First, the good news. Marriott is extending elite status through to February, 2023, whether it was earned in 2021 or not. If you have status, it’s being extended. Points expirations will also be paused until December 31st, 2022 and free night awards will be extended.
Basically, nothing in your Marriott Bonvoy account should change for the worse, for a long time. You’ll still have your points, perks and free night. Now, to the disappointing news, and the dreaded “d” word.
Marriott Bonvoy is further devaluing its points program. The mega brand is choosing to remove peak, off peak and standard rates in favor of dynamic (and less predictable) new points rates for all hotels, more closely aligned with cash costs.
This is an unfortunate, but predictable blow, particularly after recent comments from cost cutting CEO, Tony Capuano, who thinks members get “too much”.
Marriott Ditching Award Charts
Award charts aren’t always the easiest to navigate, but for people deciding whether or not to take part in a loyalty program, they provide a crucial benchmark and start. They tell the tale of how many points a hotel will require on a given night.
Members can then decide whether they think they’ll reasonably be able to achieve that points earning goal, and unlock the perks which are the entire reason for participating.
These charts were much easier when every hotel had one price regardless of which night of the year you wanted to stay, but Marriott was among the first hotel groups to ditch this system in favor of peak, off peak and standard rates. That made the system more complicated, but still simple enough to digest.
As it exists presently, a Marriott Bonvoy hotel can have 3 different prices depending on when you would stay: peak, off peak and standard, but only these 3, which gives a solid ballpark for planning and earning the points needed.
That “ballpark” is going away.
Marriott’s cost cutting CEO wants to further reduce costs, and is now doing so by raiding the most profitable part of the Marriott business — the Bonvoy loyalty program.
Capuano is the latest in a series of short term minded CEO’s raiding the cookie jar of loyalty in hopes of propping up the overall business. Marriott is doing so, by entirely eliminating award charts.
How much does a hotel cost per night in points? Give me 365 different dates and I may be able to give you 365 wildly varying prices. Worse, maybe just one, at the highest end of the previous range.
This shift to “dynamic” pricing removes great value from consumers by creating closer alignment between the rate charged in points and the rates charged in dollars. People will have less ability to plan their points earning and set goals, since prices fluctuate as wildly as those with cash.
Think: a roadside motel next to the SuperBowl.
Before dynamic pricing, a hotel could cost $1000 a night, but require only 50,000 points for the stay on some dates, providing times of real value for members who go to the trouble to participate in the loyalty program and earn points.
Don’t forget, every time you earn a point with a hotel loyalty program, they get paid. The only positive in the changes is that Marriott will allow members to redeem up to 15,000 points with a “free night certificate” to achieve a higher value.
If someone holds a free night certificate worth up to 50,000 points per night, they could book a hotel of up to 65,000 points, by paying the difference with points. Of course, this does open up to hotels gaming their points rates to make people pay more, but is generally good.
Starting in March, 2022, points rate will more closely align with cash costs.
Marriott Bonvoy says 97% of hotels will “mostly” stay within their previous points ranges found via the peak, off peak and standard system, but 3% will cost more. The current cap is 100,000 points per night, but Marriott says this could likely go away over time.
What the Marriott soundbite fails to account for is that the average number of days hotels will spend in each previous area, like “off peak”, generally becomes laughable.
Without points charts, Hotels just charge the most points they possibly can, every night of the year, rather than balancing peak, off peak and standard.
Here’s how Marriott spins it…
We will add more price points than the fixed off-peak, standard, peak rates for our members to give them more options when they are looking for the best redemption value.
Flexible point redemption rates will mean that more rooms overall will be available for redemption stays because our hotels will be able to better manage room inventory.
The award chart will go away in March; however, we expect redemption rates for nearly all hotels – more than 97% – will continue to range between their current off-peak and peak redemption rates for stays throughout 2022.
That means less than 3% of hotels will have redemption rates in a higher range than where they are currently in the award chart. For stays beyond 2022, we will adjust rates based more closely on hotel rates.
Between now and March, the current award chart with peak off, standard, and peak rates remains in place. Marriott Bonvoy
A hotel which previous topped out at 100,000 points on peak dates may not tip over the 100,000 point mark come the March 2022 change date, , but can choose to charge 100,000 points every night of the year, rather than just on select peak dates.
That same hotel would’ve previously needed to offer off peak points rates and standard points rates as well, in a fair and balanced way. There’s no obligation to offer a variety of points prices now, so why bother?
History hasn’t shown this cookie jar raiding tactic to be wildly effective, but does allow a leader like Capuano to look quasi intelligent for a short matter of quarters.
Unlike Starwood Preferred Guest (SPG), which Marriott acquired a few years back, Marriott isn’t using this post health crisis period as a time to double down on guest satisfaction.
SPG created what’s now the Marriott ‘Ambassador’ Elite program in the wake of 08′ to stay closer to top tier guests and benefit from the travel rebirth. Marriott chose to use this time to devalue that product as well.
All loyalty programs are subject to a breaking point, or equilibrium. If the game feels to rigged against the players (hotel guests), people often find another game. The more great value that’s removed from a program, the closer to that point we go.
This Move Reduces Transparency For Members
This move to reduce the transparency in how many points a Marriott Bonvoy member needs for a free night, or any other transaction stacks the deck further in favor of the house (Marriott), and their franchise hotels.
The only silver lining is that there’s a grace period from now until March, 2022 to book stays at current rates, without the impending dynamic price gouge.
Marriott hotel owners (franchisees) complained during the pandemic about the costs associated with honoring Marriott’s elite benefits for guests, and about what they get paid on points stays.
Allowing hotels to effectively charge the highest end of peak rates any night they want is a gesture of goodwill to fend off threats of reflagging to another hotel group. Make no mistake: members lose out here, no one else does.
Extremely Disappointing From Marriott Bonvoy
Messaging around peak, off peak and standard rates was complicated enough just a few years ago, in the big rebrand from the Starwood and Marriott programs into the big new ‘Bonvoy’ program.
People like to know that a hotel costs a certain number of points, so they can plan to earn accordingly. Now, people are flying in the dark, with no idea how many points they’ll need for any given hotel.
IHG recently moved to more dynamic pricing of its hotels, which lead to a significant downtick in credit card sign ups. Hyatt, for its part, is only just now moving to a system of peak, off peak and standard, making it one of the few “classic” games in town, where value can be discerned.
I’ve never been particularly into hotel loyalty, for the very simple reason that it’s a three way dance, rather than a simple game of tug o’ war between airline and flyer. Hotel groups like Marriott Bonvoy must appease hotel owners, while also appeasing their loyalty members which drive the program.
It’s becoming increasingly hard to impress one without disappointing the other, which is why hotel loyalty is reaching the dire direction it’s presently in.