My chat with the head of Hilton Honors about their radical changes

Hilton Honors will make a major announcement today about changes to the programme which will take effect this Spring, starting later this month.

I spoke with the head of Hilton Honors last night and we talked through the changes for half an hour.  The devil is in the detail, of course, but on the face of it – at least in the short term – it seems positive.

(First change – the second ‘H’ has gone from what was Hilton HHonors!)

This is the big change – Hilton is introducing a radical version of ‘points and money’ which is unlike anything else we’ve seen.

There are two elements to this and it is easier to explain if I look at them separately.

Hilton_Honors new logo

Firstly, for every standard room redemption, you will be able to pick a combination of cash and points.  This will be driven by the points value and the Hilton HHonors member cash rate.

Let’s assume that a particular hotel is selling for 50,000 points or £200.  You will be able to pick any combination of the two as long as you use at least 5,000 points.  You can pay 50,000 points or £200 or 25,000 points + £100 or 5,000 points + £180 etc.

The key reason for doing this is to allow members with small points balances to get some value from their points.  A key secondary reason, I think, is to drive more direct bookings rather than via Expedia etc, since obviously you can’t use this facility via a third party.  This may turn out to be smart – it is similar to what BA has done with ‘part pay with Avios’.

Here is the second change.

The maximum points price for a room will be no higher than it is today.  However, off peak points prices will fall sharply.  This effectively puts a floor under the value you will get for a Hilton point.

You will remember in our review of the Gran Hotel Montesol yesterday that it was selling for 95,000 points or €600 in August but 95,000 points or €270 in May.  Under the new system, it will remain 95,000 points in August but the May price will fall to, I imagine, something around 50,000 points.  You will then be able to pick your preferred combination of 50,000 points, €270 or something inbetween.

So far, so good.  I honestly cannot see any downside in the short term.

The risk is in the long term.  Hilton is scrapping redemption categories entirely.  Whilst Gran Hotel Montesol will have a maximum price of 95,000 points this year, there is no reason why it cannot quietly drift out to 120,000 or 150,000 points next year.  Without any category caps to act as a constraint, it could easily happen and before you know it you have a purely revenue based redemption system on your hands.

I doubt Hilton would do this, because I think it understands the value of offering ‘outsized’ redemptions at various hotels (such as Montesol in August), but the risk is there.

There are other changes coming too:

free points pooling amongst friends and family

the option for selected Diamond members to pause their membership for a year for any reason, possibly during a period of redundancy, changed travel patterns, maternity leave etc

for US members, the option to redeem points for merchandise from amazon.com

These changes are further down the line.  The move to ‘points and money’ redemptions will take place first, in late February.

For probably the first time ever following a scheme change, I am not encouraging members to burn their points quickly!

The only thing that gets worse is that the current ‘points and money’ redemptions – which were not often available – are being scrapped and replaced with the new system.  If you were looking at a ‘points and money’ reward then I would make sure you book that over the next 3 weeks or so.

The rest of us can wait to see how the new model unfolds.  An off-peak example I was shown gave a value per point of 0.5p – if that is really where it ends up, and remembering that you would be able to get that value on any standard room on any night – then the scheme will be much improved.

I will write more on this in the coming days when I have seen the official details.

(Want to earn more hotel points?  Click here to see our complete list of promotions from the major hotel chains or use the ‘Hotel Promos’ link in the menu bar at the top of the page.)

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Comments

  1. I’m going to pop this in here as an OT and hope it can benefit someone. Marriott have opened a new JW in Phu Quoc, Vietnam. Looks absolutely stunning. It’s a Cat 5 however it is pricing at 15K points per night. Click through from the main search page. Anyone looking for some R&R may well want to consider. Link to hotel is here http://www.marriott.co.uk/hotels/travel/pqcjw-jw-marriott-phu-quoc-emerald-bay-resort-and-spa/

    • Genghis says:

      Looks nice. Mrs G and I went to Phu Quoc at the end of our honeymoon a few years ago. Great island.

    • Really interested in this but couldn’t see a single day available on points on the calendar.

      Did you actually see availability there somehow?

  2. James67 says:
  3. Do you see a need to rush to make a Conrad Maldives booking or should we be ok for some time yet?
    Thank you!

  4. barnaby100 says:

    I must have overlooked what makes this radical. Read it on flyer talk earlier and my 1st thought was so what?

    • What’s radical is that there should never be a situation where you decide against using points because the cash rate is too low and/or the points price too high. You will have the option to use points – for a standard room – at a level which we will hopefully consider useful.

  5. Peter K says:

    I personally think this’ll make the higher end hotels more aspirational. Rather than taking ages to get the 60/70/80k points for a night for a top hotel, you could spend a third as long and bring the price down to a level you wouldn’t mind paying.

  6. Slightly O/T but if you currently have Diamond status, due to the status match offer Hilton are currently running, if you write them a nice email they are willing to extend your diamond status to MArch 2018 – in line with the matching offer. At least they did for me :). Might be extra handy for when they let you “pause” your diamond status…

  7. Is there a risk that some of the 5,000 / 10,000 points hotels will drift up and we will loose the 5 redemption nights for the price of 4 for silver?

    Did I read this right, in that this will massively boost redemption availability as if the room is available you will always be able to use some of your points to discount the price..

    • Availability remains the same (ie you can always redeem if a standard room is available) but your LIKELIHOOD of redeeming is higher because – on days when cash rates are low – the points price will be low too.

  8. Question regarding Hilton Honors, I’m doing a status match at present – is a stay of 2 or more nights counted as “1 stay” for status qualification purposes?