Book now, before your hotel rewards disappear

Fri Mar 8, 2013 10:12am EST

A general view of the Hilton hotel in the Universal City area of Los Angeles July 3, 2007. REUTERS/Mario Anzuoni

A general view of the Hilton hotel in the Universal City area of Los Angeles July 3, 2007.

Credit: Reuters/Mario Anzuoni

Related Topics

(Reuters) - If you've been hoarding hotel rewards points for your next vacation, you could be in for a jolt when you try to book your free room. Most of the major hotel chains have either devalued their points already or will soon.

"This is the worst year I've seen for this," says Brian Kelly, of ThePointsGuy.com, a website that monitors loyalty programs. "It has been a really bad year for hotel points."

Blame the travel industry rebound, says Kelly and others. Demand and prices are rising, so hotels no longer need points-toting guests to fill their rooms.

The main takeaway for loyalty program travelers? Book as soon as possible, lest your points lose their power.

Changes to the Starwood Hotels & Resorts Worldwide Inc program took effect on Tuesday. Hilton Worldwide Inc changes go into effect March 28. Marriott International Inc changes start May 16. InterContinental Hotels Group Plc changes started in January but the company says it will honor the old rates until March 18. Wyndham Worldwide Corp starts its new plan on March 14.

What do the changes look like? Here's one example: A free night at the New York Hilton will cost a HiltonHonors member 60,000 points this month but 80,000 points next month.

Wyndham's list of hotels that will take more points to book after March 14 spans 215 pages -- though it also lists 42 pages of hotels that will require fewer points. (Changes tend to be based on supply and demand, so dropping the points required could help fill beds in a less desirable property.)

Kelly says he has been planning a trip to the Maldives that would cost 50,000 points a night under Hilton's current plan and 95,000 points a night under the new one. He's racing to finish booking the excursion by March 27, even though he's not traveling until April 2014.

'A SUCKER'S GAME'

So, what do you do if your hotel rewards program has announced a change? Make your move fast.

"Always book before these changes go into effect," Kelly says. You don't have to complete the travel before the program changes, you just have to book it. In fact, you can often book stays as far as a year in advance.

Don't build up a huge pile of points that can't quickly be converted into a reward, says Tim Winship, editor and publisher of FrequentFlier.com, because points can always be devalued.

"Hoarding your points or miles is really a sucker's game," says Winship.

It is also a good time re-evaluate your loyalties, he says. Just because you've always booked at one chain doesn't mean you need to stick with it, so compare your rewards deals with bookings elsewhere.

"Always be ready to jump ship if your program gets out of alignment with what's going on industrywide," he says.

You can also use up points by upgrading your rooms. That's a favorite strategy of Dan Sondhelm, 40, a Washington, D.C., marketing consultant who has been a Starwood loyalist for about a decade. But he now fears that Starwood plan changes will hurt that strategy.

Starwood Senior Vice President Chris Holdren says top-level players like Sondhelm, who stays at Starwood hotels up to 30 times a year, won't notice the changes.

HOTELS BOUNCE BACK, GUESTS PAY

Tinkering with points programs is an annual exercise, but those who closely follow hotel points say this year's restructuring was extraordinary.

After some rough years, hotels are feeling a bounce-back, says Maryam Wehe, senior vice president at Applied Predictive Technologies, which works with 13 of the top 25 hotel brands. "Now, what you're seeing in the hotel industry is that demand is perceived to be pretty much there ... and the hotel industry is looking at increasing their rates."

Those rate increases are a big part of the reason why points are being devalued. Another, says Kelly, is that consumers have accumulated so many points through credit card offers that the travel companies want to clear them off their books.

COMPLAIN EARLY AND OFTEN

If you've been affected by the changes, don't just roll over, Kelly says. "Complain to the hotel loyalty programs and complain to the credit card companies. That's what is really going to get the hotel companies to put the brakes on these changes."

Credit cards that are paired with loyalty programs and offer bonuses for signing up or for usage become less lucrative when points are devalued. So, for example, if you have a Hilton credit card through American Express and you are a HHonors program member, you should turn to both to voice your dissatisfaction.

Hilton spokesman Scott Carman says the company notified its members five weeks ahead of the changes and added some enhancements, like a fifth night for free if you redeem four nights. "Like all loyalty programs, we periodically make changes to the HHonors program," he says.

Intercontinental spokeswoman Monica Smith says about 40 percent of its hotels stayed at the same level in the recent round of changes, while 30 percent went up and 30 percent went down.

But add it all up, and members will give up more than they gain from all of these program changes, says Kelley. "There are many more losers than winners."

(Follow us @ReutersMoney or here Editing by Linda Stern and John Wallace)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.