Travelers love maximizing their loyalty points, and hotel programs are a cornerstone of many points strategies. However, recent shifts in how major hotel chains value their points have left many feeling the pinch. Devaluations, whether through increased award night costs or changes to award charts, are an unfortunate reality in the world of travel rewards. Let’s delve into the recent changes at IHG, Hilton, and Hyatt and discuss how these impact your future redemption plans.

The Era of Dynamic Pricing & Rising Costs

For years, many hotel programs used fixed award charts, where a specific category of hotel cost a set number of points per night. While chains like Marriott and Hyatt still retain elements of this, IHG and Hilton have increasingly moved towards dynamic pricing models. This means the points cost for a night fluctuates based on factors like demand, cash price, season, and even the day of the week.

IHG One Rewards

IHG was one of the earlier adopters of dynamic pricing, and while it sometimes offers incredible value at lower-tier properties or during off-peak times, the overall trend has been upward for popular and high-end hotels. Many properties that once cost a reasonable number of points now demand significantly more, especially during peak season. This makes aspirational stays or booking in high-demand locations much more expensive in terms of points.

Hilton Honors

Hilton Honors has also leaned heavily into dynamic pricing. While they still have a maximum points cost for standard rooms at certain properties (which is often incredibly high), the points needed for a free night can vary wildly. Similar to IHG, the cost at many desirable properties has crept up, requiring members to hoard more points or accept less value per point than they might have in the past. Finding those sweet spots requires diligent searching and flexibility.

Hyatt’s Targeted Adjustments

World of Hyatt has historically been praised for maintaining a relatively stable award chart and offering excellent value, particularly for high-end properties. While they haven’t fully adopted dynamic pricing across the board in the same way as IHG or Hilton, they have implemented strategic changes that function somewhat similarly.

The introduction of peak and off-peak award pricing means that hotels within the same category can now cost different amounts depending on the date. While off-peak offers a slight discount, peak dates (often when you most want to travel) carry a premium. Furthermore, Hyatt periodically adjusts hotel categories. Recent changes have seen numerous popular properties move up a category (or two), directly increasing the points required for a free night at those specific hotels.

Impact on Your Redemption Strategy

So, what do these changes mean for you?

• Higher Points Costs: The most obvious impact is that your points don’t go as far as they used to, especially for popular destinations or luxury stays.
• Reduced Sweet Spots: Finding those incredible redemption values that were once common is becoming harder, requiring more effort and flexibility.
• Increased Need for Points: To book the same trips, you now need to earn more points than before.
• Value Fluctuations: The value you get per point is less predictable, varying greatly depending on the property, date, and demand.

Adapting to the New Landscape

While devaluations are frustrating, they don’t make points worthless. You just need to adapt your strategy:

1. Be Flexible: If possible, travel during off-peak times or consider slightly less popular locations to find better value.
2. Diversify Your Points: Don’t put all your eggs in one basket. Hold points in multiple programs and transferable currencies (like Chase Ultimate Rewards, Amex Membership Rewards, or Citi ThankYou Points) to give you options.
3. Crunch the Numbers: Always compare the points cost to the cash cost to ensure you’re getting a reasonable value (e.g., at least 0.5-1.5 cents per point, depending on the program).
4. Focus on Earning: Utilize credit card bonuses, promotional offers, and elite status bonuses to maximize your points earning.
5. Consider Lower Categories: Explore staying at lower-category hotels within the brand if location and amenities meet your needs.
6. Look for Promotions: Keep an eye out for promotions like IHG’s PointBreaks (though less common now) or system-wide sales that might offer temporary discounts.

Conclusion

The recent adjustments by IHG, Hilton, and Hyatt reflect a broader trend in the loyalty landscape. While it requires more diligence and flexibility from travelers, understanding these changes is key to navigating them effectively. By staying informed and adapting your earning and burning strategies, you can continue to unlock value from your hotel points, even in a world of evolving redemption costs.