Hilton Honors seems to have raised award costs at many of its more expensive properties, which members certainly won’t be happy about.
Hilton Honors devalues points at many properties
For several years now, Hilton Honors hasn’t published award charts. While the program has dynamic award pricing, the reality is that the most expensive award rates at a particular hotel have been pretty consistent. That’s to say that if a standard room is available, you can redeem points for it at a fixed (but unpublished) cost.
As reported in this FlyerTalk thread, it would appear that on Friday, December 20, 2024, Hilton Honors has increased the points requirements for standard room redemptions at many of its properties. This doesn’t seem to impact all properties, but rather seems to impact some of the more expensive properties in the portfolio (let’s say those retailing for 70,000+ points per night for a standard room).
The increases seem to be anywhere from 5,000 to 20,000 points per night, depending on the property. For example, the Waldorf Astoria Los Cabos used to cost 120,000 points per night for a standard room, while it now costs 140,000 points.
Meanwhile the Conrad Osaka has increased in cost from 95,000 points per night, to 100,000 or 105,000 points per night.
That brings us to the second interesting thing about this change, which is that Hilton Honors now seems to have different “tiers” of standard award pricing at some hotels. Up until now, standard room redemptions at a particular property cost a certain amount, assuming there was availability. Now you’ll notice that some properties have either two or three tiers of pricing.
In some cases those pricing tiers are 5,000 points apart (like above, at the Conrad Osaka), while in other cases the pricing tiers are 20,000 points apart (like below, at Zemi Beach House Anguilla).
As a reminder, those situations where you see super high award costs are for premium room rewards, which are in situations where there are no standard rooms available. That pricing is totally dynamic, and generally doesn’t represent a good deal.
Hilton’s standard room award pricing maxes out at 150,000 points per night, for properties like the Waldorf Astoria Maldives. Fortunately that cap hasn’t been raised with this devaluation, and that’s still the maximum you’ll pay. It’s also nice how Hilton Honors free night awards remain uncapped, so aren’t impacted by devaluations.
These changes are unfortunate, but not terrible
Of course nobody is happy to see their points be worth less, so these changes aren’t good for anyone. However, if there’s any silver lining, I’d say that these changes could have been worse. Personally I value Hilton Honors points at 0.5 cents each, so an increase of 5,000 or 10,000 points per night is like paying an extra $25-50 per night. Furthermore, it has been quite some time since Hilton had a widespread increase in points cost, as we’re seeing here.
It’s also not surprising to see Hilton introduce some variable pricing for standard rooms at particular properties. I’m kind of surprised the pricing “gaps” aren’t bigger, as we see with other programs (like with Marriott Bonvoy or World of Hyatt).
If you want to make sense of hotel award pricing, it’s worth understanding how the economics of hotel loyalty programs work. Keep in mind that most hotels are independently owned, so the major global hotel loyalty programs have to compensate individual hotels for each redemption:
- When the hotel isn’t full, the loyalty program compensates the hotel at some reimbursement rate that’s slightly above the marginal cost of servicing a room, etc.
- When the hotel is full (think 90-95%+ occupancy), the loyalty program compensates the hotel close to the average daily rate, in recognition of the fact that the room may have otherwise been sold
The award price increases we see at high end properties reflect the continued strong demand for premium leisure travel. We’ve seen room rates at many top luxury properties increase significantly since the start of the pandemic, so hotel loyalty programs also have to make the math work on that.
Bottom line
Hilton Honors has quietly increased award costs at some of its more expensive properties. For standard room redemptions, many properties have increased in price anywhere from 5,000 to 20,000 points per night. On top of that, we’re starting to see variable award pricing, whereby standard award costs at a particular property might fluctuate by 5,000 or even 20,000 points per night, depending on the day of week or time of year.
No one likes a devaluation, and this isn’t good. However, it’s also not terrible. Either way, it’s worth acknowledging, in case you’ve been looking at properties, and suddenly notice higher costs.
What do you make of Hilton Honors increasing award costs at some properties?
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