What is the best hotel scheme? – Starwood Preferred Guest – The Opinion

In my article yesterday, I outlined ‘the facts’ of the Starwood Preferred Guest loyalty scheme. This article is my personal opinion, highlighting areas where I think you might want to focus.

Important:  Marriott bought Starwood Hotels & Resorts in 2016.  From 2018, Marriott Rewards and Starwood Preferred Guest will be merged into a new combined programme.  This article covers the existing Starwood Preferred Guest programme only.

The 10-second summary:

Strong points – excellent top-tier Platinum benefits, unrivalled airline mile conversion rate, good range of aspirational redemption hotels, ‘no blackout dates’ reward availability, many redemption options (upgrades, cash and points, SPG Flights, SPG Moments, SPG Instant Awards)

Weak points – crazy points pricing of high-end properties compared to earning rate

Gritti Palace

The longer version:

Whilst it is now on its last legs, with the merger into ‘Marriott Preferred Guest’ (or whatever it is called) coming ever closer, Starwood Preferred Guest is very well regarded in the loyalty world.

The programme has remained relatively constant for many, many years, giving guests the certainty that the reward they are after will not be pulled away from under them.  You would never see SPG making unannounced changes overnight or adding 75% to its top redemption pricing band as Hilton did in 2013.  The reason was simple – Starwood was a small chain, and people needed to go out of their way to stay with them.  Upset them and they will easily walk way.

If you can manage the 25 stays or 50 nights required to make Platinum – and that isn’t easy, given their thin UK and European city centre portfolio – then the benefits are great.  Do 50 nights and the Suite Night Upgrade awards are very useful. Every stay will see you getting (subject to availability) lounge access, a good upgrade – often a suite, free high-speed internet and, if you choose it, free breakfast.

(If you are getting close to Platinum, remember that you can credit up to three rooms per night.  If you are staying somewhere cheap, it might be worth booking two or three rooms instead of one!)

We don’t know, of course, what the benefits of the new 2018 programme will be.  Don’t start moving stays to Starwood in the hope of getting the benefits above because they might disappear in a puff of smoke.  Marriott Rewards has never given suite upgrades as a benefit, for example.

When you come to redeem, SPG members have access to an unrivalled collection of historic and luxury properties. The Gritti Palace in Venice (photo above) is among them, along with two Maldives resorts and plenty of family-friendly European resorts such as St Regis Mardavall in Majorca and Pine Cliffs in Portugal.  Only Park Hyatt can compete among the chains with loyalty schemes.

If you can’t face another night in a hotel, the list of airline partners is unrivalled, as is the 1 : 1 transfer rate (rising to 1 : 1.25 when you convert 20,000 points). Many people use SPG simply to move American Express Membership Rewards points into non-Amex airline partners, such as American Airlines and Miles & More.

The UK SPG credit card is, frankly, underpowered.   Making you spend £25,000 just to get a free night in a Category 1-4 hotel (such as the Sheraton at Heathrow!) is crazy. The IHG Rewards Club Premium card, for example, gives you a free night anywhere for spending just £10,000 each year.   One improvement in 2017 has been the introduction of double points (2 per £1) for spending at Marriott or SPG hotels.

The major downside, apart from the lack of UK properties outside London, is the redemption pricing for high end hotels.  Category 7 hotels are 30,000 or 35,000 points per night – that requires $10,000 – $12,500 of hotel spend for one free night for a Gold or Platinum member. You would also be sacrificing 35,000 or 40,000 airline miles by redeeming for a free Category 7 night.

You could argue, post the Marriott merger, that there is now no justification for spending Starwood points for high end SPG properties.  In London, for example, there are various SPG hotels which require 20,000 points per night or more.  However, even the most expensive Marriott Rewards property is only 45,000 Marriott points (= 15,000 Starwood points) so why bother?

Mid-tier redemptions are better value.  I have a spreadsheet which shows that I consistently get around 1.5p per SPG point of value from my redemptions at, say, Le Meridien in Hamburg or the Westin in Dublin.  I also value SPG Moments, especially now that they have a box at the 02 Arena.  15,000 SPG points for a pair of tickets is a good deal – Celine Dion, at the behest of my wife, is lined up for June.

What I don’t like is the limited booking functionality of the SPG website.  You can do a lot with your points – upgrade a cash room to a club room, upgrade a cash room to a suite, use 100% points for a club room, suite or just a bigger room – but none of this can be done via the website.  All it offers are ‘plain vanilla’ redemptions into entry level rooms.  Anything else requires you to call SPG.

Overall, SPG offers an impressive package.  I have also been impressed by the SPG employees I have met over the years, who were genuinely working to create a great programme that would drive loyalty to what was a small business.  We can only hope that Marriott preserves the best bits of it.

(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. RussellH says:

    A couple of times I have had to speak to SPG: the request a callback button on the website has always worked more or less instantly for me – ie the phone rang within 5s of my clicking it.

    The person answering ahs always semed knowledgeable, helpful and friendly – a complete contrast to phoning IHG.

    Only weird thing – the CLI displayed on the callback was in Paris, albeit far too many digits.

  2. When you value your points at 1.5p or 1p for Avios, do you take the lowest cash price or do you take it as the cash price at time of booking?

    • You use the price you are happy to pay.

      There are 3 types of valuations: what you paid, what you are willing to pay, and what the service provider is charging.

      Suppose an airline is charging £200 for a certain flight. It is also available to redeem at 4000 avios + £17.50. I recently paid £12 to acquire 4000 avios, i.e. 0.3p each, Tesco lego, or foregoing cashback on credit card spend, or whatever.

      The three ways of looking at this are:

      1. I actually paid £29.50 of my own money for this flight. That’s really cheap!

      2. If I had no avios, then I wouldn’t pay £200, and therefore I wouldn’t take the flight at all. But if the airline was selling it at £100 and I had no avios or wanted to keep them for something else, I would happily pay £100.

      2A) I got something that I would have paid £100 for, but I only spent £29.50! I have saved £70.50 which I can spend on something else.

      2B) I bought avios at 0.3p each and sold them at 2p each, making a profit.

      3. Even though I would never pay £200 for this flight, I am still going to say that I got 4.5p per avios from this redemption in order to boost my ego.

      Compare with the following: I exchanged £100 to $150 US dollars in December 2015, but I didn’t spend it until April 2017. My purchase of $150 still cost me £100, even though it would cost me £120 to buy those dollars today. Did I save £20?

    • Peter K says:

      Rob’s said before it is the lowest price he could reasonably get the flight for (on any airline he would actually fly).

      • Peter K says:

        I personally value them, not just based upon a monetary saving, but also upon what I can achieve with them. I’d never pay £1800+ per person to fly business to Barbados for example but I’m happy to use Avios to do it.

        I work out a saving per avios based upon what I would have to pay for the flights at the time of booking but the VALUE of avios is achieving what you are attempting to get.

      • It should be valued at the lowest of either:
        – the cheapest available price that meets your needs (eg service / flexibility)
        – or the highest cash price you would be willing to pay for the same flight.

        Don’t forget to take into account the points/miles/cashback you would earn on a cash booking.

    • TGLoyalty says:

      Giving them a value also helps with working out if it’s better to use cash or points at the time of booking.

      About valuing based upon what you will pay no point saying I would only pay £1000 for a business flight if the flight is never available for £1000.

      Personally I use what I could purchase a the flight/hotel on similar dates that I would actually be willing to use

    • Interesting to see everyone’s view. I was hoping Rob would be able to shed some light on how he values his points for the purposes of this website. I personally value my points on the cash equivalent price at the time of booking (I don’t bother rechecking to see if they go up or down in cash value).

      If you value your points as the lowest price on any airline for a particular flight it might be more “realistic” for you (as that’s how you search for cash flights) but would also assume parity across airlines. E.g. would you compare business in Qatar with First in BA? And do you add value to a direct flight over a stopover in Doha, Abu Dhabi etc.?

      For many people, collecting Avios and 241s is so that you can fly First where you wouldn’t/couldn’t pay the cash equivalent. If you value it as the cash price you would be willing to pay for a flight then it wouldn’t work because you’d be comparing it to an economy/lower class ticket. E.g. if you only usually fly economy and the fare for a particular flight is £500pp, you could book into first with Avios and a 241. If the taxes then cost £500pp you’re effectively valuing your Avios at 0p.

      • I have to agree with the majority of what you say. The way each of us values a point/mile is very different – and there’s more than 1 factor to take into consideration. And I think, price is not everything. A couple of weeks ago I did a very poor redemption: 34.000 Avios for a discount of 256 EUR, i.e. 0.0075 EUR per Avios for a rtrn flight from BCN to NYC (for 2). In total I paid 590 EUR for 2 pax rtrn + 34.000 Avios, or 295 EUR + 17.000 Avios (in economy). Nevertheless I value the Avios more, because: (1) outbound with AA B777 non-stop to JFK, excellent time, (2) return at 8 pm from NYC with AA via LHR (the London Airways) (great timing I think, the AA direct flight to BCN leaves too early NYC), (3) finally, without the 34.000 Avios I wouldn’t have paid the normal price. That means that thanks to the Avios I used I can make the trip – without them I wouldn’t be able to enjoy the trip. So technically, even though I only get 256 EUR for 34.000 Avios, these Avios tip the balance towards the “I take the trip”, from “I don’t take the trip”.
        Alternatively I could have taken a return flight from DUS to NYC via LON (outbound and return) for only 290 EUR, but on top of that I would have needed a flight BCN to DUS (rtrn) and also bad flying times. However, too much wasted time and not worth it.
        Similarly, I have also used Avios for business class. However, the value I get is beyond the theoretical ticket price, as I would almost certainly never pay a business class ticket. The extra comfort you get (in comparison to Y) is just invaluable.
        In summary, thanks to Avios I can fly: more often and sometimes, with more comfort. Hence, my Avios valuation goes beyond theoretical ticket price.

      • Genghis says:

        I don’t think taking the cash equivalent price at time of booking is useful. Let me explain:
        Assume a business class flight on BA to JFK for 100k avios + £500 and a cash price of £3,500 so using your method you’d be getting 3ppa of value (need to calc avios earned etc but let’s leave that). But most people don’t pick up all their miles for free from flying. So what’s more important is what your purchase point is. Given above scenario, would you be a buyer at 2.5p?

        • Ultimately it depends on what we mainly collect&redeem miles for. As Sam said earlier, many readers here are looking for aspirational premium cabin redemptions in F/J (upgrade or 241). For them, the cash price at any point is almost irrelevant since they would otherwise very unlikely to pay cash for the same ticket.

          On the other hand, there are also some of us who collect Avios primarily for its strength in short-haul redemption in Asia, North America, and RFS in Europe, and would never consider Avios for long-haul premium flights (fly ex-EU with cash or use better programs for this purpose). In this case, the cash price at the time of booking is often directly relevant, which is either the cheapest flight you will otherwise pay&fly (e.g. short-notice/one-way bookings), or the maximum you are willing to pay (e.g. Ryanair/Norwegian for ex-EU positioning), each to their own.

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