5 Reasons Why the New Marriott Award Chart is Bad for Some Travelers

The new Marriott award chart rates were finally released in full, and it set off a wave of discussions across the award travel world. As with any integration of two separate loyalty programs, both with a large cadre of loyal members, there were bound to be people on both sides of the opinion spectrum.

Many are happy with the overall chart (especially those looking to redeem points at high-end luxury resorts), but today I want to focus on the others and go through my reasons why the new Marriott redemption rates are bad news for many readers.

Note: I started to get into some of these in my number-crunching post, so if you haven't already, feel free to download my Excel spreadsheet to see the numbers for yourself. Remember too that when referencing legacy SPG properties, I am using the equivalent number of points in the new program when evaluating redemption levels (e.g., a current SPG Category 3 property is 7,000 Starpoints, which equals 21,000 Marriott points).

Here are the ways in which the new Marriott award chart isn't something to celebrate:

1. The new redemption website is potentially misleading.

This is one of those "aha" moments that just hit me. I initially applauded the new site that Marriott launched for seeing the full award rates across the 6,800+ properties in the combined program. It had a search feature and allowed you to quickly compare the old prices with the new.

However, there's one problem: In certain cases, it overstates the current award prices, thus making the new award prices look better.

Here's how it does that:

• SPG Category 1-2 properties: Under the current SPG program, Category 1 and 2 properties have two different award rates for weeknights and weekend nights, with the latter being 3,000 points cheaper. However, the new chart lists the current price at the higher weeknight rate. As a result, these properties as a whole are jumping up very significantly in price (see #3 below).
• All Marriott properties: When it comes to legacy Marriott/Ritz properties, the current award prices don't include PointSaver redemptions, which discount the standard award rates during off-peak times. While this varied significantly by hotel, any property that offered these lower rates even just a handful of dates during the year is being pegged at a higher current price.

Now, it's worth noting that current SPG Category 5-7 properties follow a seasonal pricing model, and the new site uses the lower end of that range for current award prices. This will (at least partially) counteract the two overstated groups of properties above. That being said, I'd be willing to bet that the complete award chart, which I calculated to contain an overall decrease of 977 points per night in 2018 and 755 points per night in 2019, is actually a bit lower.

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2. It's not great for families.

One of the first things I noticed when I crunched the numbers was how much of an impact these changes had on family-friendly properties. As I noted yesterday, the two villa-style brands under the combined umbrella had (by far) the largest overall increases in the nightly price of award stays:

• Marriott Vacation Club: Nearly three-quarters of these properties are going up in price, and the average increase is 7,813 points per night.
• VISTA: Over 60% of these properties will be jumping in price, with an average increase of 7,579 points per night

Based on TPG's most recent valuations, that's equivalent to a nightly rate increase of $70.32 and $68.21, respectively.

Unfortunately, it doesn't stop there. As noted by Mommy Points, three popular Disney resorts (the Swan, the Dolphin and the Sheraton Lake Buena Vista) are all going up in price as well. As a result, you'd definitely want to lock in any of these redemptions before the new rates kick in sometime in August.

3. It disproportionately hurts low-tier properties.

Despite having 70% of properties remaining the same or lowering their award night prices, one end of the spectrum took the brunt of increased prices, both on the legacy Marriott and legacy SPG programs. Thanks to a comment on my number-crunching post (and the aforementioned realization that SPG Category 1 and 2 properties were showing up with an inflated current price), I filtered down to just those hotels from both programs and came to the following (sobering) numbers:

• SPG Category 1: These properties currently require 9,000 points per night during the week and 6,000 points per night on the weekends, which can offer some phenomenal value. Under the new award chart, just under half of the 115 properties (46.96%) are increasing in price, and the average increase is 1,705 points. This represents a 20.94% jump in the nightly cost.
• SPG Category 2: These properties are hit even harder. You can currently book award nights at 12,000/9,000 points per night for weeknights/weekend nights (respectively). However, over 90% of the 218 hotels at this level are increasing in price come August! The average increase across the category is 2,733 points per night, a jump of 24.53%.
• Marriott Category 1: These properties currently require 7,500 points per night, and since the new Category 1 requires the same number of points, none are decreasing in price. However, roughly 8% are raising their prices, resulting in a net increase of 392 points per night (or 5.23%).
• Marriott Category 2: Once again, the pain is significant here, with over 80% of the 623 properties raising their prices. This is an average increase of 1,826 points per night, a jump of 18.26%.

There's definitely still value to be had at these properties, but this is a very significant devaluation for those who've typically redeemed their points at the lower-tier locations.

4. It has a significant negative impact on luxury properties.

Many of you probably like to earn points with your credit cards or for inexpensive stays and then redeem those points at luxury properties. If so, you're in for a rude awakening, as many of the luxury brands are seeing jumps in the overall prices. Here's a quick table that quantifies these increases:

Aside from the St. Regis drop and the minimal drop at Luxury Collection properties, these are all relatively significant increases.

The impact becomes even more pronounced when you evaluate the current top categories across the programs:

These are all quite large jumps, especially the fact that almost 100% of Marriott's current top properties are increasing! When you combine these numbers with the previously noted increases in lower-tier categories, it becomes clear that the bulk of the improvements in the award chart have been distributed to the middle tier locations.

5. It leaves the door wide-open to devaluations.

The final element is the caveat included in the initial announcement post. One of the final (and significant) outstanding items that we don't yet know is how individual properties will determine off-peak, standard and peak dates starting in 2019.

Given the current rates for these three tiers of seasonality, there will be no impact to the effective award rate per night if a hotel blocks the exact same number of days as off-peak and peak; the average rate per night will still be equal to the standard award rate.

However, let's consider the following extreme (but entirely plausible) example for a Category 8 property:

• Peak: 200 days (100,000 points per night)
• Standard: 125 days (85,000)
• Off-peak: 40 (70,000)

With this breakdown, the hotel is technically charging an average rate of 91,575 points per night, a 7.74% premium.

Only time will tell whether this becomes an issue, but unless there are specific safeguards planned, it does allow properties to play games with these dates to appear at a lower category than they actually should.

Bottom Line

There are many conflicting opinions out there on the Marriott and Starwood merger, and the launch of the combined programs' full award chart has only intensified these debates. While there are obviously some travelers who will come out ahead with the new chart, many others may be upset with the changes and are rethinking their loyalty to the yet-to-be-named combined program.

It isn't possible to make everyone happy with this type of integration, but if you fall into the above categories, you are likely quite disappointed with the new award rates.