Jan212012

Marriott, Hilton and IHG Standard and Discount Rewards

The fourth article in this series comparing the “MegaChain” hotel loyalty programs of Hilton HHonors, IHG Priority Club and Marriott Rewards is a look at the hotel reward options for each hotel chain. Reward nights using points are one of the two primary incentives of being a hotel loyalty program member. The other incentive is additional complimentary hotel stay benefits received during hotel stays like free internet, complimentary room upgrades, hotel executive lounge access and free breakfast.

Comparing hotel rewards is one of the most technical aspects of hotel loyalty programs. The rate of earning points is different in each hotel loyalty program with Hilton members earning as many as 15 points per dollar for hotel spend while Marriott and IHG Priority Club earn as few as 5 points per dollar for certain hotel brands. Promotions offering bonus points also affect the rate of earning points in each program.

And even if the hotel loyalty member earns 10 points per dollar in each program, then is a 25,000 point hotel reward comparable in each program? How does one compare a Marriott Rewards category 5 reward night (25,000 points), Priority Club Crowne Plaza reward night (25,000 points) and a Hilton HHonors category 3 reward night (25,000 points)?

The logical way to compare hotel rewards across programs is to compare the published rate for the hotel night to the reward night cost in points. The problem is the reward cost is a fixed cost while the room rate fluctuates and might be $150 tonight and $250 tomorrow night for the same 25,000 points free night. The other variable is a 25,000 points hotel reward might save $100 at one Marriott Rewards category 5 hotel and save $250 at a different Marriott hotel.

The bottom line is hotel reward redemption value is dynamic and fluctuates depending on date and hotel. The best a member can do is try to use points in a way that maximizes their redemption value.

I have tackled this issue before and found Marriott Rewards to be the highest value points compared to the other two programs. This means 25,000 Marriott Rewards points tended to save more money than 25,000 points in Priority Club or Hilton HHonors. But I did not do many of these analyses in 2011.

Standard Hotel Rewards

IHG Priority Club

Priority Club changed its reward structure this week for the first time in several years. New tiers were added to each of the seven IHG hotel brands. Priority Club is different than other hotel loyalty programs by setting reward levels based on brand rather than categories where hotels in every brand are distributed based on average daily rate, reward demand and hotel occupancy. A Courtyard by Marriott property in New York City will be in a higher category reward level and cost more points than a Courtyard in Greenville, South Carolina. Priority Club had the problem that a Crowne Plaza in New York City with an average daily rate close to $300 was the same 25,000 points reward cost as the Crowne Plaza in Greenville, South Carolina with a much lower average room rate.

Rather than switching to hotel reward categories similar to other hotel loyalty programs where hotels are placed in categories typically based on average daily rates, Priority Club chose to add new tiers to each of the hotel brand rewards.

Holiday Inn and Holiday Inn Express formerly had three tiers for reward nights at 10,000 points, 15,000 points and 25,000 points. A new fourth tier was added at 20,000 points to fill in the gap. Regrettably, Priority Club chose to be intransparent regarding the new hotel reward tiers. They will not publish the changes of 2,000 or so hotels in new reward tiers as of this week, even though they state that you can request the lower tier reward level for bookings through March 18, 2012. You have to call Priority Club to find out if the hotel you are booking required fewer points prior to January 18 changes.

Each of the other five IHG brands added new higher reward tiers with Staybridge Suites and Candlewood Suites adding a tier at 5,000 more points and InterContinental Hotels, Crowne Plaza and Hotel Indigo adding a new tier at 10,000 more points. Hotels in the new higher tiers are 25% to 40% more points.

Priority Club Reward Nights2012

Priority Club has three reward types providing discounts to the standard reward rates shown in the table: PointBreaks, Points & Cash, Last Minute Reward Nights.

Priority Club PointBreaks

Undoubtedly the lowest cost hotel reward nights of any hotel loyalty program are Priority Club PointBreaks for 5,000 points per night. Even if you do not currently have any Priority Club points, members can purchase up to 50,000 points in a rolling 12-month period. The cost is $67.50 to buy 5,000 points and the rate drops to $11.50 per 1,000 points with a 20,000 points purchase reducing the cost of a PointBreaks reward night to $57.50.

Priority Club PointBreaks typically are a list of about 100 hotels among the 4,500 IHG hotels globally. PointBreaks hotels only offer these low reward rates for about two months from the time the list is published. PointBreaks hotels drop off the list once the capacity controlled rooms are booked. PointBreaks are a great value, but limited to those who are in the right places at the right time to take advantage of these bargain reward nights.

The current PointBreaks list was posted around November 22 and is valid for hotel stays through January 31, 2012. A new PointBreaks list will likely post sometime during the next four days.

Priority Club Points & Cash Rewards

One of the best features of Priority Club Rewards is the availability of Points & Cash Reward Nights as a potential discount on standard reward nights. Points & Cash Rewards allow the Priority Club member to buy 5,000 or 10,000 points at the time of booking a reward night.

  • 5,000 points = $40 or
  • 10,000 points = $60.

A Crowne Plaza Points & Cash hotel reward night at 25,000 points standard reward level can be purchased for:

  • 15,000 points + $60 or
  • 20,000 points + $40.

Points & Cash Rewards saves points in your account balance while allowing the member to buy points at the discount rate of $6.00/1,000 points when buying 10,000 points for a reward. This is nearly 50% off the standard purchase rate ($11.50 to $13.50 per 1,000 points) and the 50,000 points annual purchase limit for Priority Club points does not apply to points bought for Points & Cash rewards. A member is limited to buying $240 in Points & Cash Reward points per day (40,000 points when buying 10,000 points on 4 reward stays).

Cheap Trick Cancellation

Points & Cash Reward stays require the member to buy 5,000 or 10,000 points during the reward stay booking process. When I book a Points & Cash Reward stay at a Crowne Plaza for a 25,000 points reward, my $60 buys 10,000 points instantly and only 15,000 points are removed from my account balance.

If I subsequently cancel the reward reservation, the entire 25,000 points are deposited back into my account. Basically, the cheap trick is a member can book a Points & Cash reward stays as a way to buy Priority Club points for $6 per 1,000 points. But you do not want to abuse this cheap trick or you may find your account flagged. Priority Club certainly knows members use this workaround to buy cheaper points, but no attempt has been made to change the rules in the past two years since Points & Cash Rewards were added to Priority Club. The primary changes to occur are the cost for 5,000 points increased from $30 to $40 and there is a $240 per day limit in purchase points through Points & Cash rewards.

One other thing to know about Points & Cash Rewards is the points purchased for these rewards are the only Priority Club points I know about that do not count as elite qualification points. All other points earned from hotel stays, partner activities and other promotion bonuses count for elite status with Gold elite at 20,000 points in a calendar year or Platinum elite for 60,000 points in a calendar year. Elite qualification on points is quite easy with Priority Club which is one reason why there are limited defined benefits with Priority Club elite status compared to Hilton and Marriott.

Priority Club Last Minute Reward Nights

This 50% points discount reward has turned out to be probably the most useless hotel reward option in hotel loyalty programs since they debuted in May 2011. Hotels participating in Last Minute Reward Nights are only valid for stays during the first full weekend of the month for Friday, Saturday and Sunday. There is supposed to be an email sent out on Monday before the Friday weekend, but I have never seen a Last Minute Reward Nights email.

Here is a Loyalty Traveler post with the January 2012 Last Minute Reward Nights list of 50% off InterContinental Hotels.  Normally I try to list all the hotels available each month. I wrote about Last Minute Reward hotels on Wednesday, January 4 when I first saw the list. These rewards were only available for the nights of Friday, January 6 to Sunday, January 8. That was a great deal if you happened to be in Frankfurt and got the InterContinental for 15,000 points. It will be 40,000 points per night after March 18. Seriously, how many people took advantage of InterContinental Moorea in the deep South Pacific at 50% off with just three days notice?

Bottom line: Jackpot if you are somewhere with a 50% off Last Minute Reward hotel available.  I have not used this Last Minute Reward yet due to limited locations. The January 2012 list was my best opportunity with two San Francisco Holiday Inn hotels available, but it was just too gorgeous to leave Monterey that weekend for city life.

 

Marriott Rewards

Marriott Rewards unquestionably had the best hotel rewards value until the program went to a 5th night free reward table in 2009. Prior to the changes hotel rewards were lower in cost for each additional night stayed. The discount was as high as 40% off reward nights for 7-night hotel stays. The trade-off for an across the board increase in all extended stay rewards other than 5 night stays was balanced by Marriott’s new “No Blackouts” policy for rewards.

Since 2009 Marriott spun off Ritz Carlton Rewards and tiered the hotel brand into five levels of hotel rewards from 30,000 points to 70,000 points per night with the 5th night free option.

Marriott Rewards competitive advantage over Hilton HHonors is a higher distribution of hotels in the Marriott Rewards lower hotel categories 1-4 in its eight category hotel reward structure.

Marriott Rewards hotel reward levels

  • Category 1 = 7,500 points
  • Category 2 = 10,000 points
  • Category 3 = 15,000 points
  • Category 4 = 20,000 points
  • Category 5 = 25,000 points
  • Category 6 = 30,000 points
  • Category 7 = 35,000 points
  • Category 8 = 40,000 points
  • Ritz-Carlton Tier 1 = 30,000 points
  • Ritz-Carlton Tier 2 = 40,000 points
  • Ritz-Carlton Tier 3 = 50,000 points
  • Ritz-Carlton Tier 4 = 60,000 points
  • Ritz-Carlton Tier 5 = 70,000 points

All Marriott and Ritz-Carlton Standard and PointSavers Reward stays offer the fifth night free. Stay 5 nights and pay the points for four nights. Fifth night free stays may be combined.  A ten night stay gets two free nights. There are no discounts for extended stays of other lengths. A 9-night stay only gets one free night.

Marriott Rewards PointSavers

PointSavers are discount rewards reducing the hotel reward night cost at the participating hotel by one category level.

For example, a Category-6 PointSavers hotel reward is 25,000 points per night. PointSavers for Category-1 hotels are a 20% discount at 6,000 points.

The Marriott Rewards PointSavers list was updated in the past month with dozens of hotels offering PointSavers rates with dates primarily in January through March 2012.

Ritz-Carlton PointSavers offer 10,000 points per night savings. Since 2009 I have seen few PointSavers at Ritz-Carlton hotels posted on the website. Members are directed to phone reservations to request PointSavers.

Marriott Travel Packages (Hotel + Air)

These are high-priced, high-value rewards starting at 200,000 points that offer a 7-night hotel stay available at any hotel category level and from 35,000 miles, up to 120,000 miles. The cost of these rewards ranges from 200,000 to 540,000 points. I will discuss Marriott Travel Package rewards further when comparing points-to-miles exchanges in these hotel loyalty programs in a future post.

 

Hilton HHonors Rewards

Hilton HHonors restructured its reward chart at the beginning of 2010 when it added Category 7 hotel rewards at 50,000 points, eliminated Opportunity Hotels, and shifted the cost of Category 1 and category 2 hotels down. Bottom line is more than 80% of the hotels worldwide increased in cost for a reward night.

Hilton HHonors Standard Reward Levels

    • Category 1 = 7,500 points
    • Category 2 = 12,500 points
    • Category 3 = 25,000 points
    • Category 4 = 30,000 points
    • Category 5 = 35,000 points
    • Category 6 = 40,000 points
    • Category 7 = 50,000 points
    • Waldorf Astoria Hotels = 50,000 to 80,000 points

One of the tasks I see I need to update is a hotel rewards distribution comparison for Hilton and Marriott to backup my claim that Marriott has more hotels in the lower categories. I did not do this analysis in 2011, so here is a comparison from tables I created two years ago.  Once the 2012 hotel category shifts are published I will update the distribution of hotels in each reward category for Hilton and Marriott with 2011 and 2012 data.

HHonors-Marriott hotel category distribution 2010

The table shows that fewer than 15% of Marriott brand hotel rewards were more than 20,000 points in 2010 compared to nearly 60% of Hilton brand hotels being more than 30,000 points in 2010. Hilton HHonors charges far more on average for hotel rewards, even considering Hilton Points & Points earners earn 15 points per dollar compared to 10 points per dollar for Marriott stays. The extra points needed for Hilton hotel rewards negates the extra points earned from Hilton hotel stays. In Hilton’s favor is the easier route to HHonors Diamond elite and 50% bonus points compared to Marriott Rewards Platinum elite for 50% bonus points.

HHonors Extended Stay Discounts

The competitive advantage for Hilton HHonors is the best discount for extended stays using points at hotels in Category 3 to Category 7. HHonors provides a discount on reward stays four nights or longer for members with at least HHonors Silver elite status (4 stays or 10 nights in a calendar year or HHonors credit card member).

HHonors VIP Elite Extended Stay Reward Discounts

  • 4-night VIP Reward = 15% discount off standard reward rate.
  • 5-night VIP Reward = 20% discount off standard reward rate. This matches the Marriott Rewards 5th Night free discount. Five nights at a category-4 hotel normally 30,000 points per night is 120,000 points.
  • 6-night or longer = 25% discount off standard reward rate. This exceeds the discount offered by any other hotel loyalty program. A category 7 hotel reward for six nights at 50,000 points per night is only 225,000 points rather than 300,000 points.
  • Amazingly, Hilton HHonors VIP reward chart has not been updated to separate the category 3 rewards from category 4. Category 3 hotels receive the same 15% to 25% discount shown below for other category hotels, but the HHonors reward chart does not display the discount rates for Category 3 hotels. FlyerTalk member Beltway created the table below showing the discount rate for VIP Rewards.

HHonors VIP Rewards 2012

The chart shown above is from Post #3 on this FlyerTalk thread providing a comprehensive list of Hilton HHonors rewards.

AXON 4-Night Rewards

AXON rewards are available to HHonors American Express cardmembers for a discount on 4-night stays that is even greater than the VIP 15% reward discount.

    • Category 6: 125,000 points  (VIP Reward = 136,000 points)
    • Category 7: 145,000 points  (VIP Reward = 170,000 points)

Points & Money Rewards

  • Category 1: not applicable
  • Category 2: 6,250 points + US$30
  • Category 3: 12,250 points + US$40
  • Category 4: 15,000 points + US$50
  • Category 5: 17,500 points + US$60
  • Category 6: 20,000 points + US$70
  • Category 7: 25,000 points + US$85
  • Waldorf-Astoria: 30,000 points + US$100
  • The data shown here was removed from the Hilton website soon after I published the table in my analysis of Points & Money Rewards on Loyalty Traveler in October 2011. These amounts are currently the amounts still used for Points & Money Rewards, however, Hilton has left open the possibility to change these levels at anytime with this wording in the Hilton HHonors FAQ.

What are Points & Money Rewards™?
If you don’t have enough Hilton HHonors™ points to book a room using Standard Room Rewards, or simply if you prefer to use fewer points, you can combine points with money to book a standard room. This is a great option if you need just a few hundred more points to achieve a reward stay. Availability of Points & Money Rewards varies by participating hotels and stay dates at the time of booking. The number of points required to redeem Points & Money Rewards varies by room, hotel, and booking date.

 

In 2011 Hilton HHonors introduced Points & Money Rewards offering hotel rewards for 50% points and a cash supplement. This new reward option replaces PointStretcher Rewards that have been eliminated for 2012. PointStretcher Rewards offered a 40% discount off standard reward points at select hotels on select dates. Points & Money offer a greater points discount, but also require cash.

I think Points & Money will be a better program feature as long as this reward choice is commonly available at hotels in many places. There were few hotels and very restricted date availability for PointStretcher Rewards over the past several years. Paying a cash supplement and 50% points is a good hotel reward option for HHonors members. The Points & Money Rewards option is still too new and too scarce to determine if this is a better replacement to PointStretchers.

HHonors Premium Room Rewards will be discussed in a separate post on suite upgrades.

The follow-up post to this “Hotel Rewards Comparison” will be to show a couple of locations and compare the reward cost in Hilton HHonors, IHG Priority Club and Marriott Rewards hotel stay rewards and calculate the point value in each program based on the room rates for hotels in the same location and similar market segment.

Loyalty Traveler series: Comparison of Hilton HHonors, Marriott Rewards and IHG Priority Club hotel loyalty programs

1. Hilton, Marriott and IHG Hotel Brand Market Segments(Jan 15, 2012) – this post lists the different hotel brands, number of hotels in the brand, percentage of hotels in each brand and brand’s hotel market segment.

2. Hilton, IHG Marriott: Earning Base Points and Miles(Jan 17, 2012).

3. Making Elite with Marriott, IHG, Hilton(Jan 18, 2012) – Discussion of elite qualification requirements, elite status challenges and status matches.

4. Hotel Rewards Comparison: IHG, Marriott and Hilton (Jan 21, 2012)

 

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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  1. Re: the Hilton Points &Money rewards – there’s also a small tax implication. I have a few coming up and my cat 6 stays are 20,000 points, $70 and $10+ taxes. Still worthwhile as any sub $100 stays at nice properties is great in my book.

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