Motel 6 Was Tipping Off ICE in Arizona. How Will That Affect Consumers’ Perception of the Brand?

Privacy concerns around the hospitality chain, at least

A report from the Phoenix New Times Wednesday revealed that two Motel 6 locations in the area had been handing over lists of clientele to Immigrations and Customs Enforcement. As a result, from February to August, at least 20 undocumented immigrants were arrested by ICE agents, who were dropping in at the corporate-owned Motel 6s—not franchise locations—every two weeks.

Motel 6 initially issued a tepid statement. Late Thursday, the chain released a longer one: “Over the past several days, it was brought to our attention that certain local Motel 6 properties in the Phoenix-area were voluntarily providing daily guest lists to Immigration and Customs Enforcement (ICE). As previously stated, this was undertaken at the local level without the knowledge of senior management. When we became aware of it, it was discontinued.”

The statement continued: “Moving forward, to help ensure that this does not occur again, we will be issuing a directive to every one of our more than 1,400 locations nationwide, making clear that they are prohibited from voluntarily providing daily guest lists to ICE.”

But what will the new report do to the hospitality brand known for its welcoming “We’ll leave the light on” tagline?

“This situation is a major test of Motel 6’s reputation,” said David Haigh, CEO of Brand Finance. “Confidentiality is on top of the list of values that customers look for in a motel brand. Breaking that trust can have serious implications, and not just for this particular chain but for the industry segment as a whole.”

Haigh added, “If the practice of voluntary disclosure of guest lists was indeed only a local initiative, Motel 6’s senior management needs to clearly demonstrate the brand’s commitment to protecting the privacy of its customers across the entire network.”

Allen Adamson, founder of Brand Simple Consulting, agreed that the report could affect consumers’ trust of the brand.

“This is treacherous ground for a hotel or a brand to cross that line, that dimension of privacy,” Adamson said. “When you check into a hotel, you don’t think you are compromising your identity. They are about welcoming guests. The whole essence of a hospitality brand is to create a welcoming environment. Having the perception of saying, ‘You’re welcome, but we might report you to ICE,’ doesn’t reinforce the welcoming brand identity they want.”

While the news will likely ding the brand’s reputation when it comes to privacy, Adamson believes that, given the politically divisive nature of the country, it might not affect how many customers the chain has.

“They will gain as many customers as they will lose because this is such a polarizing issue that certain parts of the population will say they are being good citizens, and others will say they will never stay there again,” Adamson said.

While it’s uncertain what the story will do to Motel 6’s sales, the brand did get called out on social media for the actions reported by the Phoenix New Times.

“It just goes to show that when a brand’s behavior doesn’t match its publicly stated values, it gets called out immediately​,” said David Baldwin, CEO of Baldwin&. “We live in a belief economy in which people hold companies accountable even to their own personal barometer of decency. The public also finds out things immediately and spreads the word​ ​really fast via social media. You can’t hide anything anymore.”

Part of the issue, according to Adamson, was Motel 6’s initial response.

“Instead of apologizing and saying they won’t do it anymore, they tried to hide behind the fine print,” he said. “Their response reinforces they are corporate America, and it makes it worse among many consumers. Motel 6 needs to admit what they did, own up to it, correct it and apologize, not try to rationalize it.”

That’s exactly what the chain did in its updated statement Thursday evening.

“Additionally, to help ensure that our broader engagement with law enforcement is done in a manner that is respectful of our guests’ rights, we will be undertaking a comprehensive review of our current practices and then issue updated, companywide guidelines,” the company continued in its updated statement, adding, “Protecting the privacy and security of our guests are core values of our company. Motel 6 apologizes for this incident and will continue to work to earn the trust and patronage of our millions of loyal guests.”