Has Hilton Honors Surreptitiously Increased Reward Prices at “Tons of Properties”?

I feel compelled to jump in and rain on the parade of cacophony, cognitive dissonance and incoherence that Gary Leff has whipped up with his recent blogpost titled “Hilton Explains Why They Increased Reward Prices at Tons of Properties and Didn’t Tell You” – the latest in his ongoing quixotic quest to rehabilitate BONVoY when the program has been plainly a disaster – because it is a non-story. It’s the proverbial “tempest in a teapot” because in the real world nothing that Hilton Honors has allegedly done is deceptive or going to “gut” or devalue the program. In fact, it is something that other programs do regularly!

Why is it not deceptive? Because when Hilton Honors switched to the revenue-based dynamic pricing system, they did make it clear that the concept of hotel “categories”, which is inherently inconsistent with the revenue-based dynamic pricing model, would no longer be applicable by (a) getting rid of the their award chart, (b) providing a reward search tool as a replacement for the defunct award chart, and (c) clearly stating what members should expect, which was this:

Free nights can be redeemed for as few as 5,000 Points per night and no more than 95,000 Points per night for a Standard Room. The actual number of Points required may vary depending on the hotel, time of year, and cost of a room. Use this search tool to see the lowest and maximum number of Points required per night for each hotel.

Clearly, when in their response to Leff, Hilton representatives wrote “as we previously shared“, they were referring to the statement I just quoted above, which is clear and concise: all Hilton Honors ever promised was that their standard awards would cost between 5K/night and 95K/night. To date, except for one “breach” when they recently requested 120K points/night for a standard award at the new and highly anticipated Waldorf Astoria Maldives, which they swore was a one-off thing that did not represent a raising of the 95K/night cap, the promise has held.

So, not only is Hilton Honors’ raising of award costs at some properties from 5K to 10K not deceptive, since they did let members know to expect it, it is exactly what other programs have done and continue to do when they update their award charts, which invariably reveal, with each update, more hotels raised to higher categories than those that are moved to lower categories.

Because Hilton Honors no longer uses award charts, it is mindless to expect things to continue to operate in the program as if it still had award charts, which are inconsistent with the revenue-based dynamic pricing model. Also inconsistent with the dynamic pricing model is the concept of hotel categories and that is a critically important point to keep in mind because there are times in the Honors program when a 95K/night award would go for, say, 64K/night, which, if Hilton still used award charts and hotel categories, would have put the hotel in a lower, mid-range ‘category’, points-wise. Alternatively, a “low-end” property could have all standard rooms designated as ‘premium’, pushing award costs up to levels that would put it in a higher ‘category’, points-wise. Therefore, to get unhinged when award rates are adjusted in a program with such a model is utterly mindless.

On the other hand, what bears watching closely, and I said this from the day Hilton announced their move to the revenue-based dynamic pricing, is the 95K/night cap, which, if raised, would presage a massive devaluation – and I mean massive and not like the much-talked about and purportedly program-gutting “devaluation” of 2013 that was simply a necessary course correction designed to bring Hilton’s previously and ridiculously cheap award costs up to the levels of their competitors, where they remain to this day.

How “bad” is the “sneaky” devaluation that sparked Leff’s latest outburst against Hilton Honors? Unlike his fact-free pontificating, Brian Cohen over at “The Gate” has actually investigated and “found that the number of [5K points/night] hotel properties has been reduced from 27 to 23 hotel properties…” That is a change of just 4 fewer properties. Cohen also checked on the 10K points per night properties and “found that the number of hotel properties has been increased from 150 to 157 hotel properties“, i.e., just 7 more properties – hardly the “tons of properties” alleged by Leff!

Like I said, this is a “tempest in a teapot”, which I am sure will die quickly like all such tempests do.

In concluding his “outrage”, Leff asked:

Remind me why you think Hilton Honors is a better program than Marriott Rewards?

I will respond. First, in a Freudian slip, Leff said “Marriott Rewards”. However, “Marriott Rewards”, a much more competitive program that was quite similar to Hilton Honors, is no more. Second, it is appalling that one who anointed himself “thought leader in travel” would ask such a question when there is evidence all over the place that BONVoY is a failing program. Third, anyone who has been paying attention would have noticed that, currently, the dominant and last standing hotel loyalty program is unquestionably Hilton Honors, which has been rock solid, mature, and as rewarding as ever, with non-stop targeted and quarterly or “global” promos when other programs have offered few or none; a whole host of imaginative and innovative programmatic changes; and industry-leading co-branded credit cards that are now exclusively offered by AMEX after Citi petered out.

Lastly, once upon a time, there were two hotels loyalty programs, Starwood Preferred Guest (SPG) and Hyatt Gold Passport (HGP), that self-anointed “travel gurus” a.k.a travel bloggers, had inexplicably placed on pedestals and almost universally pointed to as “la crème de la crème” of hotel programs, while Hilton Honors and Marriott Rewards were constantly disparaged. Now look at what’s happened:

  • Starwood failed, went up on the auction and was acquired by Marriott, which initially bowed to the pressure to turn their own decent program, Marriott Rewards, into SPG, an expensive and unsustainable program that travel bloggers swooned over. The result has not been pretty: Marriott Rewards cum BONVoY sputtered so badly in its attempted makeover that they are no longer even trying, with the company’s CEO characterizing spoiled, demanding and highly vocal former SPG loyalist as “noise around the edges“. Ouch! SPG was the “best” loyalty program only if you believe in reverse Darwinism or the “demise of the fittest.” Well, there is no such thing.
  • HGP, another darling of ‘travel gurus’, underwent a wholesale metamorphosis, emerging as World of Hyatt or simply WoH!, which sounds about right as an expression of what they did with the program. Three elite levels with strange-sounding names were created, and the benefits were so tilted to the top elite level that WoH! is essentially a one-elite-level program, like HGP was but worse because there are now more levels, among which only one matters. But that was not all. Hyatt did not only stuff all the benefits in the program’s top elite level, they also made sure that only a limited number of die-hard members could afford those benefits by raising the qualification requirements to 60 nights or 100,000 base points for a program with the tiniest footprint. Ouch! And, some people consider WoH! to be a generous program! Yeah, right. It is easy to offer expansive benefits when only a limited number of people are targeted.

Contrast the preceding with Hilton Honors, especially in conjunction with its leading co-branded AMEX cards, and you will see that not Marriott, not even Hyatt, comes close to being as rewarding as Hilton Honors has been, consistently. Other than dropping an extra, superfluous and annoying ‘H’ from its name, Hilton Honors has remained stable and rewarding. In the meantime, other programs were rebranding with bizarre names like BONVoY; one program (SPG, R.I.P) outright failed; another program (BONVoY) is failing; and a third program (WoH!) has essentially become a niche or “boutique” program for the “affluent”.

Do you want to speak of “generosity”? How about a huge program that offers free breakfast not only to its very top elites, but also to all its mid-tier elites?

‘Nuff said!

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