Maximize Monday: Online Travel Agency (OTA) Loyalty Programs
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In light of the launch last week of Orbitz’s new loyalty program, Orbitz Rewards, I wanted to take a look at the loyalty programs of the major OTA’s (online travel agencies) out there – Expedia, Hotels.com, Orbitz and Travelocity – and how you can maximize your points and rewards through them.
Expedia launched its Expedia Rewards program back in 2011 and has been adding features and benefits to it ever since. Here are the basics on the program.
Earning and Redeeming
When booking through Expedia, members earn 2 points per $1 on hotel bookings and packages, and a mere 1 point per $5 on flights. Points are redeemable at 1 cent apiece when it comes time to book.
Your Expedia points will not expire as long as you book and complete qualifying travel on Expedia.com or redeem Expedia points for a travel reward at least once every 18 months. Qualifying travel includes any travel items that are eligible for earning Expedia points.
On the redemption side, it’s a bit trickier. Members can redeem their points for coupons at certain values to use towards travel purchases. Redeeming points for flights gets you a value of just about 0.7-1 cent per point – so if all you buy on Expedia are flights, then you’re earning back 0.2% of your spending at best. Pretty terrible. To redeem for flights, you must have enough available Expedia points to cover the full cost of the airline ticket you’re booking. You cannot combine points with cash for flights and you’ll see the amount of points necessary at time of booking.
You can also redeem your points for coupons towards hotel bookings in various increments. You can start redeeming at 3,500 points for a $25 coupon and up to 140,000 points for a $1,000 coupon. Point redemptions toward hotel coupons are at a fixed rate of 0.7 cents per point so if most of your spending and redeeming is on hotels and packages, you’re earning 1.4% back. Again not great.
You redeem your available Expedia points for hotel coupons and then put them toward the cost of your hotel. You must redeem available Expedia points for a Rewards Coupon prior to shopping so that your Rewards Coupon code is available when you’re ready to book. For hotels, your hotel Rewards Coupon will cover the coupon value, and you pay the remainder with your credit card.
Expedia Elite Plus status is available to Expedia Rewards members who book and complete at least $10,000 worth of travel, or book and stay at least fifteen (15) hotel nights within a calendar year. Once upgraded to Elite Plus, your status is valid for the remainder of the calendar year in which you qualified, the next full calendar year, and through February 28 of the following year.
Members with Elite Plus status earn a 25% bonus on Expedia points every time they book an eligible hotel or vacation package, get free upgrades based on availability at over 1,400 VIP Access hotels, flexible check-in and check-out times, priority customer care, exclusive offers and promotions and dedicated concierge service.
Expedia recently launched a new Business Rewards program exclusively for Chase Ink customers. The new program is designed for small businesses and includes several travel management tools and rewards geared toward their needs.
The main reward is that companies can earn $100 in credit for every 10 hotel nights booked through the program, and that employees can still individually participate in the Expedia Rewards program and earn their own rewards. To enroll, you or your company just need to have one of the Chase Ink cards such as the Ink Bold, the Ink Plus, the Ink Classic, or the Ink Cash. Though this project is a joint venture from Expedia and Ink from Chase, you can use any method of payment accepted on Expedia.com to book the travel and you will still earn rewards for eligible travel. However, to be eligible to enroll, you must go to the Expedia Business Rewards site via the Ink Insider page at InkFromChase.com.
When you sign up for the program on Expedia using an Expedia.com account and enroll your employees under your account by linking their Expedia accounts to the company’s business rewards one, your company will start accruing “reward nights” on stays booked on Expedia. The employees will book travel on the site using their own accounts, earning their own frequent flyer miles and Expedia Rewards points, and the bookings will show up automatically in the company account.
In order to earn these reward nights, the travel booked must include pre-paid hotel nights though it can also be part of packages that include other components like air and car. When the company racks up 10 reward nights, it is given a coupon for $100 to spend on future pre-paid hotel stays – not airfare or cash back. These “Flexible Reward Coupons” can be used on future business trips or even just transferred to any employee or friend with Expedia accounts as gifts – they don’t have to work for the company. Reward nights expire 18 months after they’re earned and the $100 coupons expire 12 months after they are created by the reward night conversion. One downside: coupons cannot be combined – you can only use one of them at a time for each trip you book, so basically you’re just getting $100 off each itinerary.
Hotels.com’s loyalty program is called Welcome Rewards.
The basic premise is that for every 10 nights you book through Hotels.com you earn one night free, which is a 10% “rebate”. This award is available on over 65,000 hotels worldwide with no date restrictions. According to the Welcome Rewards site, You will receive one (1) loyalty credit for each qualifying night’s stay. Subject to the exclusions below, bookings made at any eligible property qualify for the Welcome Rewards Program.
While it seems that you get a free night at any hotel after 10 nights, that in fact is not the case. The value of the free night will be based on the ten (10) non-expired loyalty credits associated with the reward night. The maximum value of the free night will be equal to the average daily rate, excluding taxes and fees, of the ten (10) night stays for which the credits were earned. So if you stay 9 nights in ultra-budget hotels for rates around $80 a night, and one in a moderately priced hotel around $150, the most you’ll just be able to redeem for would be an $87 hotel room. You are responsible for paying for taxes, fees, meals, incidentals and any other costs associated with the booking or stay. If you use the free night for a night’s stay that costs more than the maximum value of the free night, you must pay the difference – so at least you can get a discount based on your 10 nights if you do want to redeem for a higher-priced room.
Hotels.com also offers two tiers of elite status.
You earn Silver status by booking 10 nights within a calendar year, and benefits include priority customer service, a hassle-free guarantee which doesn’t amount to much except an intention to reduce change or cancellation fees if possible, and early access to deals and promotions.
Gold status requires booking 30 nights within a membership year and benefits include exclusive Gold status deals and a dedicated customer service line.
It’s nice that Hotels.com offers a little something, but benefits are far from impressive since there doesn’t appear to be any tangible benefits of status, beyond enhanced customer service.
Orbitz finally launch a loyalty program, Orbitz Rewards, last week. Here are the details.
Customers earn “Orbucks” based on what kind of travel they purchase:
Flights: You will earn up to 1% of the cost, excluding taxes and fees up to $5,000 ($50 in Orbucks) annually per member. You will only earn Orbucks on the amount paid.
Hotels: You will earn a up to 5% (3% for computer bookings, 5% for app bookings) of the amount paid to Orbitz for your eligible hotel booking, excluding taxes and fees. You will not earn Orbucks on any charges collected directly by the hotel, i.e., Resort fees, room service.
Eligible Packages: You will earn a 1% of the cost of Your Package booking, collected by Orbitz for your entire package booking. You can earn for the price difference due to an exchange. For example: member adds a room night to the reservation, so they earn an additional amount in Orbucks. You will not earn for any fees associated with a post-purchase update to the itinerary (change, cancel, etc.). Also, you will not earn Orbucks on any additional charges collected by the hotel i.e., Resort fees, room service. You will earn a percentage of the cost of Your Hotel booking.
Orbucks can then be redeemed for hotel bookings made through Orbitz but not flights. You can use them towards eligible hotel bookings subsequent to the booking for which the Orbucks are earned. Eligible hotels are designated by an Orbucks “earn” amount with the “O” symbol.
When booking, You will have the option to use all your Orbucks to pay for part or all of the booking (if Your Orbucks balance is greater than amount due). If You choose to use your Orbucks, the amount of the Orbucks you are redeeming will be subtracted from the total amount due for the booking. If you choose not to use Your Orbucks, they will remain in your account for future use.
Orbitz is also introducing an elite status aspect of the program with the following tiers:
-Star Members: Book 4 hotel room nights
-SuperStar: Book 12 hotel room nights
Benefits include a special VIP line to handle travel needs, concierge service, help booking events and entertainment while traveling.
SuperStar members will have access to an exclusive concierge service to help with not only travel needs but also to arrange restaurant reservations, scheduling meeting spaces and activities such as golf tee times and other benefits.
A collection of exclusive hotels badged “All-Star” will also offer added benefits such as free upgrades, WiFi, complimentary breakfast and other perks.
Travelocity’s Rewards program is actually linked to the co-branded Travelocity American Express from US Bank so in order to participate in it, you’ve got to have the credit card.
Here are the current terms:
- Earn 5,000 bonus points after your first purchase
- Earn an additional 5,000 bonus points after spending $1,000 on purchases within the first 90 days of account opening
- Earn 3 points per $1 spent on eligible Travelocity purchases
- Earn 1 point per $1 spent on all other purchases
- Points can be redeemed for statement credits towards Travelocity purchases for Flights, Hotels and Vacation Packages
- No blackout dates or restrictions
- No Annual Fee
So the potential total sign-up bonus is 10,000 points if you spend $1,000 within the first 90 days. Normally, Travelocity points are worth about 1 cent apiece when you redeem them towards statement credits for purchases on Travelocity, so 5,000 points = $50, 10,000 points = $100, etc.
However, when you redeem 20,000 points the value propositions doubles, to a credit of $400 on purchases of airline tickets or Flight + Hotel packages, meaning each point is potentially worth up to 2 cents, and your return on Travelocity spending is up to 6% (3 points per $1 at 2 cents apiece), which is pretty great. Like many other fixed-value points programs, there are no blackout dates, and what’s also great about these points in particular is that you can redeem them towards purchases of airfare, hotel, flight-hotel packages or car rentals that are available on Travelocity.
The downside is you have to have the credit card to earn these points, but the upside is that if you do, you can actually get a pretty good return on your spending.
While I wouldn’t exactly throw a parade for any of these points programs and their earning/redeeming potential, you’ve got to keep in mind that you can compound your earnings with shopping and travel portal bonuses.
If you have the Sapphire Preferred, Ink Bold or Ink Plus cards from Chase you can earn multiple Ultimate Rewards points per $1 when you first log into the Ultimate Rewards travel portal and click through to the OTA of your choice. Currently, the portal is offering the following bonuses on these four OTA’s:
Then let’s say you used the Sapphire Preferred, which earns you 2.14X points per $1 on travel, including that booked through these sites, that I value at 2 cents per point and you’re looking at a return of 7.4% with Expedia at best, 11% with Orbitz at best, 14% with Travelocity and a whopping 24% with Hotels.com while the 5X points bonus lasts. Not bad at all!
The downside is that if you do this, you won’t be earning a purchase bonus by using a particular co-branded credit card to buy tickets on that airline or rooms at a hotel, but I’d take 5X Ultimate Rewards points over 2X miles any day.
It’s not just Chase, either. American Express Travel offers an additional Membership Rewards point for all flights booked through them. There is sometimes a small fee of about $5 tacked onto flights you book through Amex travel, but sometimes the extra Membership Rewards point per dollar spent will be more valuable than the fee paid. If you use the Premier Rewards Gold Card from American Express or Business Rewards Gold cards to purchase airfare, you earn a base of 3X points per $1 on flights booked directly with airlines, so the additional Amex Travel point brings the total points per dollar for airfare to 4X, another great value. If you have one of Amex’s other Membership Rewards-earning cards like the personal or business Platinum cards, you will still be earning 2X points per $1.
For more information on maximizing your travel purchases, check out these three posts: