Last week I wrote a fairly extensive analysisof Starwood Preferred Guest’s award category shifts. Every year the hotel chain moves some hotels up and other hotels down in reward category, changing the number of points required for redemption at each. When more hotels go up in category than down, it’s a devaluation in the program.
On the whole Starwood moved as many hotels down as up, in fact a handful more went down than went up. So really just tinkering at the margins with a fairly small percentage of hotels. They gave us a full list of the changes in advance, meaning astute readers of this blog could book hotels in advance if those hotels were going up, or wait until March 1 to book those hotels going down in price. A nice little window to maximize the use of Starwood points, and overall changes which aren’t of concern.
On the other hand, Marriott is making its own annual award category changes and the news isn’t nearly as good.
Marriott is raising the reward category for 350 hotels and lowering the category for 100 hotels on March 8.
Members can make reservations at the lower reward level for hotels moving up before March 8, but Marriott has only released the names of 50 hotel properties that are changing category — so in most cases members have no idea whether or not they need to do this.
The 50 hotels whose names have been released are in award categories 5 through 8. The other 300 hotels changing categories are in 1 through 4. Which is a big deal, because many of those will be going from 4 to 5 — Marriott’s “MegaBonus” offer of a free night certificate after two hotel stays only allows redemptions up to category 4, so those certificates become useless at hotels that go up to category 5. Same story for the free night certificates that come with new Marriott co-branded credit card signup.
It seems odd this year to so substantially increase the number of properties in higher reward categories, but that’s fair enough we expect a certain amount of devaluation. The real issue is no advance notice on 90% of the hotels that are going up in category. That’s how Marriott has played it in the past, and there’s no good reason for it. They know how many hotels are changing category, so they must know which ones are changing category. They’ve even shared 50 hotel names. And if for some reason they didn’t have a final list, there’s nothing written in stone that March 8 has to be the date on which the category changes take place — they could finalize the list, share it, and then implement the changes..
Loyalty Traveler offers an extensive analysis of the changes, what’s known and not known, and how this affects the value of the program.
Me, I just notice that a cluster of properties going up in category that we know about are in the Caribbean, and that there’s now a SpringHill Suites — in Virginia Beach of all places — that’s reached Category 7.
I admit, I understand the economics of the Starwood Preferred Guest program much better than Marriott Rewards, and have a hard time fathoming a SpringHill suites costing such stratospheric levels. I did once hear that whereas Starwood reimburses properties based on their average daily room rate, and actually paying the average rate on nights that those properties hit 90% occupancy, Marriott has a completely different formula and reimburses hotels increasingly more for each award stay. So the more award nights a property redeems, the more the property gets paid for each of those nights. I do not know if that’s correct.
Marriott — unlike Starwood, Hilton, and Hyatt — doesn’t have a ‘no capacity controls’ model of award redemption. The three aforementioned programs will give you any standard room available at a hotel on points (with the occasional glitch, but more or less). Marriott does not do this. They’ll let you spend additional points for additional availability. So their availability isn’t as generous and they’re increasing their award pricing and doing it in a non-transparent way. And yet members are incredibly loyal to this program….
Marriott: The Delta of Hotel Programs
Marriott members tend to be loyal because of the hotels, not the programs. Many of my former co-workers loved the marriott chain because it had enough saturation, and more locations for the mid-tier brands. Although we know IHG is strong at that level with the refresh at HI, there are many travelers who refuse to stay at a HI because of their bad period, so the only choice for these travelers in many cities is either a Hampton Inn, or a Courtyard.
Actually, Marriott does have “No capacity control” but with extra clause. Each hotel can choose certain perriod of the year to allocate only 1 room at lowest level
Troy’s actually incorrect about this. Hotels, for the the most part, do have no capacity controls – however, hotels are allowed to have a few dates per year where they can limit the capacity. When they do this, they have to limit it to 10% of the standard room inventory (not the 1 room that Troy is referring to).
Good to know this. I was thinking of using my voucher at the London Heathrow Marriott which is now a Cat 4. I am departing on 4/18, so I better just book it now or I’ll have to waste my precious starpoints at an airport bed.
BTW, I’ll be coming from Paris where I have 4 nights booked at the Park Hyatt for $160 total. Thank you everybody, but especially Gary, for your collective cyber-wisdom.