Oct142011

HHonors Representative responds to hotels offering only Premium Room Rewards issue

HHonorsRepresentative, the official Hilton Worldwide company spokesperson on FlyerTalk, posted this response today on the Hilton HHonors thread, “Premium Room Reward Scam: Major Devaluation in HHonors Program“.

Thank you for sharing your feedback about the new ways you can redeem points. We want to apologize for any confusion and would like to clarify a few points.

We are excited to announce that members can, for the first time, use HHonors points to book more than 200,000 premium rooms and suites. These premium rooms are some of the most desired in the world. The new Premium Room Rewards and Premium Room Upgrade Rewards enable our members to book any room in any hotel around the world using Hilton HHonors points. Throughout the years, we have received feedback from many of our members requesting this enhancement. We believe having premium rooms and suites now redeemable for HHonors points is a great addition to our program.

While rolling out this reward program, we did experience a technical glitch with a small handful of hotels which caused these properties to appear to have no standard rooms. We are working on resolving this issue so that standard rooms can continue to be booked with Hilton HHonors points at these properties.

In addition to the three new reward products, Hilton HHonors members can continue to redeem their points to enjoy free standard rooms at the more than 3,750 hotels worldwide with no blackout dates. There have been no changes to the Standard Room Rewards product, allowing members to continue to redeem standard rooms at category one hotels through category seven hotels, like select Waldorf Astoria Hotels & Resorts.

We value your loyalty and membership to Hilton HHonors and hope that you enjoy our new offerings.

-HiltonHHonors Representative

 

My Loyalty Traveler viewpoint

This response indicates a technical glitch is responsible for the lack of any standard reward availability at certain Hilton properties.

While it is good to know that all hotels apparently will still have some standard reward availability, the low redemption value of Premium Room Rewards in the range of $3.33 to $4.28 per 1,000 points remains an unpleasant devaluation of Hilton HHonors points.

This is the way I view the Premium Room Rewards redemption value issue:

Hilton HHonors has basically set a value on their points with Premium Room Rewards.

Earlier this week I analyzed Premium Room Rewards offered at US hotels and found the redemption value was around $3.34 per 1,000 points. Premium Room Rewards cost about 30,000 points for every $100 in published room rate for the reward night. This means a $400 hotel room will cost around 120,000 points.

My Loyalty Traveler analysis yesterday showed a redemption rate around $4.28 per 1,000 points for Premium Room Rewards at hotels surveyed in this post. That $400 hotel room will cost about 94,000 points at this redemption rate.

I observed relatively fixed redemption rate value for different Hilton brands and different room types when making Premium Room Reward searches in a specific location.

 

Correlating HHonors Redemption Value on Premium Room Rewards to Hilton HHonors hotel spend

Assume a person earns 30 HHonors points per dollar with hotel base spend, HHonors credit card payments and promotion bonuses.

$1,000 in hotel spend earns 30,000 HHonors points.

Hilton HHonors Premium Room Rewards place a redemption value on 30,000 points somewhere in the range of 30,000 points x $3.33/1,000 points  = $100 to about 30 x $4.28 = $128.40.

Hilton HHonors offers a fixed rebate value for Premium Room Rewards at about $100 to $130 for 30,000 points which might be earned with $1,000 in hotel spend for high earning Diamond members using a HHonors credit card or lower elite level members during a HHonors bonus points promotion.

The highest redemption rate I found for a Premium Room Reward in my searches was about $6.00 per 1,000 points. That is equivalent to about $180 in Premium Room Reward value after $1,000 in hotel spend if your average earning is 30 points/$1 on your hotel stays.

HHonors Premium Room Rewards work out to about 10% to 13% points redemption rebate on Hilton spend and up to about 18% on the best value Premium Room Reward I have found in dozens of searches.

Members earning 15 points per dollar are only get about 5 to 9% rebate value on hotel spend using HHonors points for Premium Room Rewards.

For comparison purposes I typically get 30% to 50%+ in future free and discounted hotel stays from my hotel spend with the major hotel chains. Hilton HHonors current promotion for a free night after four stays allows this kind of high value rebate for a limited time, but Premium Room Rewards in isolation from a high value HHonors promotion are a relatively low value redemption rebate on hotel spend.

Premium Room Rewards offer quite low redemption value for HHonors points in my opinion.

Even Hotels.com gives a 10% rebate and you can book at any brand and almost any category hotel room.

This move is a serious devaluation and particularly hard on Diamond members who may see complimentary upgrade availability reduced at hotels selling premium rewards to all HHonors members.

 

About Ric Garrido

Ric Garrido of Monterey, California started Loyalty Traveler in 2006 for traveler education on hotel and air travel, primarily using frequent flyer and frequent guest loyalty programs for bargain travel. Loyalty Traveler joined BoardingArea.com in 2008.

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Comments

  1. >… particularly hard on Diamond members who may see
    > complimentary upgrade availability reduced at hotels
    > selling premium rewards to all HHonors members

    Given the cost of those premium awards, I can’t see that as a significant risk. Who can afford those point rates?

  2. @Oliver – Very good point. For ONE night at these premium rates you’d have to have spent $10-20K on Hilton Hotel rooms.

    You could do that without becoming an elite member if you only stayed in premium rooms at $1K or so per night a week or so a year. So, I’m not sure the availability of rooms would decrease because these folks would still be booking the room whether they had to pay with cash or points. Maybe if Hilton had introduced it this way, it wouldn’t be perceived as negative. e.g. “You love our luxury rooms, now we allow you to use your points for one.”

    You could also get that many points as a low level elite, or over a decade or so as a non-elite, spending $100-200 per night and saving them up for that special occasion(by which your points have devalued). But, yes, folks who have done this would be very limited.

  3. Hilton should NOT have hired the person from Delta to redesign their website. SkyPesos is a really loathed program. HHonors is a good program and should be kept as it is, the premium rewards rooms seems more of a method of devaluation than anything to me.

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