Hyatt CEO Mark Hoplamazian was just interviewed by the Wall Street Journal, and he made some comments that I think a vast majority of World of Hyatt members would disagree with. Now, I’m actually going to ever-so-slightly defend him here, so let me explain.
World of Hyatt members don’t mind major points devaluation?
We recently saw World of Hyatt devalue its award chart considerably. While I’m grateful the program has an award chart at all (unlike Hilton Honors, IHG One Rewards, Marriott Bonvoy, etc.), there are now five tiers of award pricing within each of the eight hotel categories, and peak season award pricing has increased by up to 67%. In other words, the highest value awards just got a lot more expensive.
Hoplamazian was asked about the recent program changes, and here’s what he had to say:
WSJ: You have a very dedicated loyalty-member base. Are some of the recent changes to the program, like expanding from three tiers of redemption to five, a way to stealthily devalue points?
Hoplamazian: Frankly, the reaction’s been overall positive. We’ve maintained a fixed award chart, so you don’t have to guess. Some of our competitors and others in the travel industry have gone to a dynamic award chart.
We also have a very unique offering, which is “guest of honor,” which allows you to gift your status and your benefits to someone else that you really care about. And while we have adjusted a number of hotels, that’s the result of changes in average daily-rate levels and costs.
Hoplamazian is pushing it, but in his defense…
Let me start by saying that I respect Hoplamazian. He’s a stand-up guy, and I think among the major hotel groups with loyalty programs, he’s the one who best understands hospitality, genuinely tries harder, and is typically an honest narrator on the industry. Contrast that to Marriott CEO Anthony Capuano, who I imagine could be running a chain of Pizza Huts, for all he cares, as he’d focus on growth and margins over guest experience in the same way he does with hotels.
I frequently call out travel industry executives for gaslighting customers, and it’s something that some brands are particularly notorious for. For example, no one loves making a negative change and then claiming it’s an “enhancement” quite like Lufthansa Group.
The gold standard for communication is Air Canada Aeroplan. For example, the program is changing its award chart (mostly for the worse), and when communicating the change to media, they wrote “we don’t take increases lightly, but they’re sometimes necessary as our underlying costs rise.”
That’s how you do it, because that’s the truth. And I’m not surprised that kind of communication comes from Aeroplan, since Air Canada COO Mark Nasr is the person behind the program. He’s a huge airline and loyalty program nerd, so he understands things from the perspective of a member and customer, and that’s an incredibly underrated leadership skill.
Either Hoplamazian isn’t being truthful with his statement, or he’s really being shielded from member feedback. I don’t think I’ve ever seen an award chart devaluation at any program where the member feedback was “overall positive.”
Now, in Hoplamazian’s defense, here’s what I’ll say. This was a short interview with just four questions, and one of those was about the loyalty program change. Hyatt is trying to increase its margins and greatly grow World of Hyatt.
It’s not like Hoplamazian is going to say “our members are furious, but we just want to make more money,” or anything like that. I sort of take his answer as something that’s intended to brush off the question, with the “overall positive” being in reference to general member satisfaction with the program. As you can see, he immediately pivots to talking about how the program at least has an award chart, and then talks about the awesome Guest of Honor perk.
I do think there’s a difference between putting out a press release patting yourself on the back for a negative change, vs. what we’re seeing here, where it’s in response to an interview question. Again, I’m not excusing the response, it’s just not the most offensive gaslighting I’ve seen of customers… there’s lots of competition for that, admittedly!
Bottom line
Hyatt CEO Mark Hoplamazian just had an interview where he was asked about the recent World of Hyatt award chart devaluation, and he claimed member feedback was “overall positive.” That’s… obviously not true, and I wish he would’ve been more honest than that.
I get that this is just how the corporate world works, but it amazes me how often we see big companies spin negatives as positives. I’m not sure if they think they’re actually convincing us, if they’re trying to convince themselves of something, or what. In fairness, I’ve seen much worse offenses, and it was clear Hoplamazian wanted to change the topic.
What do you make of Hoplamazian’s devaluation comments?
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