Starwood Offering Up to 25% Off Purchased Points: When It Makes Sense — And Doesn’t

Starwood is offering up to a 25% discount on purchased points through May 31. The same discount applies to gifting points as to buying them for yourself.

Buy Starpoints® for yourself or as a gift now through May 31, 2014, and get up to 25% off the regular price. 

• Get 10% off 500–9,500 Starpoints
• Get 15% off 10,000–14,500 Starpoints
• Get 20% off 15,000–19,500 Starpoints
• Get 25% off 20,000 Starpoints

Now let’s do the math. 20,000 Starpoints still costs you $525. That’s 2.625 cents per point.

Starwood points are worth a lot, and I’ll usually get at least 2 cents per point out of my hotel redemptions. But even for ‘topping off’ towards a hotel award this is dicey. Remember, you’ll get a better deal than buying Starpoints at 2.6 cents with cash and points awards. Those work out to buying back your Starpoints at about 2.1 cents apiece.

And there’s been much grumbling about that price since it’s higher than in the past (though I think it’s still marginally worth it).

But not for hotel awards except the very most expensive. And certainly not speculatively. If you know you have a specific hotel you want to redeem for, where you’re getting at least 2.7 cents a point or higher in value, and you need to buy points to achieve the redemption (a cash and points redemption, or where cash and points is not available) then go ahead. But don’t do it to replenish your points.

Let’s look at this one other way though — airline mileage redemptions.

Here’s my primer on transferring Starwood points into airline miles.

With most airlines 20,000 Starpoints transfer to 25,000 airline miles. The $525 price to buy 20,000 Starpoints now looks like 2.1 cents per airline mile.

That’s not a price I buy miles at. I’m tempted but generally say no to US Airways at 1.88 cents per mile. Those points from US Airways at that price should eventually become American miles.

But if you need to top off a mileage account other than a United one (Starpoints don’t transfer well — 2 Starpoints to 1 mile — with United) and there’s not a cheaper offer such as a 100% bonus with US Airways then this could be a way of buying miles in your favorite airline cheaper than doing so directly from that airline.

And that’s a time that an offer — that at first blush seems too expensive still — could make good sense.

For instance, if you had 100,000 Starwood points and wanted 120,000 to transfer into 150,000 Japan Airlines miles for a New York JFK – Dubai – Bangkok roundtrip on Emirates in first class then buying the last 20,000 Starpoints at a bit over 2.6 cents apiece could make sense.


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 InsideFlyer.com, 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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Pingbacks

  1. […] There is an opportunity to leverage this a bit if you can find ultra-cheap rates at hotels for a Sunday night and book just a one-night stay. That would earn you 6 Starpoints per dollar plus any elite bonuses.  Still a crappy price for points, but if you wanted to get away for a night anyway, it might be a good deal.  But, if you’re just looking to collect Starpoints, the better value is probably to buy them in the current sale. […]

Comments

  1. Hey Gary,

    It makes sense to purchase them and transfer to LH MM – Their milage bargains often get one trans-atlantic for 55k miles in C. That gives you an effective price of something like 1.1 CPM.

    Fred

  2. I generally find manufacturing not worth it, but if these numbers excite people, I think they should consider manufacture more seriously. Also, even at 1:1.5, these rates can still make LAN look pretty good on the new US flights.

  3. @Fred fair, and remember that 35k miles is enough for a domestic premium cabin roundtrip award on United (and no fuel surcharges)

  4. I only buy when the room is more expensive than buying the points. One room I’m looking at is 400 bucks a night but only 10k points.

  5. Whenever miles/points are valued, I don’t think I’ve ever seen one blogger incorporate the fact that you earn miles/points when paying cash but do NOT earn miles/points when paying with miles/points.

    This can easily make a 10-20% difference in the valuation. It’s a little bizarre how this is always omitted.

  6. I agree that you have to be very careful if you are considering using points for a hotel — you have to know the rates and, I’d say, get at least 3 cents per point. Using this to get necessary points for a 4-night award stay to get 5th night free is a good way to increase value (if use Gold/Platinum requalification 25/35% off, even better).

    But I also agree with Fred — transferring to LH M&M can be valuable (plus you can book F in advance).

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