Understanding Starwood Preferred Guest: Hotel Awards

Key Link: Starwood Preferred Guest American Express card

Starwood Preferred Guest isn’t an especially rewarding program for earning points based on the money your spend at its hotels.

It is, however, an exceptionally generous program for earning points from the money you spend on its credit card.

Starwood hotels are your Westin, Sheraton, Le Meridien, W, St. Regis, and other associated brands. A non-elite member earns 2 points per dollar spent at a Starwood hotel property. It’ll take $5000 spending (without elite bonuses) to earn a free night at a medium category (four) hotel. Leaving aside even the top of the top hotels in the chain, it’ll take $15000 spent at a hotel to earn a free night at their very expensive properties.

Compare that to Hyatt where a non-elite earns 5 points per dollar spent at a hotel. A mid-tier property (call it category 4 as well) takes 15,000 points per night — or just $3000 in spend rather than $5000. (Update: type fixed, I hate written ‘$500’)

A top-end property is 22,000 points per night. That’s $4400 in spend, a whole lot less than $15,000 at Starwood (and Starwood charges even more points for some hotels, the comparison gets even more extreme truly top-end to truly top-end).

I love Starwood’s elite benefits, not as much as Hyatt’s, but more than Hilton, Priority Club, an Marriott.

But where things really shine is with the Starwood American Express. Earning 1 Starpoint per dollar spent is huge. The points are really valuable on hotel stays, and also hugely flexible transferring points into miles. I’ll deal with points to miles in a separate post, but it does set Starwood apart.

  • Starwood set the standard for room availability. They introduced ‘true redemption’ — no blackout dates or more importantly, capacity controls on award nights. If there is a standard room at a hotel available, you can have it for points. That’s industry norm now, but only over the past 3 years. For nearly a decade Starwood was the pioneer in this, mostly alone in the field.
  • Starwood has really great aspirational properties. They aren’t as big a chain as Marriott, Hilton, or Priority Club. But at the top end — hotels you really want to stay at — Starwood has more than anyone else.
  • Cash and points awards let you stretch your points even further. They were the leader in this category as well.
  • They offer the best value for free nights from credit card spend. It may take $5,000 in-hotel spend to earn a free mid-tier redemption. It takes only $10,000 in spend on the credit card, while it would take $15,000 spend on the Hyatt category for a similar room and perhaps double that with Marriott or Priority Club.

Here’s the Starwood free night and cash and points award chart:

With each of the free night (not cash and points night) awards, category 1 and 2 hotels get a 1000 per night discount on the weekends, and in addition the fifth night is free on all free night (not cash and points) awards. So a 5-night stay at a category 3 property costs 28,000 points rather than 35,000. Or — one of my favorite resorts is the Le Meridien Chiang Rai, a category 2 property — a 5 night stay where 2 of the first 4 nights are on the weekend would cost just 14,000 points. So you could stay more than 10 nights there with just the signup bonus on their credit card.

Cash & Points awards stretch your points, looking at it a different way they are letting you buy some of the points for your award night at a discount. Category 3 and 4 cash and points awards you’re basically buying points at a penny apiece (plus tax), other categories it’s more like 1.25 cents (plus tax). The new Category 7 cash and points awards it’s over 1.8 cents during ‘low season’ when an award would cost 30,000 points, it’s about 1.4 cents when the award night would have been 35,000 points.

Cash and points awards are capacity controlled. Starwood was able to get full availability for standard rooms on free night awards because they will pay a hotel its average daily room rate for those free nights whenever the hotel winds up at 90% occupancy. Basically when the award night potentially squeezes out a paid night, Starwood pays full price for the room instead of its own internal deeply discounted price. Cash and points awards don’t come with that extra payment, so hotels only make the awards available when they don’t expect to sell out.

Starwood was also a pioneer of premium room awards, the ability to spend additional points t confirm an upgraded room. This is great for non-elites especially, or for the special occasion, you save all your points for a special getaway…. an ocean resort you actually want to see the ocean… and you don’t want to leave it to chance.

Depending on the hotel category and the room type you want (and not all hotels offer premium room awards, or make all rooms available with this option), you can spend 1000 to 2750 points per night for an upgrade, or double points for a suite.

Priority Club doesn’t offer this at all. Hilton offers it but you’re basically using points at an unfavorable valuation to buy the higher-category room.

Starwood offers fixed prices which means that it’s often a good value. And a way for non-elites to use points and make their stay special. (Hyatt has a similar option, also at a fixed points price, and suites in their program are about 50% more than a regular room.)

A less-remarked on redemption option, but that provides tremendous value in a variety of circumstances, is the Nights & Flights award. If you are going to redeem for a 5 night hotel stay at a category 3 or 4 property you can spend a few more points and also receive 50,000 airline miles with most of their transfer partners.

  • A 5-night stay at a category 3 property normally runs 28,000 points. For 60,000 points, or 32,000 more, you get 50,000 airline miles — a discount of 8,000 points compared to redeeming Starpoints for airline miles directly.
  • A 5-night stay at a category 4 property normally runs 40,000 points. For 70,000 points, or 30,000 more, you get 50,000 airline miles — a discount of 10,000 points compared to redeeming Starpoints for airline miles directly.

So very useful whenever you have a 5-night stay planned at a category 3 or 4 hotel.

All great redemption options. But whatever you do, though, don’t be tempted by SPG Flights — the ability to use your points to straight up pay for an airline ticket. You’ll get a bit better than a penny a point, one of the least valuable redemptions on offer. If you want to get an award ticket, you’re usually better off transferring points to an airline rather than buying the ticket with points as cash. And if it’s not a good value to redeem an award ticket, then you should probably just be buying the flight. Your Starwood points are a valuable currency, don’t waste them!.

I’ve been carrying the Starwood Preferred Guest American Express top of wallet since 2001. I didn’t get any signup bonus back then, although I did message Amex once or twice and tell them that I felt like these big bonuses they were giving out meant that they valued new customers without any history as a cardmember more than me, and they gave me some points as a courtesy.

(Note that the Starwood Preferred Guest American Express provides me with a referral credit if you choose to use my link to sign up. I genuinely appreciate it if you do. And the link offers the best signup bonus I am aware of.)

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community Milepoint.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. Great piece, Gary, simply put yet profound as it truly belongs. Starwood, like American in airlines, have created a mania, a sort of blind following of the SPG point, which we had discovered was not just “valuable” currency – in many respects it was “more valuable” than any other currency – a trend that the changes last March are bound to have raised even higher. I heard that various categories of guests leave more money behind when staying at Starwood than they do at any other property.

    However, SPG did sneak in another currency of slightly different usage but superior in value to the Starpoints – the Stays…. Aaaahhhh, with the Stays becoming the only way to reach premium levels of the Program, SPG ensured that they continue to have you reach for that AMEX card again and again, right on their premises. What a brilliant plot!

    The top-of-the-wallet since 2001 rang true as it has been the same for me for all these 11 years – when a bunch of the analysts in McKinsey’s New York Office put together a beautiful model that valued each of the 40+ points based cards in out pockets, to appoint the SPG card as the uncontested King of The Hill. Keep it coming, Gary.

  2. Flights and Nights . . . geez, and I thought I knew every SPG promo there was. Question: The T&C states “The maximum transfer to the airline offered in this award is 50,000 miles”. Do you happen to know if a person could get multiple 50k airline miles with multiple airlines?

  3. Hyatt card = platinum status (free internet, late check out) + free anniversary night; until SPG Amex offers something free EVERY year, I think Chase has this beat. You dont have to spend a penny to get the free anniversary night + you get two free nights upon opening.

  4. Gary, I got the personal card about two years ago and closed the account a few months back. Can I get the bonus again if I apply for this offer expires? Thanks.

  5. @Jeffrey you can do more than 1 Nights & Flights award (wait at least a day between them) and earn more than 50k total miles

  6. Gary, you forgot that while you get 1 point per dollar for all purchases, you get 2 points per dollar for spend at SPG properties (room plus F&B). Makes me eat more hotel restaurant meals than I’d like!

  7. Hi Thanks for this review! I have a question. Coincident with my signing up for this card, I may be bringing a team of people to stay in a Starwood hotel, something like 200 nights and 50k spend. How can I make the most of this to gain points and or status?

  8. @Levy Flight – you can earn points for 3 rooms at a time that you settle at checkout. Or you can set up a meeting contract and earn 1 point per 3 dollars spent. $100k in meeting spend earns platinum status as well.

  9. Gary: Thank you for this helpful post. Very well written too. I am new to this world and recently applied for and received the SPG card. Your post help me make the best use of this card. I think I will concentrate my hotel stays at Starwood and Hyatt based on what I have read so far.

  10. @Gary,

    What @J Rice said, change “or just $3000 in spend rather than $500” to “… rather than $5000”.

    Since I’m already easily Diamond and just acquired the SPG Amex card I’m doing a Platinum Challenge with SPG now. Seems like an easy way to hit the $5,000 in six months and attain Platinum status as well.

    As with any of these things though, YMMV. Here in San Jose where I stay a LOT, the Hilton I usually stay in is really great. And for the same price the two available Sheraton’s just aren’t. Not a problem for some of my stays, enough to hit Platinum each year probably, but given a choice, I’ll still be spending more of my nights in a Hilton. Also depends where you want to go of course. Do I want to spend my next Maui vacation at Sheraton Black Rock and trust in the Platinum gods that I’ll be bumped up to an ocean front room, or blow a bunch of Hilton points to stay at the Grand Wailea?

  11. Gary,

    If SPG isn’t very rewarding for actual spend in their hotels, what chains are? How do Hyatt, Marriott and Hilton compare for dollars spent at actual hotel properties?

    Also SPG has a forex fee. What card (and corresponding chain) provides the best earning power for foriegn spend?

  12. @Lee for foreign spend I use the Chase Sapphire Preferred, double points on travel (including hotel) and no foreign currency fees. Hyatt, Marriott, and HIlton are all more rewarding for in-hotel spend. I should do a post comparing them all…

  13. @Kevin I would put spending on the Starwood card rather than the Platinum Amex, Starwood points are more valuable than Membership Rewards points. But you keep the Platinum Amex for the lounge access, etc

  14. They are more valuable because of the 1.25 transfer?

    Should they be used for Hotel stays or flights? I’m trying to get my head around the whole hotel and points thing.

    I charge about $300,000 on different cards and haven’t really ever used them for hotel stays because I find the first class air redemptions to be more valuable. (Three brewpubs and all the supplies!)

    Please advise!

  15. @Kevin because of the transfer bonus and the greater variety of airline transfer partners — American and not just British Airways for oneworld, US Airways and not just Aeroplan/ANA/Singapore for Star (so no fuel surcharges), etc.

    Amex points should always be used for airline mileage transfers. Starwood points can be valuable in both ways, hotel or airline.

    I agree that the airline tickets are often most valuable. But you can frequently get 4-6 cent redemption at hotels using cash and points.

  16. Just got the SPG Amex on your recommendation. Of course, I used your referral link. Thanks for all of the helpful info!

  17. You don’t get 5th night free on Category 1 and 2. So your example of 5 night(including 2 weekend nights) at Le Meridien Chiang Rai, would be 18,000 points, instead of 14,000

  18. @Gary,

    I am planning an upcoming vacation and intend to stay at a category 4 Westin property for 5 nights using 40,000 of my starpoints. Despite the fact that I already have my flight arrangements made and do not need frequent flyer miles for those flights, should I nonetheless utilize the Nights & Flights redemption option to bank the extra 10,000 frequent flyer miles?

  19. @Gary – thanks for the quick response. Current spg balance of around 150k. Probably move to US Air Dividend Miles.

    Does your travel booking service have a strategic planning option? For example if a customer wanted to travel to a say Mauritius in spring of 2014 but needed guidance on where to accumulate airline miles and/or hotel points for the trip.

  20. @Gary: thanks for the great analysis. I just used your link and got the card approved. I have AmExp Gold premiere rewards, Chase sapphire preferred and Chase Marriott. Which card should be used as second best after spg ? Thanks.

  21. @Vicky – I think Sapphire Preferred is your next best card.

    I don’t like spending on the Marriott card.

    Amex Premier Rewards Gold is good for 3x on airfare, 2x on gas and groceries — only worth the annual fee though if you spend $30k in those categories and earn the 15k point bonus for it. (I do on mine.) Otherwise the fee on the card is pretty high.

  22. Gary, I just received the SPG personal card to accumulate lots of Starwood points for a trip to Hawaii next year (thinking of the sheraton Black Rock). However I fly Jetbue many times during the year and am using the AMEX Everyday Preferred card to gather points for flights on Jetblue since the Jetblue AMEX pays points below average.

    Does the SPG card transfer points at all to Jetblue in any way or fashion? I’d love to use the SPG card for everyday spending.

  23. I love Starwood!!!! I am super excited about using the buy 4 get the 5th night free. This is going to be awesome for my future travel.

  24. My only “thing” in reading the article and the ensuing comments was this idea of “I’m a Gold Member Passport Diamond Regal Ruby Member.” All that dumb title does is plaster “entitled, rich, rude, asshole and wife” on your heads and only means that you fell for their marketing ploy (making people pay a fee that makes them “feel” exclusive). Hotel staff and management don’t look at you or consider you any different or any more important than any other guest (i know i work in one). In fact programs like that over the years have fostered the exact OPPOSITE effect. Staff enjoy serving people who genuienly enjoy it, not who feel entitled to it. Spend your money where it really will get you the best service on the planet: tip your staff. It’s cheaper and will get you anything you want. Now THAT’s a travel tip!!

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