This post shows tables I created for the hotel reward category distribution between Hilton HHonors and Marriott Rewards. The tables illustrate how hotel category reassignment plays into the overall value of hotel points when it comes time to redeem what you earned.
Let’s face it. Hilton and Marriott dominate the American landscape for business travelers due to the number of hotels around the country at a variety of market segments from upper midscale to luxury hotels. Each chain is poised to break the 4,000 hotels worldwide benchmark in the next couple of years.
HHonors members can double dip and earn points and miles for each hotel stay or 15 points/$1 as a Points & Points earner. Marriott Rewards has Residence Inn and TownePlace Suites properties which only earn 5 points/$1 compared to 10 points/$1 for other Marriott brands. Virtually all HHonors hotels earn 10 points/$1. The new Hilton brand Home2 Suites earns only 5 points/$1, but there are only a handful of these hotels currently in the 3,800+ Hilton Worldwide portfolio.
Bottom line is Hilton stays earn more points for HHonors members.
Earning is only 50% of the Loyalty Points Equation
Calculating points earned is relatively easy for Hilton HHonors and Marriott Rewards. Earning is a function of your hotel spend for stays and points earning partner activity. Estimate your spend and you have a base level for estimating the points you will earn. The unknown variable is amount of points earned from HHonors or Marriott Rewards promotions.
$2,000 in hotel spend Hilton HHonors = 30,000 points (Points & Points earner) + hotel stays promotion points + elite bonus points + partner activity bonus points.
$2,000 in hotel spend Marriott Rewards = 10,000 to 20,000 points, depending on how many Residence Inn and TownePlace Suites stays, + hotel stays promotion points + elite bonus points + partner activity bonus points.
But how much are 30,000 HHonors points compared to 20,000 Marriott Rewards points?
The point of earning hotel points is to redeem the hotel loyalty currency for hotel stays or other items of value like airline miles or tangible objects like a TV set.
30,000 Hilton HHonors points buys a category 4 hotel reward night at a Hilton brand hotel. Extended stay rewards (4 or more nights offer discount rates) and Points & Money rewards (50% points + cash) can stretch your points for even more reward nights or a higher category reward night.
20,000 Marriott Rewards points buys a category 4 hotel night at a Marriott brand hotel. Marriott does not have a Points + Cash option, although there are 5th night free rewards.
Forgetting the special reward rates, the primary question is what are the category 4 hotel options in Hilton HHonors compared to category 4 hotels in Marriott Rewards?
Hotel Category Reassignment is the primary factor changing hotel point value.
Hotel points have no value until they are redeemed.
The reason I pay so much attention to hotel category reassignments each year is when a hotel shifts from one reward category to another, the value of hotel points changes for that hotel.
HHonors shifts a hotel from Category 2 to category 3 and the cost of a reward night changes from 12,500 points to 25,000 points. The reward night cost doubled, but the hotel room rate probably only changed by a few dollars per night.
A category 2 reward night at a hotel with a $100 room rate for 12,500 points is $8.00 per 1,000 points redemption value for my HHonors points. This same hotel at say $105 as a Category 3 hotel for 25,000 points gives a redemption value of $4.20 per 1,000 points.
The problem with hotel loyalty points is the earning rate does not improve at anything close to the redemption rate devaluation. Most hotel loyalty programs have not altered earning rate for close to a decade. Starwood Preferred Guest made an earning rate adjustment for Super-Platinum members in 2012. This is the first adjustment SPG has made to the 2 base points and 1 elite point earning rate in over a decade.
Hilton HHonors and Marriott Rewards have not adjusted earning rates in years.
Yet, each hotel loyalty program has added new high-end reward categories in recent years.
Hotel Reward Category Shift
- Hyatt Category 5 – Dec 2006 18,000 points (20% increase)
- SPG Category 7 – March 2007 30,000 to 35,000 (50% increase)
- Priority Club tiered rewards – March 2007
- Holiday Inn/HI Express 10,000; 15,000; 25,000 (40% increase)
- InterContinental Hotels 30,000; 40,000 (33% increase)
- Marriott Category 8 - Jan 2009 40,000 points (12.5% increase)
- Marriott Extended Stay Discount Reward Tables for up to 7 night hotel stays changed to 5th Night Free Reward Stays – Jan 2009 (up to 60% increase)
- Marriott Vacation Club Awards - July 2009 (up to 85% increase)
- Hilton Category 7 - Jan 2010 (up to 29% increase)
- Hyatt Category 6 - June 2010 (22% increase)
- Ritz Carlton Rewards 2 Tiers to 5 Tiers – Sep 2010 (up to 68% increase)
- Priority Club tiered rewards: Jan 2012 higher tiers added for all brands (up to 40% increase)
Annual reassignment of hotels among reward categories tends to move average redemption rates higher across the program.
Here are some tables to illustrate how hotel reward category assignment and reassignment changes points redemption value.
Both Hilton HHonors and Marriott Rewards offer category 1 hotels for 7,500 points. The difference is there are only 35 HHonors category-1 reward hotels in the United States right now (up by another 9 hotels on April 30) compared to 227 category-1 hotels in the USA with Marriott Rewards.
April 2012 Hotel Reward Category Distribution for Marriott Rewards and Hilton HHonors in the USA
HHonors website allows a search of category hotels by country.
Therefore, I created the tables of USA hotels by category for HHonors and Marriott Rewards for the USA as of April 12, 2012. These are fairly accurate tables.
The total count of hotels for Hilton HHonors in the table below is just an estimate since I did not check each country (about 80 countries to check) for each HHonors reward category to build an accurate count for international Hilton brand hotels. The Marriott hotel numbers in the table are more precise. The hotel numbers for Marriott Rewards categories 2-4 were quick counts, so close, but not quite accurate.
*Note the numbers in this table do not reflect the April 30 changes for HHonors reward category reassignment.
HHonors Reward Category 6 and 7 will grow by about 25% on April 30 when 27 more hotels become reward category 7 and 66 hotels are added to reward category 6.
The table below is one I created two years ago in 2010 based on precise data for all Marriott and Hilton hotels worldwide. The two tables when compared reflect changes over the past two years.
Marriott Rewards and Hilton HHonors Category Reassignment Trends
The trend over two years shows Marriott Rewards moving hotels upward and out of category 1 and 2 as the proportion of hotels in the two lowest categories has dropped from 34% of the chain to 28%. Many of these formerly category 1 and 2 hotels have likely gone to category 3, but the proportion of category 3 hotels has not changed much overall. As hotels moved into category 3 from lower categories, hotels have moved up from category 3 to higher categories.
The movement of hotels to category 4-7 has been a significant shift in category creep. In March 2010 there were 490 Marriott hotels in categories 5-8, fewer than 15% of Marriott hotels. Two years later that has increased to about 670 hotels; more than 18% of Marriott hotels.
Marriott rewards program still has a far higher proportion of hotels in categories 1-3 (62%) relative to Hilton HHonors categories 1-3 (44%).
Marriott Rewards has fewer hotels in category 5-8 (19%) than Hilton (23%). Hilton rewards for Waldorf Astoria Hotels are similar to Marriott’s Category 8. Ritz-Carlton reward tiers are not considered in this analysis. Hilton HHonors has around 900 hotels in categories 5-7 and Waldorf Astoria. Marriott has about 700 hotels in categories 5-8.
Marriott Rewards hotels tend to be in lower reward categories compared to the Hilton brand hotel in the same location. And the HHonors hotel reward category reassignments on April 30, 2012 do not help in this comparison. More hotels will be added to HHonors Category 6 and 7 at the end of the month to skew HHonors to even higher category hotel rewards.
HHonors members earn more points per dollar on hotel stays, but Marriott Rewards members have far more choice of hotels at lower reward rates compared to Hilton when it comes time to redeem your earnings for hotel stays.