There have been several stories reporting one piece of change that’s happening at IHG Rewards – the introduction of a new mid-tier level, a change in the name of their top tier, and new qualification requirements for status.
I spoke with Heather Balsley this morning. She’s Senior Vice President of Global Loyalty and Partnerships at IHG Hotels & Resorts. And she shared some other pieces of what’s changing now, and what’s coming in the next few months where the focus will be on elite benefits, the area where she seemed to agree IHG has historically had the biggest opportunities for improvement.
I was excited for this conversation because on the one hand IHG was publicly announcing a few minor changes, while on the other hand touting “a new vision for loyalty” and there seemed to be a disconnect.
The changes that are being announced now are mostly around elite qualifying and these changes go into effect for March. Anyone can still qualify under current criteria (for instance, by making points transfers into the program which count as base points) until then.
It’s worth noting that how status will be earned based on 2022 activity is being announced after 2022 has already started. That seems to be why there’s a bifurcated announcement of qualification changes now, elite benefits later. They aren’t ready to talk about the benefits but the calendar forces them to share changes how status will be earned.
Key changes being announced now:
- A new Gold elite tier with 40% points bonus
- Renaming “Spire Elite” as “Diamond” since the original name was a dud from the start. For those qualifying for this status beginning in March there’ll no longer be a 25,000 point threshold bonus.
In fact Gold isn’t really the new level, the program already has Gold status. Rather they’re taking the current Gold and calling it Silver, and calling the new level Gold.
In addition for those who earn status based on ‘base points’ Platinum and Diamond status will require more points than they did in 2019, but Diamond will require 5 fewer nights. And Silvers and Platinums will earn more bonus points. Here’s the new qualification and bonus point levels:
And here’s how qualification and bonuses compare to status quo. First, qualifying for status based on nights:
Then qualifying for status based on base points:
And here’s the difference in bonus points earned for hotel spend:
So status becomes harder to earn on base points, some more bonus points are going to be given out except to top tier where they see themselves as sufficiently generous (they’re benchmarking against Hilton here).
There are several additional things that I learned speaking with Heather Balsley, though.
- They see improving the loyalty program as necessary to weave together their 17 brands, which I’d add is how Marriott frames Bonvoy for its 30 brands. She offers that,
IHG has been on an exciting journey. Loyalty is at the heart of that. …[L]oyalty is driven first and foremost by an exceptional brand portfolio. We have been investing in rapidly expanding our brand portfolio to 17 brands, including really exciting options at the luxury and lifetyle level. ..[And our] brand transformation programs.. CEO Keith Barr has shared publicly the quality investments we’re making in Holiday Inn and Crowne Plaza brands.
She says that the “loyalty program will bring all of those investments together.”
- Elite benefits are coming, being announced “in the coming months.” While they’re not talking about details yet, they’re still working with hotels ironing things out, we can expect to see some of what elites are “getting with other programs that they’ve told us are important to them.” IHG “won’t do everything our competitors are doing” but we can expect more benefits and benefit choices as well.
- >Hotels are being told it will cost them less to service IHG Rewards members in the future. Heather described a need for “balancing the cost to serve members. [They’ve] eliminated a few costs to them that were lower value to members based on feedback, for example the welcome amenity of points for Gold members. When the new program goes live that benefit goes away and will be replaced by others.” Some of the cost reductions will come from internal accounting rather than direct lower costs for points and benefits.
- In the next week IHG will be launching an award discount promotion for top tier elites.
- The new elite program won’t see any changes to co-brand credit cards earning elite status, or what counts as base points.
Heather suggested that come the end of the year, looking back on the changes that they’re going to announce, she wants members to see IHG Rewards as “the most exciting program in the industry and one that makes sense regardless of what type of traveler you are. We’re really focused on offering value for low and mid-frequency traveler as well as top tiers.”
While they’ll be adding benefits, she sees the new Gold tier as important and a “distinctive offering in the market so you don’t necessarily have to be 60 night, 100 night traveler to get value.”
IHG was already a program that’s all about earning points, since it is very light on elite benefits (no guaranteed late checkout or promise of suite upgrades or even breakfast). We can expect that to change, though it’s not clear yet by how much.
And while they believe their “points are 25% more valuable” because of their move to dynamic award pricing, by which they mean that changing reward night pricing on a daily basis lets them give “25% more currency value” capitalizing on off-peak opportunities I see it as having been a significant devaluation (reward nights cost more points than they used to for the best redemptions customers want most).
Ultimately IHG as a chain has really seemed to understand loyalty for years and vexingly never has quite been able to put it into practice. So hopefully we’ll see positive steps finally in the next few months.