During the travel slowdown, almost every hotel loyalty program held off making changes. That means even planned devaluations were placed on hold. Now that we’re at a point where locations are pulling back or even doing away with travel restrictions, loyalty programs are back to increasing the number of points needed for a reward night at popular properties.
While few people will care if the number of points needed for a free night at the Hampton Inn Des Moines airport will cost 5,000 more points for a free night (and I didn’t look this up so don’t @ me if I’m wrong), most of the internet hate will go towards redemptions at aspirational hotels. Bloggers love to write about how you can use your points for a free night on the California Coast, beachside in Hawaii or an overwater bungalow in the Maldives. When hotel programs devalue, the highest-tier properties often feel the brunt of the changes. For example, here are some recent headlines:
- Awful: World Of Hyatt’s 2022 Hotel Category Changes
- Hilton’s New Top Redemption Level Is 150,000 Points Per Night
- Marriott Bonvoy’s 2022 Max Award Price Changes Revealed
- IHG Rewards: How To Deal With The Problem Child Of Loyalty Programs
Sure, it may now cost 40,000 World of Hyatt points to stay at the Park Hyatt Sydney or 150,000 Hilton Honors points for one night at the Waldorf Astoria Maldives. Do you want to know why? It’s because the rich people in the world who don’t know a thing about points and miles are willing to pay the cash price these hotels are charging.
For example, we spent some time chatting with the bartenders at the Grand Hyatt Kauai. That’s the hotel where we paid 33,000 World of Hyatt points for a room that cost $1,300 per night. The pool was crowded so I asked how full the hotel was during our stay. He replied that they were about 80%, but it’s crazy with families during the summer and they’re expecting to be near full capacity.
Rich people have plenty of money they couldn’t spend during the pandemic. Sure, they could rent luxury cabins and take road trips but they were waiting to get out and explore the world again. Besides the travel cash they weren’t spending, these are the same people who were hoarding points during the pandemic. If you have 500K AMEX Membership Rewards points, why not transfer them to Hilton for 5 nights in the Maldives (with the 5th night free)?
So before we all start hating on hotel loyalty programs for devaluing redemptions at high-end properties, we need to realize that the points & miles community is competing against the people who have been gathering points and padding bank accounts during the pandemic. While we might think that paying 100K points per night for a hotel is unfathomable, some people believe this is just a drop in the bucket and can as easily spend $10K out of pocket for four nights at a luxury hotel.
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