6 ways to maximize hotel rewards
By Cathleen McCarthy | Published: April 27, 2009
Hotel reward points can help you get more vacation for your money this year, especially if you take advantage of loyalty program incentives and partnerships between card companies, hotels, airlines and retailers.
A few tips for stretching those travel rewards:
- Choose a credit card with hotel rewards that suit your needs.
- Don't spread loyalty too thin.
- Accrue rewards in a currency that works for you.
- Beware of blackout policies.
- Take advantage of the new mobility.
- Use reward points when you need them most -- like now.
1. Choose a credit card with hotel rewards that suit your needs
Comparing hotel rewards can be baffling. Every chain has different rules and ratios for earning and spending points with their credit cards. Do you earn 3 points or 10 points per dollar, and for which hotels? Are the points accrued on entire stays or by the night?
"It gets confusing," says Laurie Goldstein, spokeswoman for Marriott. "My best advice is to choose a program according to where you travel and your preference in hotels. If you travel to a lot of different areas, you might pick Marriott. If you're just traveling to major cities, you might find another program you like better."
Figure out where you are likely to use your rewards, not which chain offers the most options. Hilton, Marriott and InterContinental, for example, have thousands of hotels around the world. "You're not going to use your rewards at 3,000 hotels next year. You'll probably use them at two," says Adam Burke, senior vice president of Hilton HHonors.
Compare properties in those markets. "For example, I go to Chicago to visit my folks and vacation with my wife in Hawaii every year," says Burke. "I would look at hotels in those two places. Decide where you want to travel, then look at how much you have to spend to earn a free stay and how easily can you redeem those points for the reward."
|One road warrior's story|
Consider Karen Fawcett, a self-described "road warrior." Owner of Paris New Media and BonjourParis.com, Fawcett spends 50 nights a year in hotels around the world. On and off the road, Fawcett pays for everything on two American Express Business Platinum cards; one accrues rewards for United Airlines, one for Starwood Hotels. The hefty $400 annual fee on her Starwood Premium card pays for itself, she says, in two-for-one international airline tickets. It also gives her gold level status at check-in.
After trying the Hilton and Marriott loyalty programs, Fawcett settled on Starwood, even though it has only 850 properties worldwide vs. Hilton and Marriott's thousands. Fawcett travels mainly to European, Asian and American cities where Starwood is strong, and she likes their hotels, particularly Le Méridien, W and Sheraton Four Points. "When I'm ready to splurge," she adds, "there's nothing wrong with the St. Regis."
Her Starwood credit card awards a point for every $2 spent, 5,000 bonus points each for the first purchase, every $10,000 charged and the first reservation at a Starwood property. In most areas, 25,000 points buys a free night in a midrange hotel. Fawcett recently stayed at the "strange and wonderful" Le Méridien Cyberport in Hong Kong on reward points, then she redeemed three nights at the St. Regis on a layover in Singapore, thereby scoring a free night at the Sheraton Four Points in Dubai (using SPG's "Buy 3 Nights, Get the 4th Free" deal). She still had 180,000 reward points left when she returned.
"That's nothing," Fawcett says.
2. Don't spread your loyalty too thin
Marriott took top honors in 2008 at the Freddie Awards, the Oscars of the travel industry, for best hotel loyalty program in the Americas and best hotel and air rewards package. But the 600,000-plus frequent travelers who judged the competition preferred Starwood's credit card. SPG American Express was voted best affinity credit card for the second year in a row. Starwood was also named best loyalty program worldwide.
Goldstein admits Marriott's rewards program is similar in practice to those of Starwood, Hilton and InterContinental. "To be honest, most hotel loyalty programs are pretty comparable now," says Goldstein. "Just pick one and stick with it. You'll get more out of it than if you bounce around."
Unfortunately, business travelers can't always choose where they stay. Environmental auditor Michael Wardell prefers the Marriott in one of his regular destinations, but he often finds himself at a Holiday Inn, part of the InterContinental Hotel Group (IHG). He earns rewards for both.
If he chose to, Wardell could use his IHG points to stay at a Marriott via the "Any Hotel Anywhere" program, introduced in 2005, which allows IHG Priority Club members to redeem points earned at any IHG hotel for American Express prepaid lodging cards. "Our members can redeem those points through any hotel in the world," says Mike Kopec, vice president of global alliances at IHG. "That's unique."
3. Accrue rewards in a currency that works for you
Many hoteliers now partner with airlines, retailers and credit card companies to offer multiple ways to earn points toward free travel. Hilton's HHonors lets you redeem rewards via points (to use for hotels and meals), miles (to use for flights) or a combination of the two. Business travelers who log more miles than they can possibly redeem on airfare each year may prefer to turn miles into points they can use at restaurants or hotels. For people who don't travel enough to accrue many points, programs like SPG let you combine cash and points for discounts on certain hotels.
4. Beware of blackout policies
In the movie "Duets," Paul Giamatti's character grows increasingly frustrated as he tries, futilely, to cash in his reward points at various hotels. In 2000, when that film was made, hotel "blackout dates" were so common that it was often impossible to book a last-minute room on reward points. Starwood launched its "no blackouts" policy in 1999, and it proved so popular that most chains have since announced their own versions.
Be aware, though, that all no-blackout policies are not created equal. Marriott, Hyatt and IHG reserve the right to have capacity controls on the number of rooms available for rewards. In January 2009, Marriott Rewards cut in half the number of points members need in order to reserve a room without blackout dates. Their hotels still can limit the number of rooms available for reward redemption on certain days, however, and popular hotels, such as the Waikoloa Beach Marriott Resort & Spa in Hawaii, will continue to have blackout dates.
"There is some smoke and mirrors in the industry that customers need to be aware of," says Burke of Hilton HHonors. "To most people, 'no blackout' means as long as a standard room is available, you should be able to redeem your points for it. Right now, only Hilton and Starwood offer that."
Complaints about blackout issues are far less common these days, but it pays to plan ahead if you want to book a room using reward points.
5. Take advantage of the new mobility
One way to book ahead, even on the fly, is to use your iPhone or Blackberry. Most major hotel chains -- including Choice, Four Seasons, Hilton, Marriott, Omni and Starwood -- are introducing mobile features to their loyalty programs, making it possible to check availability, book rooms and even check in from handheld devices.
Look for hotels to announce all kinds of mobile features for loyal customers this year, including GPS mapping. "Mobile technology is just exploding right now," says Chris Holdren, senior vice president of Starwood Preferred Guest, which launched SPG Mobile in October 2008. "We're working on new ways to use that mobility to strengthen our relationship with guests."
6. Use reward points when you need them most -- like now
Periods of economic uncertainty are the perfect time to use travel rewards. You can take that much-needed vacation without overspending, and resort hotels have rooms to spare. "The hotel companies would like people to use their free-stay rewards. Not only does it strengthen brand loyalty, it gets rid of a liability on their balance sheets and keeps people employed," says Joseph McInerney, president of the American Hotel & Lodging Association. "This is a great time for consumers to take advantage of rewards programs in places like Hawaii, where tourism is down."
Many hotel chains are running promotions designed to drive value to their regular customers during this economic climate, which helps compensate for the overall reduction of rewards by credit card companies. "In my view, loyalty programs were constructed for periods like this, to make customers' lives easier," says Holdren of Starwood. "Our members are using their points to book everything from flights to hotel rooms, to treat themselves to vacation without spending cash."
|Hotel rewards cards comparison chart|
|Card name||APR||Annual fee||Participating hotels||Rewards summary|
|Best Western Gold Crown Club Platinum MasterCard||13.24% to 16.24%||None||Best Western||10 points/$3 spent at all Best Western locations; 10 point/$5 spent elsewhere; 10,000 points after first purchase; up to 8,000 more points with balance transfers
|American Express Hilton HHonors||13.24%||None||Hilton, Conrad, Doubletree, Embassy Suites, Hampton, Homewood Suites, Waldorf-Astoria||6 points/$1 spent on participating hotels and U.S. supermarkets, gas stations, drugstores, eateries, postal service and wireless phone bills; 3 points/$1 on other purchases; 10,000 points for first four stays|
|IHG Priority Club Rewards Visa Signature||11.24%||None the first year; $29 after||InterContinental, Crowne Plaza, Hotel Indigo, Holiday Inn, Holiday Inn Express, Staybridge Suites, Candlewood Suites||3 points/$1 spent on participating hotels; 1 point/$1 on other purchases; 15,000 points after first purchase; upgrade to elite status|
|Marriott Rewards Visa Signature||13.24%||$65||Marriott||5 points/$1 spent on participating hotels; 2 points/$1 spent on airline, dining, and rental car purchases; 1 point/$1 on other purchases; 1 free night stay on enrollment; 15,000 points after first purchase; 15 nights credit toward elite status|
|Starwood Preferred Guest Platinum American Express||13.24%||None the first year; $45 after||Starwood, Le Meridien, Four Points, Westin, Aloft, Element, Sheraton, St. Regis, W, The Luxury Collection||2 points/$1 spent on participating hotels, stores; 1 point/$1 on other purchases; 10,000 points on enrollment; 1:1 transfer of points to frequent flier miles on 30 major airlines|
See related: Tips for using a debit card for travel, Credit card travel tips, 7 ways to get the most from rewards cards, Video: Credit card rewards and incentives, Video: Getting the most from rewards cards, Where some of the best rewards cards can be found, , Got bad credit? You'll pay more for an iPhone
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