How Much Marriott Hotels Have To Pay When Bonvoy Members Stay

Marriott claimed over 140 million members at the end of 2019. At some brands members represent about two thirds of revenue. Based on franchise disclosures, the average Marriott Bonvoy member pays AC Hotels a $200.74 daily room rate and at Westin hotels it’s a $185 daily room rate.

Guests aren’t customers, they’re Marriott’s product – and the product that all hotel chains sell to hotel owners. While hotel chains push ‘book direct’ as a way of lowering costs, distribution isn’t free. Franchisees pay more for Bonvoy members than non-members, on the theory that Marriott is delivering these “leads” to hotels. And those fees fund points that members earn.

For Westin in 2021, Marriott is charging 4.2% of “qualifying revenue generated by customers earning loyalty points or miles” for the cost of Bonvoy, not including bonus points. The cost of those is higher than you’d expect.

For AC Hotels, though, the base charge is just 2.3% of qualifying revenue which includes awarding of base points.

These fees add up, with all of the points members earn. During the pandemic Marriott went $800 million into the hole with American Express and Chase, pre-selling these points. Marriott reported $5.7 billion deferred revenue as program liability. That makes continually devaluing the points so irresistible. At too many of these programs its the CFO that wins over the long-term value of the business.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. What the property owners don’t get is that a program such as Marriott or Hilton or whatever drives guests to their properties who would otherwise not have chosen their properties. All they see is the expense. They don’t see that the incremental revenue from the otherwise empty room far outstrips that expense.

  2. So can you negotiate perks with the individual hotel management if you choose to forgo using your Bonvoy number in the reservation?

    For non elite members the 10 points is maybe worth about 5% of the room rate vs the 4% the hotel is billed at a full service hotel, but less if you don’t ever earn enough to use at a hotel you’d like.

  3. @Lee is correct.

    The problem is that twenty years ago, a lot of Marriott, Hilton, Hyatt & Starwood (RIP SPG) were owned by their respective corporations. Now, they own almost none of their hotels and have been replaced by a lot of small investment groups. An investor in one city doesn’t care if they’re top-tier and meeting all brand requirements when doing so costs them extra $$$. It’s ridiculously short-sighted but the chains haven’t been demanding they adhere to standards since covid.

    Pretty soon, they’re not going to understand why there’s no loyalty and after having stripped away benefits of hotels they don’t get why Airbnb will overtake them with a large percentage of their customer base.

  4. @Sean – I don’t think those two things are necessarily correlated. I no longer have any brand loyalty whatsoever, because I have low/mid-tier status with Marriott, Hilton and IHG from credit cards and airline status, plus residual higher tier status with Accor from having stayed at a resort for a week with my family and a couple of business trips pre-pandemic. I just book wherever is most convenient and fits my mood. The amenities of higher tiers no longer justify the loyalty.

    That said, I have *no* desire to stay at an Airbnb for any purpose, but especially not for business travel, and that’s not going to change, regardless of any further degradation of status.

  5. More and more, I find it better to use the loyalty program of a booking engine such as I get one free night for every 10 nights (with max value equal to the average cost of the rooms booked). I’m not limited to any particular hotel brand, and I often find that the cost of the room is less when booked there, as opposed to the so-called “best available rate” for the chains — which it never is.

    My only issue is that Capital One seems to have stopped the 5x Cap One points when booking at using the link from the Cap One website. Oh well….

  6. I’m a satisfied Bonvoy product if that’s how you choose to label me. 400k points racked up so far this year and have used points to book three separate overnight stays in 2022. I will also use points this summer as I did last year to book a week in Florida for my son’s baseball tournament. No complaints here.

  7. Interesting but this isn’t the whole picture. The hotels pay franchise fees, have to buy Marriott branded products for the hotels, etc. The revenue % is just a part of all that.

  8. Actually, the elite bonus points (other than the welcome points) are not billed to the hotel. Welcome points for Gold members and above are billed at a different rate

  9. I can’t figure out if the crazy lack of amenities and gifts at arrival, etc., is due to COVID or Marriott taking over SPG. Starwood was the best- the best stays of my life and the best points. As a Lifetime Platinum with Marriott I feel like a nothing.

  10. I was at the Renaissance in Toledo, Ohio, last week. Kudos to them for having an open concierge lounge with free booze for eligible elites. But they literally have no amenities anywhere else in the hotel. The Holiday Inn Express and Fairfield Inn are offering more. You couldn’t even buy a water in the gift shop off the lobby. It was like a Soviet Union-era grocery store.

  11. This Starwood Platinum for Life life’s changed when Marriott took over. We had to most wonderful of worldwide travels – great payback for our loyalty. Not the redemptions have skyrocketed and the service has sunk. I certainly no longer feel the loyalty that they encouraged and that eagerly pursued. The minute the NY St Regis went from 35,000 points per night to 85,000, I knew the end was near. Sad

  12. FWIW, I used to stay on points on lower end Marriott properties very often (RI’s, Courtyards, Springhills, etc.). More often than not, pesky $12-13 charges used to appear regularly on folios and my credit card and were a pain to have removed. I was always told they were accidental and represented reimbursement for housekeeping services.

  13. Earn points in USA through crazy credit card sign up bonuses, card card spend promotions, business travel, generous granting of Diamond and elite status for almost nothing by programs. Go to Europe. South America and Asia. Get upgraded to a suite for cost of base room

  14. With hospitality dumped as a historic absurdity, Marriott is now nothing more than a cash cow, to be milked for as long as people (the manure) are willing to be conned/Bonvoyed. But it will all eventually end in disaster

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