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The Marriott-Sonder fallout served as a lesson in what not to do during a corporate crisis, public relations experts said.
In the past week, chaos ensued at short-term rental company Sonder’s properties after Marriott ended their licensing agreement on Sunday. A day later, Sonder announced that it would file for Chapter 7 bankruptcy.
Guests staying at Sonder properties were given notice at the eleventh hour to vacate their rooms, forcing them to book alternative accommodations at sometimes–exorbitant prices.
A pair of crisis communications experts say Marriott’s biggest mistake was losing control of the narrative.
Representatives for Marriott and Sonder did not respond to several requests for comment from Business Insider.
Losing control of the narrative
Evan Nierman, the founder of Florida-based crisis public relations firm Red Banyan, told Business Insider that Marriott lost control of the crisis messaging the moment people started telling their stories online.
On Sunday, guests staying at Sonder properties began posting on platforms like X and TikTok about being forced to vacate their rooms.
“Once people start describing themselves as temporarily homeless because of your brand, the reputational damage becomes hard to contain,” Nierman said.
Oliver Ellerton, the director of the Singapore-based public relations firm Ellerton & Co., said Marriott failed to get its messaging out quickly. Ellerton previously worked as the PR lead for the Ritz-Carlton and the JW Marriott in Kuala Lumpur.
“Guests were being moved out while call centers were still giving outdated information,” he said. “Marriott didn’t lose trust because they made a difficult call, they lost trust because their messages changed faster than guests could pack their suitcases.”
He said that instead of sending emails, each guest should have been called personally. Marriott and Sonder should have used social media and other channels to explain the situation and provide clear next steps, he added. Sonder’s last Instagram post was 17 weeks ago.
“Most importantly, all Marriott and Sonder staff should be aware and on the same page,” he said. Sonder employees that Business Insider spoke to said they were as blindsided by the Marriott-Sonder breakup as guests were.
A lack of accountability
Another mistake Marriott made was reversing its position on credit card refunds, the PR gurus said.
On Sunday, Marriott told customers that those who had booked Sonder properties via its channels would get full refunds. But a few days later, the company changed the wording on its website, telling customers to contact their credit card companies for refunds.
Ellerton said Marriott’s first instinct to offer refunds signaled accountability, “but the execution broke down almost immediately.”
Nierman said the change in credit card guidance sent mixed signals and made it seem like Marriott was “sidestepping accountability.”
“The lesson is that hospitality companies earn goodwill when they take the burden off the customer,” he said. “Relocation, refunds, and clear guidance are essentials, not perks, during a crisis.”
Sonder’s bankruptcy announcement was a good idea with bad execution
The two experts agreed that Sonder’s announcement that it would file for Chapter 7 bankruptcy was a good move.
“Sonder was transparent about its financial collapse, which is more than many startups offer when the walls come down,” Nierman said. “Acknowledging the severity of the situation is better than pretending the business is still standing.”
Ellerton added that formalizing the bankruptcy filing created clarity, but “clarity delivered late is almost indistinguishable from chaos.”
“When staff and guests learn the news at the same time, that’s not crisis communication, that’s crisis surrender,” he added.
Preparation and planning make for good crisis comms
A crisis like this called for preparation and a plan.
Ellerton said Marriott should have set up a 24-hour, specialized call center for Sonder guests exclusively, processed immediate refunds, and covered the cost of transport to other Marriott properties. Additional perks, such as upgrades, gifts upon arrival, and spa bookings, would have been a bonus, Ellerton said.
“This may be costly in the short run, but it’s the right thing to do,” he said. “Guests will appreciate the effort put in and likely be converted to guests for life, rather than lose all trust in the brand, as seems to be currently happening.”
Lenny Coynault, a 23-year-old tourist from Paris who was told to leave his NYC Sonder apartment on short notice, said he was not planning to stay with Marriott after this incident.
“Once I am refunded — because I won’t let this go — I will likely delete the app and end my relationship with them,” Coynault told Business Insider on Monday.
Nierman said that Marriott regaining customer trust would be an uphill battle.
“Trust is the currency of hospitality. Once people feel abandoned, it takes years to rebuild that trust, if it can be rebuilt at all,” he said.
He added, “A crisis does not destroy a brand, but a poor response to one does.”
Are you a guest or employee affected by the termination of Marriott-Sonder’s licensing agreement? Contact this reporter via email at [email protected].
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