Marriott Bonvoy is continuing to worsen the value proposition of some airline mileage transfers, which sets a bad precedent. We saw the first of these changes kick in as of November 1, and now we’ll see another change as of December 1.
In this post:
Marriott ends 5,000-mile transfer bonus for some partners
One of the nice things about Marriott Bonvoy is that it’s the only hotel loyalty program where you can efficiently convert hotel points into airline miles without losing much value.
With Marriott Bonvoy’s airline mileage transfer program, you can transfer Bonvoy points to over three dozen airline miles at a 3:1 ratio. There’s an incentive to transfer Bonvoy points in increments of 60,000.
With the 3:1 ratio, you’d ordinarily earn 20,000 airline miles when converting 60,000 Marriott Bonvoy points. However, historically Marriott has offered a bonus of 5,000 miles when transferring 60,000 points, meaning that 60,000 points converted into 25,000 airline miles, giving you a real transfer ratio of 2.4:1.
This is in the process of changing. As of November 1, 2022, Marriott Bonvoy stopped offering the bonus of 5,000 airline miles for the following three partners:
- American AAdvantage
- Avianca LifeMiles
- Delta SkyMiles
Now as of December 1, 2022, Marriott Bonvoy will stop offering the bonus of 5,000 airline miles for the following partner:
- Korean Air SkyPass
With this change, when you transfer Bonvoy points to those partners, the ratio will be 3:1, regardless of the increments in which you do so. That obviously takes away quite a bit of value. On top of that, this sets a bad precedent, especially with this happening to a fourth partner as of December.
This is the first real devaluation we’ve seen to Marriott Bonvoy airline mileage transfers in a long time, and this has historically given the value of Bonvoy points quite a bit of stability, especially in light of other devaluations.
Why would Marriott Bonvoy devalue these transfers?
I’m always curious about the motivation for loyalty program changes, and this is no exception. Why would Marriott Bonvoy suddenly devalue the efficient transfer ratios for just a few of the over three dozen partners? The way I view it, here are some of the possible explanations:
- These programs raised the cost they wanted to charge Marriott Bonvoy for mileage transfers, and as a result that’s being passed on to consumers
- These are the airline partners that Marriott Bonvoy members transfer the most points to, and Marriott wanted to reduce its costs associated with these transfers
- These transfer partners strong-armed Marriott into discouraging members to make these transfers, because they felt this was cannibalizing their other revenue streams somehow; also keep in mind that Marriott Bonvoy and United MileagePlus have a special partnership, so I wonder how that plays into this
- Marriott is progressively going to keep removing this from more partners over time, but doesn’t want to rip the band-aid off all at once
If I had to guess, I’d assume the answer is probably a combination of some of these points. I wouldn’t be surprised if these are the mileage transfer partners that cost Marriott the most, in terms of a combination of cost per mile plus frequency of transfers.
I also think that with Marriott Bonvoy having otherwise been devalued, we’re going to see devaluations to this feature over time as well. This is something that has otherwise been a constant for many years, so it’s not surprising to see this eventually change, unfortunately.
Bottom line
Marriott Bonvoy is devaluing points transfers to four airline partners. Specifically, the bonus of 5,000 airline miles for transferring 60,000 Marriott Bonvoy points has been eliminated for American AAdvantage, Avianca LifeMiles, and Delta SkyMiles, and the bonus for transferring to Korean Air SkyPass will be eliminated shortly.
This sets a concerning precedent, since the ability to convert Marriott points into airline miles helps create a floor value for the program.
What’s your take on Marriott Bonvoy devaluing select mileage transfers?
Converting hotel points to airline points was always a bad deal
Yup. Allowing third party points to enter or leave a hotel loyalty program's ecosystem without any restrictions is, economically speaking, a loser.
Starwood suffered by allowing the starpoint to be earned on non-hotel spend and then making their transfer to airline miles ridiculously favorable. What was the upside of such a scheme for Starwood? None. The chain simply became a bystander in the activities...
Yup. Allowing third party points to enter or leave a hotel loyalty program's ecosystem without any restrictions is, economically speaking, a loser.
Starwood suffered by allowing the starpoint to be earned on non-hotel spend and then making their transfer to airline miles ridiculously favorable. What was the upside of such a scheme for Starwood? None. The chain simply became a bystander in the activities of its own points currency and loyalty program, thus squandering all the advantages of what was supposed to be its "cash cow". That is what Marriott just stopped with this move to cripple the transfer of its points to airline miles.
The flip side of the SPG model is the transfer of bank points to World of Hyatt points. Here again, points (e.g., Chase UR points) earned with any credit card elsewhere rather than on revenue stays at Hyatt hotels are used to book award stays at Hyatt hotels, thus making the chain a bystander, but only partially, in the activities of its own points currency and loyalty program. To tap a hotel loyalty program's potential to be a revenue driver, members must be forced to earn most of their points through revenue stays. That's what Hilton, IHG, Radisson and, once again, Marriott, achieve by making the transferability of points into or out of their programs unfavorable.
The favorable transferability of UR points to WoH points has absolutely nothing to do with WoH points being "worth" more than the rest, as self-anointed "travel gurus" and their sycophants claim. It is simply that the number of points required to afford Hyatt award stays is arbitrarily much lower than for the other programs. The downside of that favorable transferability is what I just described above.The problem for Hyatt, as it was for SPG or Marriott, is that there is no upside to having bank points earned elsewhere enter or leave its loyalty program's ecosystem. The only thing saving Hyatt from a fate similar to Starwood's is that bank points transferred to WoH points are used by members to book award stays at Hyatt hotels instead of being transferred to airline miles, and that is because, unlike "aspirational" Starwood awards which were exorbitantly priced, Hyatt awards are much more affordable. In addition, the transfer of WoH points to airline miles is not as favorable as was the transfer of starpoints to miles.
Now, maybe it's clear why Marriott has finally further devalued the transfer of its points currency to airline miles, which it had put on hold to "appease" rabid SPG loyalists...
Most devaluation hotel program with worst benefits.
I never book with them. Even I have a silver elite status for my work (that doesn't give much anyway)
I dunno - I'd rather spend 120K points on a luxury hotel than get 50K in airline miles, when you porbably need another 100K to get the flight and time you want. I've found much more reason to redeem Marriott points for hotels than to transfer.
That's the point.
Marriott's gutting of SPG-style points-to-miles transfers, initiated right after the merger with a 33% devaluation, has now been completed.
On August 3, 2018, 1:25 am, I presciently wrote the following in this space:
Marriott's gutting of SPG-style points-to-miles transfers, initiated right after the merger with a 33% devaluation, has now been completed.
On August 3, 2018, 1:25 am, I presciently wrote the following in this space:
Like I said more than 3 years ago, from the git-go Marriott did not care much for SPG's points-to-miles transfer scheme. It's now decided to end it once and for all...
Time to burn, baby, burn my remaining Bonvoy points.
The now ridiculously overpriced and devalued Brilliant card is already gone at the next renewal.
Even IHG has a more rewarding points program now. They will eventually come to regret what they have done to kill brand 'loyalty'.
To Tom's point, Marriott is at record profits. It is clear that the membership's pissing and moaning does not move the needle. Next year, when awards go fully dynamic, grab your ankles. Then, when award inventory disappears, that's when you realize they won't be using K-Y. Yet, some will still be shooting for Platinum.
Doesn't surprise me. Bonvoy points are fairly worthless imo. Takes so many points to get luxury nights at properties. Glad I transferred all of my points to Alaska a few months ago.
Sorry I think this deserves its own post. This is sick.
The favorable transferability of BONVoY points to miles, which Marriott Rewards did not have, was instituted to try to appease former SPG loyalists after the merger. Economically, the favorable transferability is bone-headed because there is nothing in it for Marriott and its ideas people knew it all along. The gutting of the transfers was going to happen; it was simply put on hold for "appeasement", which is no longer the program's strategy.
Add Korean Air to this list now -- just got an email over the weekend about that.
God I miss Starwood.
LOL. If Starwood was so great why did it go belly-up? Reverse of Darwinism or "the demise of the fittest"? Hardly. It was a flawed program, with the favorable transferablity of starpoints to miles being one of the biggest flaws that quite likely contributed to Starwood's demise.
Nice job at taking a throwaway nostalgic comment and spending waaaay too much time contemplating it.
One might suggest a nice hobby for you.
Misguided nostalgia because the reality was not at all what the "God I miss Starwood" suggested...
By 'go belly-up' you mean 'got bought out by Marriott for $13 billion'?
I wish I could go belly-up like that.
It could have fetched a lot more if it had been profitable instead of on the brink of collapse when it went on the auction ...that type of 'belly-up.'
"Starwood Hotels CEO Frits van Paasschen resigns" (Reuters, February 17, 2015)
"Starwood Hotels CEO Frits van Paasschen resigns" (Reuters, February 17, 2015)
Q.E.D
Puzzled by why LifeMiles is included - It constantly sells at price way lower than Bonvoy price, easily acquired by tons methods, plus no way the program sells miles at a high bulk price.
If the advantages keep being taking away and why doesn't Marriott just shut down the loyalty program? It looks like the Marriott points are like trash now.
Reason #4 - they are beginning to pull up the bridge on cash out options ahead of gutting the program next year. I expect this to spread to other airlines also
Unfortunate, but frankly I am surprised many of these transfers lasted as long as they did post merger.
1) American wants you to earn AA miles via their card/partners
2) Delta wants you to transact with Amex
3) Avianca must be United related
I have gotten good value out of Marriott with simple earn and burn on hotels, no real need to explore the transfers
@Anthony, I don't agree with your #3 but your final sentence is a revelation IMO. They want us burning points on hotel stays. So they strictly limit mileage transfer costs. the bean counters have moved in.
@Anthony
If you read between the lines, it the exact opposite.
1) United doesn't want you to redeem AA miles.
2) United doesn't want you to redeem DL miles.
3) United doesn't want you to redeem AV miles.
If you devalue those 3, guess what becomes more valuable to North American members.
United? Wrong.
Next on the chopping board will likely be,
AC and TK.
There goes the last reason for even considering Bonvoy points, it was a reasonable route to acquire AA miles when Marriott had a 50% off sale on points like last week. The stinking 20% devaluation on AA transfers puts paid to that scheme. Bonvoyed again!
This is a prime example of why the transfers were devalued
It wouldn't surprise me to see Marriott unveil something with United but if that was happening then you think this devaluation would apply to other airlines.
Seems like United is having some influence over this change.
That being said, Bonvoy already was devalued when they stopped the Hotel + Air package.
If there's one thing I've learned, it's that the floor can always fall further with Marriott.
You said it! Bonvoyed again!