Hilton Honors says they’re now up over 70 million members, not surprising that they’ve grown from the 60 million claim a year ago. They’re offering a small room discount to members, which is an incentive for people to join.
They also want guests to stay with the program and have spent a lot of time making small points balances useful. And this month they’re introducing a suite of new American Express credit cards with really strong benefits.
However today they’re announcing improvements for elite members — how they earn points, earn status, and gift status as well. I spoke with Mark Weinstein, Hilton’s Senior Vice President & Global Head of Customer Engagement, Loyalty and Partnerships, about the changes.
Increased Points Earning for Elites
Hilton is eliminating the ‘points and miles’ earning style as well as ‘points and points’ at the beginning of April and will start to award points only (with the potential to transfer points into airline miles still a feature of the program).
Four years ago they eliminated ‘points and fixed miles’ leaving only choices for earning based on hotel spend. Points and fixed miles used to be lucrative on short stays.
While I’m not crushed to see points and variable miles go, it was a complicated feature of the program and Mark pointed out that 86% of new members didn’t pick an earning style option.
When the program launched customers needed a reason to join the program, they understood airline miles and were used to earning airline miles for their hotel stays. Hilton wanted these people engaged in their program and their own currency so they developed the “double dip” unique selling proposition that you didn’t have to choose. The time where this was necessary has likely passed, although I lament it the same way I lament HHonors dropping the second H in their name.
At the same time they’re introducing increased elite bonuses.
- Silver goes from a 15% bonus to a 20% bonus
- Gold goes from 25% to 80%
- Diamond goes from 50% to 100%
Kind of. They drop earning styles so lose ‘points and points’. Base members and silvers actually lose compared to earning points and points before.
- No status members go from 15 points per dollar down to 10
- Silvers go from 16.5 points per dollar down to 12
- Golds go from 17.5 points per dollar to 18 points per dollar — basically flat.
- Diamonds will continue to earn 20 points per dollar
Once the new earning structure goes into effect in 3 months I’ll have to update this simple comparison of how hotel programs stack up against each other. Because top elites will earn more for staying more as a result of threshold bonuses.
More Points at 60 Nights and Every 10 Additional Nights Starting at 40
On April 1 Hilton will start to award “10,000 Bonus Points on every tenth night, once members reach at least 40 nights in a calendar year.” In addition at 60 nights there is an additional 30,000 point reward.
Weinstein emphasized “unlimited milestone bonuses” (they don’t cap themselves at 100 nights like Hyatt does) and that this is “not a promotion,” the program is re-built to reward continued stays. He also points out that although the bonus won’t start being awarded until April 1, it will retroactively go back to January 1.
Hilton produced a chart to compare earning for two different Diamond members before and after these changes.
The chart is a little bit disingenuous. The $150 per night average spend and illustrating 60 and 100 night Diamonds is fair, and assuming away any nights being at Tru or Home2 properties where earnings are only half as generous seems somewhat fair. But comparing new points earning to just the points earned before with points and miles, ignoring the value of those miles, isn’t quite fair. They’re getting rid of points and miles and pretending those miles weren’t earn for purposes of this chart.
Just focus on comparing “points and points” and new earn and you see the effect, but bear in mind that the new bonuses kick in at 60 and then additional 10 night increments so the effect will always be a little more dramatic than, say, comparing a 69 or 79 night Diamond.
Ability for Elites to Gift Status
Members staying 60 nights in a year or more can gift status to a friend. For those staying 60-99 nights it’s Gold status, and 100-plus nights it’s Diamond.
Each qualifying member will designate one person per year, and as they stay more nights the status of their designee can change. So gift status at 60 nights, and then once you’ve stayed 100 nights the status of your friend will automatically become Diamond.
Suite at the Conrad New York
Rollover Nights for Retaining Status
Elites (Silvers, Golds, and Diamonds) will roll over qualifying nights earned on top of the number required for the elite tier they achieve. Those additional nights will count towards status the following year.
Note that while Hilton lets you qualify on stays, nights, or base points it’s only nights that roll over. Stays do not roll over.
In addition I was told that “elite rollover nights are only valid for the next calendar year and will expire thereafter.” In other words if you stay 120 nights in 2018 you’ll be Diamond for 2019 and 2020. But if you stayed 180 nights with Hilotn in 2018 you’ll still only be Diamond for 2019 and 2020. You get 60 nights for this year and 120 nights for next year they do not roll over to the year following.
Interestingly Hilton adds rollover nights as Marriott eliminates them. (IHG Rewards Club offers rollover nights as well.)
Conrad Koh Samui
This Is All Great for Elites — Are There Any Downsides?
When I see a program awarding more points my first thought is whether they’ll balance it by making each point worth less. Weinstein tells me definitely that “we have no plan on the books to devalue or change the value of points across the system.”
I worry a little bit that inflating elite ranks through the credit card, rollover nights, and allowing high stay elites to gift status will make it harder to improve the benefits of their status levels. Mark Weinstein disagrees, suggesting that while they’re spending more by awarding more points to elites those are only the elites who stay (so the credit card doesn’t matter) and there won’t be real competition for benefits like on an airline which has only so many first class seats.
I’m not so sure. If Hilton were to introduce guaranteed late check-out, there would be more people competing for rooms imposing more of a burden on individual properties and their housekeeping staff. If Hilton were to introduce a strong upgrade benefit there would be more competition for suites, which on any given night are exactly akin to first class seats (if not more complicated and scarce because availability has to match an entire stay not just a single flight).
Mark says they’re “spending a lot of time on upgrades, have all kinds of opportunity to upgrade [their offerings for] customers” so hopefully that comes next.
Conrad Bora Bora Nui
Hilton is Improving Its Program But Still Has a Gaping Hole for Frequent Guests
Hilton has been very active building on its program over the past year — making it possible to earn more points, to spend smaller amount of points, and to earn and keep elite status.
Other than finally introducing an elite breakfast benefit at Waldorf=Astoria properties, though, none of their changes have addressed the chain’s greatest weakness which is the actual benefits of their elite status.
While they should be commended for offering breakfast at the Gold level, a status that amounts to a giveaway (you get it just for having their mid-tier credit card, or opting in for those having an American Express Platinum), they still do not give Diamond members guaranteed late checkout or upgrades that are anything more than at the discretion of the hotel.
In other words on-property treatment continues to leg for the most frequent guests behind Hyatt, Starwood, and Marriott. Today’s moves though are great for improving the earning proposition of the program for elites. Mark Weinstein says it’s meant so that “every stay counts, there’s a reason to engage more, and no limit to what you can achieve on top of that across the year.”
I don’t worry so much about reduced earning for base members because Gold is pretty much a giveaway level now. Hopefully – having done everything else – we’ll see in-stay elite benefit improvements coming to the program soon.