On Wednesday of this week, Hilton introduced a new pricing scheme along with a few other changes to their loyalty program.
This is the old Hilton chart that will no longer, technically, apply.
Rooms now have variable rates that will fluctuate with supply/demand and the price of the room. Hilton has promised though that the point price of a room won’t rise higher than what its category was priced on this old chart.
Seems pretty similar to what was already happening considering the variance in price of many hotel categories. The primary differences are:
A) Some rooms will be cheaper in off season.
B) Perhaps some rooms will be more expensive in that they consistently price at the top of their range instead of a previously lower price.
C) The award chart is no longer published online. I don’t particularly like the lack of transparency, but with the variance on the old chart, they weren’t glued to super specific award prices on the majority of hotels before either so there’s not much of a difference.
Hotels that were categorized as a 1, 2, or 3 before cannot get any more expensive than they already were as prices didn’t vary in those categories. A Category 1 is 5k points, category 2 is 10k points, and category 3 is 20k points. If anything, we might see those hotels get even cheaper.
The rest of the hotels are a toss up. They could end up priced on the higher end of their range or lower, depending on the cash price.
Strategies for Maximizing Hilton Program
Due to the bifurcated nature of the old Hilton chart (extreme ends with cheap low category hotels and crazy expensive top category hotels), our strategy with the Hilton program has always revolved around three key concepts:
- Spend your points from cards like the Citi® Hilton HHonors™ Visa Signature® Card or the Hilton Surpass Card from American Express on Category 1 – 3 hotels to stretch your points
- Spend your Free Night Certificates from the Citi® Hilton HHonors™ Reserve Card on Category 9 and 10 hotels that are extremely pricey
- Forsake the middle of the chart
I don’t think the new pricing scheme affects that strategy much, as the hotels in Categories 1 through 3 will remain the same price, and no matter what happens to the price of the higher end hotels, your Free Night Certificate should cover it.
If you want to see the award price of a room before the changes to compare it to the price of one now, Hilton has a calculator that allows you to see the old price/price range easily.
Points & Money Awards
The biggest change to the Hilton program, in my opinion, is the ability you now have to pay for any award room partially with points and partially with cash if you so choose (except for Hampton Inns in mainland China for the time being). Before, Points & Money awards where capacity controlled and allowed you to book a room only if you had 40% of the necessary points plus a cash co-pay.
I see this as a positive change, as availability for Points & Money Awards could be quite difficult to find in the past. Now you can choose to offset the cost of any stay with your Hilton points.
Whether or not a Points & Money Award is a good deal is going to depend on each specific case, as the amount of cash owed vs. points on the sliding scale will vary depending on the cash price of the room. I think about Point & Money Awards like I am booking a free room and then simultaneously being offered the chance to buy back some of my Hilton points. If the price I’m buying the Hilton points back at is less than what I value them (.4 cents each), then it could be considered a good deal.
The minimum amount of points you can use towards a Points & Money Award is 5,000, and the sliding scale climbs in 1k increments. Points & Money stays will count toward elite status, but you only earn base points on the cash portion paid.
I can’t show you my own example as I have no Hilton points in my Honors account at the moment, so instead look at One Mile at a Time‘s screenshots using the Points & Money Award sliding scale, which I’ll reference below.
It costs either costs either 95,000 points or $883.80 to book a standard room at the Conrad Maldives. Or, you could redeem 10,000 points and pay $720, which would be like “buying back” your Hilton points for 1.63 cents each. Since I value Hilton points at .4 cents, this would be a terrible deal.
Sliding the scale towards paying more points and less cash, you could pay 85,000 points and $90 cash. That’s like “buying back” 10,000 Hilton points (since the full award price is 95,000) for .9 cents. Still not a good deal.
It costs either 20,000 points or $136 to book a standard room at the DoubleTree Jakarta. Or, you could redeem 10,000 points and pay $62 with a Points & Money Award, which is like “buying back” your Hilton points for .62 cents each. As I value Hilton points at .4 cents each, I don’t see this a super great deal, but if I needed 10k points for another redemption soon, perhaps I might do it.
Side Perks of Points & Money Awards
Commenter Luis on One Mile at a Time‘s post covering the Hilton changes pointed out the following perks of Points & Money Awards that, while I assume not intentional on Hilton’s part, could result in significant of savings for the customer:
- Points & Money Awards might also lower the tax on a booking, which could be very advantageous in areas with high hotel taxes like Bali (as in a savings of around 25%).
- Points & Money Awards appear to eliminate the resort charges, even if you only redeem 5k the minimum amount required.
As I already mentioned, I can’t personally play around with the Points & Money Awards slider to check it out for myself, but if anyone else has and can comment on Luis’ input, that would be appreciated.
Other Changes to the Hilton Honors Program
- It is now called Hilton Honors, not Hilton HHonors
- You can pool your points with up to 10 other Hilton Honors members for no extra cost (awesome!)
- You can extend Diamond status once for free as long as have you have at least 250 lifetime elite qualifying nights or 500k base points AND you’ve earned Diamond status for at least three years already (great, but probably won’t apply to many people)
- You can redeem points for purchases on Amazon (meh, it’s bound to be a bad value)
How to Get a Ton of Hilton Points Quickly
The Citi® Hilton HHonors™ Visa Signature® Card is offering 75,000 bonus HHonors points after spending $2,000 on the card in the first three months. The card has no annual fee ever.
After meeting the minimum spending requirement, you’ll have at least 79,000 Hilton points (more if you use the card’s category bonuses discussed below.) For reference, eighty thousand points were enough for 20 free nights in a Hilton Category 1 hotel, 10 free nights in Category 2 Hiltons, or 5 free nights in Category 3 Hiltons on the old award chart.
Or if you’d rather earn the Free Weekend Night Certificates to spend at top tier Hiltons, go for the Citi® Hilton HHonors™ Reserve Card. You’ll get two certificates valid for two Free Weekend Nights after spending $2,500 on the card in four months.
Credit card links have been removed from posts and added to the menu bar at the top of every page of MileValue under the heading Top Travel Credit Cards.
Hilton’s loyalty program, newly renamed Hilton Honors, introduced some changes on Wednesday. In my opinion the biggest change is the ability to apply points to offset the cash price of pretty much any award booking. Hilton is also taking away its published award chart and introducing a new revenue-based pricing scheme, but if you already follow our strategies for maximizing the Hilton program, you shouldn’t be affected much. The program was already on its way to becoming revenue-based with the variance in price ranges for categories on its old award chart. Now they’re just saying publicly that Hilton Honors pricing is, in fact, revenue-based.
Other changes include the abillity to pool points for free, redeem points on Amazon, and extend the life of your Diamond elite status for a fourth year if you meet certain requirements.
Reservations made before the launch of these changes Wednesday will maintain the same price as when you booked. If you try to change the reservation, however, it will be subject to the new pricing scheme.