Frequent Miler on the Air - Which hotel program is most rewarding for paid stays? | Coffee Break Ep23 | 8-27-24

Starting point is 00:00:00 Here we go. This is not your typical frequent miler on the air episode. This is a standalone segment we're calling Coffee Break. Each Coffee Break segment will cover a single topic related to miles and points. And each Coffee Break is limited to 20 minutes or your money back. Enjoy. Today's coffee break. Which hotel program is most rewarding for paid stays? Now, we like to use our points and free night certificates for stays, but we know some people out there occasionally book paid stays. And to be honest, we do too every now and then. And so we took a look at, we did a deep dive and looked at which ones offer the most like

Starting point is 00:00:50 points and the most rewarding points for paid stays. And we're going to cover that today. Yeah. In fact, I just wrapped up a paid stay this morning, checked out of a paid Hyatt stay this morning. So it'll be great to find out whether I made a good choice in paying for a Hyatt stay over another brand. So we'll talk great to find out whether I made a good choice in paying for a Hyatt stay over another brand. So we'll talk more about that today.

Starting point is 00:01:07 Don't forget, you can subscribe to our email list and all our various podcasts and whatnot. If you go to frequentmiler.com slash subscribe, join our email list and check out all of our different podcast types. This coffee break is a 20 minute segment, but if you like longer ones, we have those. And if you like shorter ones, we've got card talks also. So lots of different stuff on this channel. All right, let's get into this week's topic. So how do we know or how do we even determine which is most rewarding? Because they all offer different numbers of points, right?

Starting point is 00:01:34 So, I mean, this one might be three or six or nine or 12 or 15. How do you even compare apples to oranges in a fair way? Yeah, that's a great question because the points are not equal. When you look at Hyatt points and compare them to Hilton points, for example, despite the commonality in the first letter of the names, the points are very, very different in value. We see Hyatt points being worth at least three times Hilton points on average. And so you have to take that into account. And the way we do that, we have these values that we call reasonable redemption values. And basically we look at the different hotel chains, look at a number of stays in the United

Starting point is 00:02:20 States. And we do that because most people redeem their points in the United States, most US residents do. And so we figured that would have the most applicability to the most people. And we determined the midpoint, the median point, cents per point value you get based on the data we looked at. And the idea is like when we say that the Hilton reasonable redemption value is 0.48, which is basically half a cent. What we're saying is you have about 50% chance of getting better value than that, better than half a cent per point value, but you also have 50% chance of getting that or lower value. So that's what that is. And that's the number we use to try to compare apples to apples across these. Some other things that you should know.

Starting point is 00:03:17 The analysis we did does not consider elite benefits. So we're not looking at, you know, oh, Hyatt's more valuable, more rewarding because you get, you know, waived resort fees if you have globalist status, for example. That's true, but that was not considered in this analysis. We also did not consider promotions. So as an example, Hilton often has double points promotions, and that could make stays much more rewarding, but those are not considered. So we're only looking at how many points do you usually earn per dollar with paid stays? So first up, we looked at without using a hotel credit card, without having any elite status with all the chains we looked at, which ones were most valuable. And three chains were on top and all around 10% back for your

Starting point is 00:04:16 spend. Hyatt is probably the best known of these. Sonesta and Wy windom are the three that came in around 10 so if you're not using a special hotel credit card and you're you don't have any elite status those are the three uh that came out on top that said uh you know the next one's down you're looking at eight percent seven percent like it's not that much lower if you're going with another chain so i'm not sure if if you're not using a hotel credit card, you don't have a lead test. I'm not really sure it matters all that much, which one you go with, to be honest. Yeah, that's a good point. That's an important point, I think, for people that that are kind of newer to the game anyway, that the return is similar,

Starting point is 00:04:59 about the same or pretty close to it with each of these programs, if you don't learn how to play the game a little bit. So it won't really matter so programs if you don't learn how to play the game a little bit so it won't really matter so much you don't necessarily need to pick one you in in in that case you know if you're not going to have a credit card or you're not going to have status of some sort then you may as well pick the place you actually want to stay because the return on points is probably going to be about the same any way you slice it so but do sign up for the hotel loyalty program because it's not worthless. You know, it's certainly worth collecting something. Oh yeah. I mean, even 10%, it can be

Starting point is 00:05:31 a decent return and, you know, over time that's, that's terrific. Another thing I should have mentioned at the outset that was not included here, but can be a big factor is portal rewards. We did not look at the potential of earning rewards by clicking through a portal before booking your stay. And that can be considerable with some of these. So especially like IHG and Choice seem to be two that show up a lot in portals and sometimes with very high rates. So that's something else to consider that could make a big difference. Okay. The next analysis we looked at is if you have top tier status with each of these chains, which one is the most rewarding? And so I think this would be, this analysis is probably most applicable to people who, you know, maybe they're consultants

Starting point is 00:06:24 who travel a lot and they have the freedom to pick which chain they spend the most time with. And so they're going to be, they're going to have top tier status because they spend a lot of time there. So which one will be most rewarding so that they can then use those rewards for their And here it was pretty shocking how big Sinesta won out on that one. Craig, I've been trying to tell you, don't take a siesta on Sinesta. And here it just proves to be true yet again. Yeah, yeah. Sinesta showed up with 21% return if you have top tier status with Sonesta on a paid stay, and that's not including any credit card rewards in that. And to give you an idea how big that is,

Starting point is 00:07:13 it's close to double the next level. So the next level, IHG, Marriott, and Wyndham all showed up at around 12% and Hyatt at 11%, Choice and Hilton at 10%. So all the rest are closely glumped into that 10 to 12% range. Senesta at 21%. It's just really crazy. So I don't know. What's the takeaway there that like, I mean, Senestas are not everywhere. Right. Right. I mean, I think you just have to be invested in the Senesta footprint. Like, I mean, senesces are not everywhere. Right, right. I mean, I think you just have to be invested in the senesce footprint. Like, I don't know. So the takeaway there is all that significant for me, because, boy, I think it would be tough unless unless you have some sort of business where you are very frequently traveling to a few places that have a lot of senesces and you also want to vacation in those places.

Starting point is 00:08:03 It would still be hard for me to choose Sinesta. But the thing is, if it does work for you, then it's really nicely rewarding. So it's worth taking a look if you are one of those traveling consultants, salespeople, business person that's on the road a lot, taking a look and seeing does Sinesta have a lot of coverage in the places I go to? And if they do, how can I get top tier status and earn a good return? And where would I be looking to use the points later on? Because, you know, Sonesta isn't when we say it isn't everywhere, we really mean it isn't everywhere. There's a lot of places where there's no Sonesta at all. So how exciting that's going to be for you is going to vary. But for some people, that'll be great. I mean, 22% back, especially if you're traveling a lot for business, $100 back,

Starting point is 00:08:45 plus 100, more than $100 back every time you spend 500. I mean, that'll add up pretty quickly. So I think that's interesting, but not a catch all solution. Right, right. All right. So then the third analysis we did, I think is most applicable to most people in that. So a lot of hotel credit cards give you status, elite status automatically. And they also usually give you more bonus points if you pay with that credit card at their own hotels. And so we looked at that combination. We looked at like all the main credit cards in the US that are hotel specific and, you know, analyze based on the idea, you have the level of status the credit card gives you,

Starting point is 00:09:29 plus you're gonna earn not just the number of points you get for having that status, but also the points you get by using that credit card for your spend. So that combination. So now here, Sonesta still stayed on top with a 22% return, but now the next one up is not far behind. We've got the Wyndham business earner card at 20%. So yeah, so that one is really close. Then the personal Wyndham earner plus is not that far behind at 18%. Yeah, so I think that's interesting. And now,

Starting point is 00:10:03 of course, those are at 20 and 18%, not just because of the return on spend on the card, but because of the status you get from having the card. So the Windham earner plus, if I remember correctly, gives you automatic Windham platinum status, I think is what it is on the consumer card, right? If you get the business card, then you get top tier Windham diamond status. And so that's the difference between the 20 and the 18%. It's whether you end up with diamond status and the multiplier from the card or platinum status and the multiplier from the card. That's right. Exactly right. Then the next number of cards and hotel combos give you 16% return, which is still pretty good. and not that far from Sinesta's 22%, I guess.

Starting point is 00:10:48 So in that 16% range, you've got Hyatt with the World Hyatt card. You've got the Hilton Aspire card. You've got the IHG Premier and the IHG Premier business cards. All of those will net you 16% returns if you use those cards for your stays. And what you have to consider here now is that, yes, that's 6% less than Sonasta, but you're also gaining a lot in the sense that you're getting

Starting point is 00:11:17 much wider footprints than Sonasta. And then also potentially other side benefits if you're actually staying some enough to earn milestone rewards and that sort of thing, which I think we'll probably come back to. But at any rate, it might bridge the gap. Like the convenience factor alone might bridge the 6% gap there, I think. Pick your poison in terms of which of those programs matters to you. Right.

Starting point is 00:11:40 And with IHG specifically, portal rewards can easily bridge that gap easily. We often see 8% or higher with IHG. The next up, right below the 16 percenters, you've got the Bonvoy Brilliant card that's with Marriott at 15%. So that one gives you automatic platinum status, which is why that one does reasonably well. And then right below that at 14%, you have the Hilton, the other Hilton cards, the Surpass and the Business card. And they give you less than the Aspire because they give you gold status instead of diamond status, which the Aspire gives you. Aspire also gives you 14 points per dollar instead of, I think these give you 12, if I remember right.

Starting point is 00:12:28 Yeah, yeah, yeah. So it's a 2% difference between the extra two points that you'd get with the Aspire and the difference in status. So pretty low difference there. But I think it's interesting to show that all of these programs come out pretty darn close. I mean, if you take Synest out, they are well ahead, but they need to be, right? The whole idea is if you have a smaller program, you need a more generous rewards program in

Starting point is 00:12:51 order to attract people to choose your program over others. So it makes sense to me that Sinesta is far ahead, even though it was surprising to all of us. I think it makes sense. They need to incentivize people. The other programs are all pretty darn close. The 14, 15, 16%. Again, portal rewards might make the difference there, location of the hotel that you want, et cetera, or the hotels that you want to stay at. So I think it's interesting that they

Starting point is 00:13:17 all are so close in terms of the percentage level. Yeah. Yeah. And so let's talk about now, the analysis didn't consider this, as we said, like it didn't consider if you care about elite status, for example, it can be worth earning less rewards in order to get to a higher level of elite status in order to benefit from elite benefits, right? And not only that, some of these programs have milestone rewards, which are specific, valuable rewards that you get at certain numbers of stays, number of days stayed. For example, at Hyatt, you might earn free night certificates, you might earn suite upgrade certificates, things like that. IHG, you can earn suite night certificates you might earn sweet upgrade certificates things like that ihg you can earn sweet upgrade certificates and marriott you can earn some things that aren't as valuable as what high hd and ihd offer but you can offer uh earn uh like a free night after 75 nights so you can earn um and you can earn some uh daily up upgrade

Starting point is 00:14:22 nightly awards or something i forget what they call them yeah yeah which you forget because that's how valuable they uh usually are although they can be sometimes very valuable they're harder to use though and harder to get good value out of yeah i mean i think all those things matter and so i think that interestingly if you're not going to go for top tier hyatt status then i think you probably opinion would be, it would make more sense to focus on either Marriott or Hilton or maybe IHG. So IHG, my argument for IHG would be if you're going to stay at least 20 nights a year, but not a lot more than that, then IHG might be the right choice for you because the milestone rewards, the suite upgrades start at 20 nights. And so that

Starting point is 00:15:02 might be worth it if you're going to spend about 20 nights a year. Although if you're going to spend about 20 nights a year, then you have to consider, well, if I get the two right Marriott cards, then I can end up with platinum status from Marriott with 20 nights stayed plus the elite nights from getting a couple of the credit cards. So you have to kind of compare as to which footprint works better for you and which elite program works better. But with Marriott, then you'd be getting free breakfast at a lot of places. Of course, you can get the Hilton diamond, you know, the Hilton gold status or better with any of those credit cards we mentioned and get free breakfast ish or food and beverage credit anywhere. So, so I think you just have to start considering those things when it comes to comparing one

Starting point is 00:15:40 versus another. Do you, do you have a favorite among them here? I have a favorite. Well, it's so hard. I mean, Hyatt is by far my favorite when it comes to if you're going to earn, let's say 40 nights, because that's when the really big rewards kick in with Hyatt. You have the suite upgrades that are bookable at the time of booking, that confirmable at the time of booking. You have the Guest of Honor Awards, where even if you don't have top tier global status, you could use that Guest of Honor Award for yourself and have a top tier stay, which has all kinds of great perks. So that's probably my favorite program, but you have to get to 40 nights. So the bar is much higher than some of the other programs, as you were saying. Marriott and IHG, you get

Starting point is 00:16:32 meaningful rewards at lower numbers of days stayed as long as you have the right, in Marriott's case, you have to have the right credit cards to make that happen. Yeah, yeah. And I think it's probably worth mentioning here that with Hilton, you don't really need any stays at all because the credit cards are going to give you the elite benefits and milestone rewards are not nearly as well defined. So that may not matter so much to you. But the other thing that is worth mentioning here that we missed, I think, is that with some of these, you'll earn elite nights based on spend with the card, depending on which card you have. And so Hyatt is the easiest example to explain out of those because you'll get two elite nights for every 5,000 spent on the consumer card. You get the business card, and I think it's what, three elite nights for every 10K spend? Or no,

Starting point is 00:17:17 I'm sorry. It's five for 10K spend. Five for 10K spend. I knew I had that wrong as soon as I said it. So you can earn some nights that way that count towards elite status and those milestone benefits. And so that might make a difference also in terms of which one. So it's very complicated. I think choosing which loyalty program is right for you gets complex. I think the big takeaway here is that they're all pretty close when you're using the card and whatever status comes with the card.

Starting point is 00:17:45 There's not a huge difference there. But I think, you know, another interesting takeaway is if Sinesta works for you, it's hard to beat. Yeah, it is. And also that the fact that Wyndham showed up pretty high on this as well, that if Wyndham works for you, it's a pretty rewarding chain. And as we've mentioned many times times the credit cards are very rewarding as well yep very good all right i think that brings us to the end of this week's coffee break if you enjoyed it and you'd like to get more of this stuff in your email inbox go to frequentmiler.com subscribe check out our full-length frequent miler on the air episodes our shorter card talk

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Frequent Miler on the Air - Which hotel program is most rewarding for paid stays? | Coffee Break Ep23 | 8-27-24

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