Months ago, Marriott Bonvoy announced that it would be ditching traditional values, which gave an easy indicator of how many points you’d need for a free night. Instead, they’d be moving to a “dynamic” system, where points prices work off cash prices and can vary wildly, by tens of thousands of points from night to night.
The more expensive a room is in cash, the more expensive it’ll be in Bonvoy Points under the new system and previous caps of how many points a hotel can charge at a maximum have been obliterated, or will be from day one, as confirmed by Marriott.
The soon to be “old” system allowed wins for members, where set rates applied, even if the cash price was wildly fluctuating and helped to stimulate fervent brand loyalty.
Tomorrow, March 29th, 2022, that old — and quite frankly better system — will be gone and Marriott Bonvoy will begin the final stages of gutting what great values were left in the program for those who made the conscious choice of participating.
In its place, the Marriott Hotels hotel mega group will start ushering in the new age of a basically uncompetitive cash back program.
It all comes at the same time Marriott’s CEO is working to give hotel owners lower costs by reducing things like breakfast and housekeeping. Some hotels aren’t even including coffee, tea or juice with free “elite” breakfast.
It all begs the question of where the hallowed Marriott brand will soon fit into the spectrum of luxury, versus an old school Airbnb. I say old school, because many of the “new school” Airbnb’s offer more amenities and service than some Marriott’s now.
It’s a sad day for Marriott hotel brand guests and enthusiasts, but a happy day for Marriott, which will now often be paid more when people cash in their points, while giving them less from the experience.
That all rests on one supposition. That is — if, of course, people continue to play the Marriott Bonvoy game, rather than jumping elsewhere to more rewarding programs.
Marriott Is Aligning Cash With Points
Hotels, much like the rest of the travel industry are eager to recoup losses from the last few years. Marriott has used greenwashing and pandemic cuts to quietly reduce costs while blaming things on outside factors.
Marriott’s CEO thinks the best way to do that, is to rob Peter to pay Paul. The CEO regularly sides with hotel owners above customer needs or previous brand standards, but here on this issue, hotels won’t necessarily be paid more for the stays because of the points increases. Just Marriott.
On March 29th, Marriott will begin to phase in its new dynamic system for pricing.
Under Marriott’s current, and soon to be former system, hotels had peak, off peak and standard dates. That was already a more complicated shift than one set price all year, but it was digestible enough.
Members could set points goals from day one, knowing their desired dream luxury hotel would cost between 80,000 to 100,000 points at the high end for a night.
Those goalposts provided clarity and comfort to people, who would often take years to get the points needed for just a single “free” night.
Now, there’s no clarity or comfort, unless you find the notion of “the price is the price, whatever the computer says for that night” comforting.
Because of the volatility cash prices can bring, a hotel which could’ve cost 100,000 points can now shatter that figure on the dates someone would like. All those earning goals immediately get thrown aside, as the goal posts change. Marriott’s ‘Moments’ experience packages are now one of the last “great” values.
Back to the earning table you go, unless you decide it’s a shell game you can’t win.
Marriott would say that there will be instances where cash prices fall and therefore points costs could be lower than what people would’ve previously paid, but experience dictates that this is a minority result, and that the majority go up significantly.
On margin, the hotel group will be able to extract a few thousand extra points for many nights, which will raise the amount they’re able to recoup when members cash in points. It’s not the 100,000 to 150,000 shifts that’ll get people, it’s Marriott slowly turning 50,000 into 52,500, slowly churning the dial in the wrong direction.
Other Chains Sense An Opportunity
IHG Rewards has been a largely uncompetitive loyalty program for the last few years, and in fact also went in the wrong direction for a period of time.
But now, recent changes will make the program more compelling than before, and a collection of boutique hotels will broaden the appeal. Hyatt, with some exceptions has remained true to its loyalty first mission, and also offers very steady and reliable points rates. Hilton has improved much of its program too – and Accor is now making inroads.
Marriott is the largest global hotel brand, but as travel rebounds, the sharing economy of Airbnb, VRBO and others grow, and people sense more choice in market, this game of disenfranchising loyalty members is a risky one.
Unrealistic Changes For Most Of The World
In the United States, earning points at high rates with lucrative bonuses is relatively easy. Even then, the largest Marriott Bonvoy Credit Card bonuses will likely only cover one top tier night, under the new program.
In virtually every other market, or for people who only earn points by physically staying at a Marriott Hotel, the carrot of reward being dangled is simply too far away and now — borderline pipe dream.
At an earning rate of 10 points per dollar spent, a member would need to spend more than $10,000 to earn just one top tier free night. At some hotels, they’d still be 30,000+ points away from that night, requiring $3,000 or more in spending.
Counter that with Hyatt, where many lovely hotels cost 25,000 points per night, and the inflation is off the charts. Ultimately, points are a currency, just like a US dollar, and if inflation — aka costs — become too high, people shift strategies to more achievable goals.
I’ve argued before that by doing this, hotels are playing a dumb game they will lose.
Why bother with this stuff, when you can just earn 10X points via Chase Travel or Capital One Travel, and use the points without silly blackout dates or drama?
Prior to Marriott, Starwood Hotels, which Marriott acquired, doubled down on loyalty in times of economic downturn to keep their closest members close. Marriott is going in the opposite direction by constantly cutting away at values which people found to be worthwhile in the Marriott Bonvoy program.
It’s all fine and well if Marriott’s stock price remains high and members simple gripe rather than walk, but if members start to walk and brands lose their appeal due to cuts like breakfast and housekeeping, that stock price might start falling, and so too might Marriott Bonvoy.
If you have some “locked in” dates for upcoming travel, it’s almost always going to be best to book before the March 29th date to lock in previous rates. The initial blow may not be savage, but over time, history would say it will be.