    In 1995, Marriott International purchased 49 percent interest in Ritz-Carlton. Three years later, that interest was increased to 99 percent.

  • http://www.duchs.com Mario

    Short hint: Remove or slightly modify the e-mail adresses in your excellent blog entry for they might be picked up by spambots who crawl the web continously searching for new adresses.

    Feld Comment: Interesting – I hadn’t thought of this – even though I am deep in the anti-spam universe (e.g. our investment in Postini). I never worry about having my email address on a site – Postini quaranteens between 500-1000 spams a day for me (I’ve had feld.com since 1994 and am also the default address for the domain.) I think this problem sucks – I really don’t want to not be able to include email on web sites because of spambots. In this case, I’m hopeful that the Ritz has good anti-spam products. If not, I guess I have some I’ll recommend. I’ll also remove the email links just to be polite.

  • http://calacanis.weblogsinc.com Jason

    I had the same thing happen at the Ritz and I’m a huge RC fan!!! I got so angry about the charge (it was over $100 for one call!!!) that they took it off… I just kept laying into them at the counter to the point at which I was holding up the line.

    I bet they will respond… also, you should name your post Ritz Carlton New Orleans so that when people search for that on google your post comes up.

    I did a story about Asurion insurance and now they have to live with my blog post being the second result after their home page on Google!!!

    Gotta love blogs…

    Feld Comment – I should have yelled louder I guess. Blog title changed – good suggestion

  • http://www.davinciinstitute.com Tom Frey

    Well written Brad. Everyone hates being scker punched by the people that are supposed to be taking care of you. I just posted this on the Impact Lab – http://www.impactlab.com.

    We’ve got a great following. Hope it helps.

  • proper-one

    Just put the cell phone out on the balcony or against the window. Use your bluetooth headset in the room.

    Don’t forget your phone in the morning!

    ciao

  • http://naotakeblog.typepad.com/sottovoce/2004/08/blogs_as_early__1.html Sotto Voce

    Blogs as Early Warning Systems: Continued

    昨日取り上げたGuardian誌の記事を読んで議論を発展させているblogを2つほど発見。 一つ目はSAP VenturesのJeff Nolanで、自分とAmazonとの間であった問題(ある本に関する誤った記述を指摘した

  • Erik Peterson

    “I did a story about Asurion insurance and now they have to live with my blog post being the second result after their home page on Google!!!”

    A search for ‘Asurion insurance’ lists your post first, above the company homepage. I can only imagine how upset Ritz Carlton would be if the same happened with this post.

  • Dave Jilk

    Entertaining.

    There was a good apropos article about hotel rates and phone calls in the NY Times the other day, worth reading.

    I find two things baffling about this:

    1. Is there ANYBODY who DOESN’T get outraged when this happens? Do they really have customers who don’t care? I guess sports stars and hollywood types don’t care, but that can’t be the major portion of their guests. So the result is that ANYONE who uses their phones gets pissed off. How can that be good for them?

    2. It seems like they are missing a good business opportunity. The reality is that cellphones are NOT great for conference calls, and I’d much rather use the room phone. Presumably people would be willing to pay a reasonable amount to have a landline … what, $0.25 a minute or so? So an hour call is maybe $15? They would actually get VOLUME on this, and make money, versus having to write off half of the bills and outraging their customers.

    Truly baffling.

  • http://www.itsthecustomerstupid.com/2004/08/legendary_ritzc.html It's the custom

    Legendary Ritz-Carlton customer service

    Brad Feld over at Feld Thoughts has a post about his recent experience at the Ritz-Carlton New Orleans. His cell phone didn't get reception in the room so he made some phone calls from the hotel phone. When he checked

  • http://www.itsthecustomerstupid.com/2004/08/legendary_ritzc.html It’s the customer, stupid

    Legendary Ritz-Carlton customer service

    Brad Feld over at Feld Thoughts has a post about his recent experience at the Ritz-Carlton New Orleans. His cell phone didn’t get reception in the room so he made some phone calls from the hotel phone. When he checked

  • Fred Ris

    Calling cards are available at Sam’s Club for

  • Gator

    How about a marketing perspective that a VC might like. The answer is EXPENSE REPORTS. Let me ‘splain. Lets say your hotel biz plan says each hotel guest has a gross nightly value of $600. You cant attract guests or business travelers with $495 / night rates. Business travelers will never get expense reports approved (ie why are you staying at $495/night hotels). So you charge $295, probably making it acceptable for most upper mgmt types. Now what about the other $300 the hotel needs to collect? Cant charge you $100 for breakfast, $100 for lunch, because your boss would say “Why are you having $100 breakfasts?” AHHHH, but in every expense report there is a telecom line item, and your boss can sure approve $230 in telecom expenses, because it was probably business related. “Had to use a land-line for that call – my cell was cutting out. Had no choice. Important call.” My conspiracy theory is Expense Reports – keep the per night charges and food charges acceptable, and gouge you on telecom charges because companies find these expenses acceptable, thus, making your $600 per night/guest and satisfying your investors.

  • Seth Green

    How about you quit worrying about $230, quit spending so much time on the internet, and get a real job that pays more then your decreased salary or maybe start staying at hostile’s… Maybe next time you ask to speak to a supervisor and then possibly a manager… RC’s policy is customer satisfaction. Therefore, if you’re not happy, then neither are they. Leave the RC alone. You, or 1000 people like you don’t even put a dent in there revanue… so lets grow up and stop trash talking a multi national/multi billion dollar corporation and get on with your boring, self centered, ego-tistacial pathetic little lives. thank you Seth G

    • Ritz Person

      It's called freedom of speech… What's your problem? Seth Green, you work for minimum wage at the Ritz? What's with the pathetic people who feel that we can't have freedom of speech in the USA.

  • Mike

    Last week ( Wednesday July 19th ) the Ritz-Carlton in St. Thomas hosted my wedding. For the most part my guest all enjoyed themselves. I would like to relate to you one problem which I became aware of today. It seems that one of my guests while relaxing with her husband and some members of my family at the outdoor bar was assaulted by one of the patrons. This gentleman it turns out was not a guest at the resort but rather arrives in the evening to have a few drinks. I later found out that this individual has caused problems with others in previous encounters. When the assault took place security was called and the individual was escorted from the bar. NOT ONCE did management Call my guest to ensure that she was OK. While her injuries were not life threating a call from management expressing some type of concern would have been appreciated.

    I would like to send this e-mail to Simon Cooper but cannot locate his e-mail address. Can someone help me out with this

    Thanks
    Mike

  • Sleven

    Getting upset at the front desk agent won’t solve your problem. Most times they are there to simply check in/out arrivals, and hand you your bill, with no real authority to do more. They aren’t the ones ripping you off. They aren’t the ones you should get mad at. You need to seek higher authority immediately. Starting at the point with the manager on duty, and then taking it up with corporate from there if necessary. But as you said, it was your fault for not reading the fine print, or checking first to see on the call charges. In the end, its only you to blame for what has happened in this situation. You can’t take your car into a dealership and assume just because rotating your tires is $20 that an oil change and tune up won’t run you over $200 with labor, and then expect to get your money back because you assumed it’d be less than that.

    I do like the idea of following up and trying to adjust the charge for the future, that makes much more sense….because yes, you were still ripped off, and thats very disapointing by the RC.

  • Simon Cooper

    Sounds like you just talked to a front desk agent that is not on board with Ritz Mission, or your blog is biased and not expressing the interaction properly. Each and every Ritz employee is given $2,000 of instant empowerment. Sounds like it should have come off, but it's like a poker game on how you react to the answer dealt. Although a big shame on you for using a hotel phone and being surprised, have you been living in a cave? Loser… like you never made a wrong decision.. They didn't start a trash-blog with your name on it saying how you are too stupid to realize how expensive phone calles can be and then talking to the front desk in a rude manner (or whatever view they have of your interaction) .

    • Ritz Person

      If in FACT you are Simon Cooper you have just validated all complaints on this blog. Why didn't you indicate that over 78% of your staff are paid minimum wage. So please tip well to the services provided at the Ritz. Remember that GREED is still alive yet falling rapidly or going to jail like Madoff.
      Freedom of speech is still alive and well.

  • Ritz Person

    The Ritz Carlton has the largest data base on it's customers than most state and local governments. This data they collect is not only used to have first hand knowledge on your return of Birthdays and Anniversaries but also what your purchases are eating habits. Also most don't realize that this includes what charges you incurred during your stay. So if you notice that your paying more for each stay on an economic downturn it's because they know your financial records including what you have in the bank. This is relatively easy for them to do just reentering a purchase and opting out before any transaction is completed. During this in steps of 10k give them more insight than one might think. I feel that a complete investigation of these common practices will show that their data base holds more personal information that what is necessary.

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