My recent stay at the Park Hyatt Vendome in Paris — where I had one of the absolute very best breakfasts of my life (that segment of the trip report is coming) — really crystalized in my mind the value of hotel elite status.
I still love my lemon poppyseed pancakes at the Andaz 5th Avenue but the American breakfast at the Park Hyatt runs to 49 euros per person. And the amazing thing is that it wasn’t just expensive, it was probably actually worth that.
So I sat in my hotel, one of the better properties in one of the more expensive cities in the world. And I ate my 49 euro breakfast, of course a Hyatt Diamond is entitled to full breakfast for up to 4 registered guests in the room. And on the 3 nights where the hotel was actually sold out Gold Passport was reimbursing the property 800 euros per night for my room.
And I said to myself that hotel elite status can be really valuable.
But just how valuable, and at what cost?
So I played with a little spreadsheet this afternoon to try to answer that question for myself. Everyone’s numbers are going to be different, based on their travel patterns and their redemption behavior — and what they actually subjectively value things at (a hotel breakfast might cost $20, but you might not be willing to pay $20 for it — if it wasn’t free you’d go down the street — so you shouldn’t value it at $20).
Nonetheless, I’ve made a few assumptions that I don’t think are entirely unreasonable. And I’ve even left out some of the benefits of status entirely, on purpose, to keep the estimates fairly conservative.
I used Hyatt Gold Passport for this illustration, since it’s the program whosse points I was using at that Paris hotel. But we can substitute other programs and come up with answers as well in a similar fashion (I suspect the value will be lower in some programs — the benefits of Starwood are great but in-hotel earn is weaker, the benefits of Priority Club and Marriott Rewards aren’t as generous). See what you think.
I’m assuming that a top tier elite makes that status on 50 nights at an average room rate of $135 per night, which for a top tier elite is probably low. The rate and number of stays matter of course for how many points are earned.
I assume that the stays all earn a points check-in amenity, and that a quarter of the time they have to be posted manually (earning 500 more points each of those 4 tiems). But that isn’t necessary, those manual postings and two of the Diamond amenities could be foregone and still generate the same 3 night category 6 redemption at a property like the Park Hyatt Vendome.
I value internet and breakfast, I think, conservatively. For instance I assume that breakfast is taken only 60% of the time on paid stays, and for one person only, and never at a value above $20. I also place what I believe is a very modest value on suite upgrades.
And here’s what I leave out entirely:
- Points earned via credit card for the hotel spend
- American Express OPEN 5% rebate for domestic Hyatt stays
- Any value for 4pm late checkout
- Any value non-confirmed upgrades (better room at check-in when not confirming a suite)
- Any value for club lounge/evening appetizers and cocktails
That’s why I think my estimates are subjectively reasonable, though different folks will value these things differently.
And I come out with $6750 in hotel spending for the year generating $5271 or a 78% rebate in Diamond benefits.
You can make your own spreadsheet based on how you value the points. You might never pay for a hotel like the Park Hyatt Paris and thus should discount the redemption value of the room. But even if you dropped the value of the redemptions in half, you’d still be getting an effective 60% rebate on your hotel stays — while still leaving out the value of several benefits received during the year.
My takeaway is simply this: loyalty has real value for folks that are able to concentrate on a chain and stay frequently enough to earn top tier status. It’s probably more valuable than you thought.