World of Hyatt is my favorite hotel loyalty program, and Globalist with them is my favorite top tier status. The program has maintained its value pretty well, though some significant changes are coming.
World of Hyatt program updates have just been announced for 2020, so let’s look at the details.
Hyatt Introducing Peak & Off-Peak Awards
As of March 2020, World of Hyatt will introduce off-peak and peak points redemption rates for free night awards. Under this structure there will be three points redemption values:
- Off-peak: Fewer points will be required during off-peak times, starting at 3,500 points per night
- Standard: Points required during standard redemption periods will follow today’s point requirements, starting at 5,000 points per night
- Peak: When hotels are the busiest, more points will be required for a free night, starting at 6,500 points per night
Award redemption rates are going up during peak periods
Hyatt’s New Peak & Off-Peak Award Charts
With these changes, we’re seeing peak and off-peak redemption rates introduced for free night redemptions for standard rooms, club rooms, standard suites, premium suites, and Points + Cash. On top of that, this variable pricing will also be introduced for all-inclusive properties, including Miraval.
The only types of awards that won’t see peak & off-peak pricing are room upgrades, to either club rooms or suites.
So let’s take a look at the new award charts:
New Redemption Rates For Standard Rooms
For standard room free night redemptions, we’re seeing a minimum difference of 1,500 points and a maximum difference of 5,000 points for peak and off-peak redemptions compared to standard rates:
New Redemption Rates For Club Rooms
For club room free night redemptions, we’re seeing a minimum difference of 1,500 points and a maximum difference of 5,000 points for peak and off-peak redemptions compared to standard rates:
New Redemption Rates For Standard Suites
For standard suite free night redemptions, we’re seeing a minimum difference of 1,500 points and a maximum difference of 5,000 points for peak and off-peak redemptions compared to standard rates:
New Redemption Rates For Premium Suites
For premium suite free night redemptions, we’re seeing a minimum difference of 3,000 points and a maximum difference of 10,000 points for peak and off-peak redemptions compared to standard rates:
New Redemption Rates For All-Inclusive Properties
For standard rooms at all-inclusive properties, we’re seeing a minimum difference of 3,000 points and a maximum difference of 4,000 points for peak and off-peak redemptions compared to standard rates, plus a difference of 1,500-2,000 points for an extra guest:
Meanwhile for standard suites at all-inclusive properties, we’re seeing a difference of 5,000 points for peak and off-peak redemptions compared to standard rates, plus a difference of 1,500-2,000 points for an extra guest:
New Redemption Rates For Miraval
For Miraval properties, we’re seeing a difference of 5,000-10,000 points for peak and off-peak redemptions compared to standard rates, plus a difference of 2,000-2,500 points for an extra guest:
How Will Peak & Off-Peak Dates Be Regulated?
Hyatt tells me:
- Free night redemption rates will be identified as peak, standard, or off-peak as soon as nights are available for reservations (about 13 months in advance), and they won’t change once posted (unlike Marriott, where it’s dynamic)
- The decision for peak and off-peak pricing is based on the geographic market, meaning that all properties within the same market will adhere to the same calendar
- There is no minimum or maximum number of nights that a property can designate as peak or off-peak
- The majority of days will be set to standard redemption rates each year
- Hyatt will be introducing a calendar where members can look at award rates over a longer period of time
Hyatt isn’t doing much to regulate peak and off-peak dates
What Happens To Existing Reservations?
If a World of Hyatt member has an existing award booking for a night that changes to off-peak in March 2020, they will receive an automatic refund of the points difference. Meanwhile members won’t be charged if their existing award booking changes to peak.
If you change an award after the system goes into effect, you’ll be charged at the new award rates.
What Happens To Free Night Certificates?
Currently Hyatt issues category-specific free night certificates, some of which are valid at 1-4, 1-7, etc. These will continue to be valid at those categories, even in peak season.
Why Is Hyatt Making These Changes?
In case anyone is wondering what’s in it for World of Hyatt to switch to peak and off-peak pricing, this all comes down to the economics of hotel loyalty programs.
While Hyatt manages their portfolio of hotels, they don’t actually own a vast majority of them, but rather the hotels have individual owners, with individual profit goals.
When you redeem points at a Hyatt property, the amount that the hotel is reimbursed by the loyalty program can vary greatly:
- If the hotel is full (or nearly full) and you’re potentially displacing a “paid” guest, World of Hyatt compensates the hotel right around the average daily rate
- If the hotel isn’t full (and therefore you’re just occupying a room that would have otherwise been empty), World of Hyatt reimburses the hotel at a much lower cost, just a bit above the marginal cost
While peak and off-peak pricing will probably loosely reflect the seasonality of hotels, I expect it to largely reflect Hyatt’s redemption costs, which are much more about occupancy levels than rates at a given hotel.
Hyatt’s redemption rates are way higher when a hotel is full
Dining & Spa Awards Get More Valuable
While the introduction of peak and off-peak pricing is bad news, there is some good news as well.
As of January 29, 2020, World of Hyatt will be improving the value proposition of their dining and spa awards.
Specifically, you can redeem World of Hyatt points for US dollar credits towards dining, spa, and in-room purchases.
Historically this hasn’t been a good value at all. I value World of Hyatt points at 1.5 cents each, and the best value proposition was being able to redeem 120,000 World of Hyatt points for a $1,000 credit. That’s like getting just ~0.83 cents per Hyatt point.
Well, going forward the value proposition is getting significantly better. You’ll be able to redeem World of Hyatt points for anywhere from 1-1.54 cents each towards spa and dining credits.
For example, you’ll be able to redeem 1,000 points for a $10 credit, and 65,000 points for a $1,000 credit. On the high end that’s really good, as you’re getting 1.54 cents of value per World of Hyatt point.
Being able to redeem Hyatt points towards on-property expenses right around where I value them is a great new opportunity.
Redeem points at an efficient rate for on-property benefits
Here’s the new dining and spa award chart:
|Points Required||U.S. Dollar Credit|
My Take On These Changes
It goes without saying that Hyatt’s introduction of peak and off-peak pricing will be bad news for most members. Those maximizing their hotel points are often redeeming in peak season, since that’s when you get the most value.
While this is unarguably a negative development, dare I say that I think things could have been worse? I redeem for standard room free night awards most often, and those are going up by 5,000 points per night at most.
That’s not great, though I also feel like things could have been worse? I’ll certainly still get value from World of Hyatt.
I think my bigger issue is that Hyatt isn’t regulating how many nights can be peak and off-peak. Obviously I’m concerned that some hotels will just have peak dates for half the year, standard rates the other half of the year, and no off-peak dates.
But we’ll have to wait and see how it’s implemented. I find that most Hyatt hotels act in good faith, so I don’t think that will happen, but you never know…
World of Hyatt is still a great program, in my opinion
Earning Hyatt Points Is Still Easy
One of the reasons that I find World of Hyatt to be so valuable is because of how easy the points are to come by.
First of all there are lots of credit cards that potentially earn them. In addition to being able to earn World of Hyatt points with The World of Hyatt Credit Card (review), you can also transfer over points from Ultimate Rewards. Being able to efficiently transfer credit card points to Hyatt makes a world of difference.
See this post for everything you need to know about earning Hyatt points with credit cards.
Hyatt is introducing peak award pricing as of 2020, which is ultimately bad news. The most popular redemption times will go up in price, while we’ll see the cost of some (less popular) redemptions go down.
I do feel like changes could have been worse, though who knows what else will eventually come from World of Hyatt.
On the plus side, being able to redeem Hyatt points for over 1.5 cents each in some cases towards on-property dining and spa credits is an opportunity that many may find valuable.
What do you make of these World of Hyatt changes?