Simple Guide: The Value Of Hotel Points

When one hotel chain says there’s a 2,000 point bonus per stay, it doesn’t mean much, but when another does, it’s almost worth going out of your way to lock in. Why?

Hotel points from each loyalty program can be worth vastly different amounts, with some bordering on useless and others being extremely useful, no matter what they try to tell you!

If you’re not sure which hotel loyalty program to go with, or earn points from, don’t fret, this simple guide explains the differences between the various hotel points and how to come up with a simple metric to gain maximum value from your points.

2,000 hotel points with one chain can be vastly more valuable than 2,000 with another, and even 90,000 points with one leading hotel loyalty program may be less valuable than 30,000 with another, but it’ll all make sense! It sounds crazy, but it’s all relatively simple.

Here’s how to understand and navigate hotel points, for good and for all!

Misconceptions With Hotel Loyalty Points

One of the larger misconceptions with points is that they’re all basically same.

Let’s take a second to break down why you might want to look more closely at the various hotel points offers you see flashed into your loyalty accounts from brands like Hilton, Hyatt, Marriott, IHG and Accor are best to collect.

Basically, hotel points are like money. Not every currency starts at the same value, just like a 1 Thai Baht isn’t worth the same as 1 US Dollar.

Here’s a perfect example to start: Hyatt recently offered 3,000 bonus points per stay at select hotels, while Hilton offered 2,000. These may sound like similar amounts, but they’re not at all.

Based on our valuations, one Hyatt point is at least 3X more valuable than one Hilton Honors Point, and therefore the Hyatt promotion is even more valuable on the surface than the minor points difference would suggest.

In fact, even if it was Hilton offering 3,000 and Hyatt offering the 2,000 Points, Hyatt would still be the more valuable promotion, by a long shot!

That doesn’t mean one loyalty program is better than another. It just means they do things different when it comes to points. Just like countries do money differently. A lot doesn’t always mean a lot.

Why are Hyatt Points worth more than Hilton Points, on a per point basis you say? Because the highest end Hyatt hotels you can book top out at 40,000 points per night at a maximum. Most five star hotels are around 25,000 points per night.

Almost all the standard five star hotels you’d want to experience, like the Park Hyatt Tokyo, or Andaz New York will be just 30,000 World of Hyatt Points or fewer. 10 stays with 3,000 bonus points, would give you enough for one “free” night, maybe even with a few left over.

Hilton on the other hand, tops out at an astronomical 95,000-120,000 points per night, and at 2,000 points per stay, you’d need 46 nights or more to earn the points needed by the bonus alone.

Hilton has other great ways to earn points, like credit cards which offer over 150,000 points as a welcome bonus, but it’s a great illustration of the basic differences and why it’s important to understand that no two points programs are exactly alike.

Just like $1 isn’t the same as £1, one point with one chain doesn’t start out with the same value as others.

Is it the same with other hotel chains, like IHG, Marriott, Accor and others? You bet! Here’s a little breakdown of how each program’s points are valued…

If the way you earn free nights, points and perks is from hotel stays rather than credit card spending, all the loyalty programs are actually really close in the rebate you get as a reward.

In our example above, Hyatt Points may be more valuable than Hilton Points, but Hilton gives 10X points per dollar spent at hotels, while Hyatt only gives 5 per dollar. This kinda evens things out, and that’s why the values are all pretty close.

If you have the time, I highly suggest reading this comparative guide which explains that much further.

Making Your Hotel Point Calculations

Now, onto calculating the respective values of each points program.

This is how you figure out what kind of value you should get for your points with each program, and helps to explain why fewer points from one, can be more valuable than more points from another.

For simplicity sake, you can work with the assumption that your points from various hotel programs are worth…

• Marriott Bonvoy Points are worth around 0.6 cents per point.
• IHG Rewards Club Points are worth around 0.5 cents per point.
• Hilton Honors Points are worth around 0.4 cents per point.
• World Of Hyatt Points are worth around 1.5 cents per point.
• Radisson Rewards are worth around 0.4 cents per point.

These points valuations may be off by 0.1 or similar margins in some instances, but that all depends how you use the points, and see the trajectory of loyalty programs. Don’t worry about it. Just use the figures as a baseline of value, and try to do better with your stash of points.

Think: 100,000 points at .5 cents per point should be worth $500.

Knowing the minimum value you should be deriving from your points in each loyalty currency can help you to understand better what things like credit card bonuses are actually worth, rather than just whether they sound “big” or not.

If a hotel bonus offer is worth going out of your way for, we’ll always give it a big shout in our credit card news section!

How To Calculate Value Of Hotel Points

If you’re unsure how to make sense of those calculations, let’s use the 150,000 point, or three free night Marriott Point Bonvoy Boundless Credit Card bonus as a guide.

To understand the minimum value you’d hope to extract from that bonus, you’d multiply the number of points by the point valuation they offer above, like (150,000 x 0.006), for a total of 600, which you can then stick a dollar ($) sign in front of.

For that bonus, you’d hope to extract at least $900 worth of hotel nights, upgrades, or other ways of using Marriott Bonvoy Points. How to figure that out? Check the price of the same night you hope to book using points, as if you’re going to use cash. If the paid cash rates add up to more than the value you tallied up your points, then you’re doing it right.

Back to the comparative value of different programs, It’s why something like a 60,000 point World Of Hyatt Credit Card offer might not sound nearly as exciting on the face, compared to 150,000 from Hilton, Marriott, IHG or others, but at (60,000 x 0.015 value, you’d expect $900 of value, which is a near identical return for signing up.

Hopefully, this will give you a clearer understanding of just “how good” or how “underwhelming” an offer might be, and explain why 60,000 points from one brand is as good as 150,000 from another – or better!

If you have the time, it’s really worth diving deeper into the rebates each hotel group brings on actual stays, since it can really paint a clearer picture of what you should be focusing on. The more you know!