Hotel Loyalty Schemes – Time For A Change


I have been traveling for business for about 15 years now and one thing I was introduced to very early on was the value of Loyalty Schemes with hotels, airlines and car hire companies.

Rack up enough points with the right hotel to reach that elite membership status and the front desks really do start to treat you differently. Free drinks, room upgrades, invitations to drinks and canapés with the management and so on. The best example I can give here is when we stayed in Budapest a few years ago as a family.

I had managed to score what I was sure was a mispriced room at the Intercontinental Budapest through American Express travel. From what I could see, Amex had forgotten to include the VAT. Of course this was for a small basic basic room. Upon arrival though, as soon as it became clear I held Platinum status in the Intercontinental Hotels loyalty scheme it didn’t matter that I had only paid £50 per night for the room. I was now an important guest and was promptly upgraded to a executive room with a river view and free drinks vouchers for the bar.

Add to this that the loyalty points also have a value themselves. Typically this means free hotel nights. So in the last 10 years, I can probably count the number of nights we have spent in hotels as a family where I have needed to pay anything on 2 hands.

The same applies to airlines. Membership status equates to better treatment and points result in free flights or upgrades for you and your family.

Indeed you can earn something on just about everything you spend. Cobranded credit cards, cash back debit cards, club cards converted to Airmiles and the list goes on and on.

So over the years I have tended to stay loyal to a handful of brands making sure I get that elite membership and maximise the free hotel nights and airline rewards.

On the hotel front I have stayed loyal to Intercontinental Hotels (IHG) as in the UK at least they have lots of properties (such as Holiday Inn, Holiday Inn Express and Crowne Plaza). And as with Budapest and with all the free nights my family has enjoyed it worked. I stayed many nights and got plenty back in return.

But over the last 3 years, even for somebody like myself who spends a lot of time away from home, reaching that coveted platinum status has become harder and harder.

First they made changes that meant that not all the points you earned counted towards status. Then they started bringing out “tailored” bonus points schemes that set impossibly high goals that I needed to reach for a few extra points. Points by the way that did not count towards status.

Last year (2014) I spent over 50 nights in IHG properties which is what you need to make Platinum. The tailored bonus point scheme suggested I spend at least SIX Saturday nights in their properties over a period of Twelve weeks to earn an extra 5000 points (I can earn 2000 points for a 1 night stay anyway). Somebody is having a laugh. Do they not think I spend enough nights with them already without giving up 1 in 2 weekends as well?

And the other schemes both with hotels and airlines are all at it.

Every week I am reading about yet another loyalty scheme that has devalued the rewards or changed the criteria needed to attain that top tier status.

One thing that is obvious however is that you can bypass all of this by taking out a cobranded credit card instead.

So this year has seen a change in my travel habits anyway. I am flying more and am staying in regions very different to where I traveled to previously. Indeed as I write this I am about to jump on a plane to Singapore for the second time this year but that has made me review my loyalty to these companies. Clearly they take my loyalty to them for granted.

So I am giving up on top tier status chasing. The rewards are getting slimmer and slimmer and when you only get that free upgrade occasionally these days, it’s not a good enough reward. My thinking is that if I can get to Silver status (on a grading of bronze, silver or gold/platinum) then I will get the recognition that I am a regular user of a particular chain and get treated better than somebody who booked through lastminute.com. That’s good enough. If I want the status bad enough I can take out the cobranded credit card which is a lot less effort than spending 60 nights in a Holiday Inn Express or Crowne Plaza. After all, nobody says you actually have to use the credit card once you have got it.

Points on the other hand are important so I will make sure that whatever hotel I stay in, I am collecting the points. Likewise I am ensuring that every penny I spend is either getting cash back or points that are actually worth something to me.

But by doing this and cutting my allegiance to a particular chain, I am able to be more creative on where I stay.

So this week in Singapore I could have stayed where I did in January and where I now have Platinum status. I could have booked a standard room and then seen a free upgrade due to status to a executive room. But instead, by choosing a different hotel in a chain I have never stayed in before I was able to get a Club Room on the Club floor in a location closer to the office I am going to be working out of for S$30 per night less. As I am staying in the hotel for 9 nights, access to the club lounge with free bar and a free breakfast is much more useful to me.

I will still collect the points which in this case can be turned into cash if i return in the future but for now it’s about getting the best deal for the best room with the points coming second and status last.

Yes I will be making sure that I am getting the best return on my spend in terms of points and rewards but the hotel chains have managed to persuade me that status no longer has a value and my loyalty is taken for granted. It looks like those free nights and perks will be spread across more brands this year.

Feature photo used under Creative Commons License via Flickr Photo used under creative commons license via Flickr https://www.flickr.com/photos/booleansplit/

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