Hyatt Has a Giant New Hole in its Loyalty Program, and I Don’t Know If They Can Fill It

When I heard that Jeff Zidell who runs Hyatt’s loyalty program was leaving the company, I didn’t jump to post about loyalty program news instead I was just sad to learn news about a friend (whether it’s good or bad news for him, it change, and it’s bad news for us).

Here’s the thing: as someone covering travel companies and frequent flyer schemes, I do not have any friends. And it’s always important for someone doing what I do to remember that.

There are plenty of people that go out of their way to be nice to me (sometimes), though of course when I write things they don’t like my cell phone rings and I sometimes get an earful and they’ll even try to freeze me out for awhile which is silly because I get most of my information from myriad employees at a company not corporate communications.

Thinking about Hyatt and about Jeff I’m reminded of something really important: just how meaningful a trust relationship is in loyalty.

The first thing many people will want to do is talk about the World of Hyatt program changes that went into effect March 1. On net I think they’re positive for people who will keep top tier status under the new program, although there are things (like expiring free nights) that I don’t like. For anything below top tier the program isn’t close to competitive and former Diamonds who won’t earn Globalist are the biggest losers.

And the reason the changes have stirred up so much passion is that for customers who are no longer going to be top tier under the new rules that eliminate stay-based qualification, eliminate earning nights towards top status with credit card spend, and require more nights than before, it’s like being broken up with. Hyatt is telling folks below 60 nights a year, it’s not you, it’s me they just want different things.

Loyalty relationships are deeply personal and they’re intertemporal. They promise future benefits in exchange for your business today. They encourage you to spend more and go out of your way because you’ll be treated better and rewarded. And so many loyalty programs seem to have gone out of their way to undermine trust.

Throughout, whether you like any given set of changes or not, you may miss Faster Free Nights or stay (“G”) bonuses, you may not like being told that Hyatt doesn’t love your 25 stays as much as they used to, Jeff has always been honest and earnest and he’s rare in the loyalty community. He and his team think about what they’re able to do for customers that matter most. Like a handful of people I’ve met, he actually thinks about what’s best for the member and not just what can be squeezed from the member.

One time a Hyatt PR representative straight up lied to me about something I was covering. Jeff found out about it, called me, I think it was on Christmas Eve that year. He wasn’t ok with what had happened and made darned sure everyone knew it. Any other program would have been totally burned with me, but I knew where Jeff stood.

Frankly the Hyatt trust relationship has been a relationship with Jeff and with a handful of his colleagues that have supported his efforts over the past decade at Hyatt. With his departure the company has a huge hole, and I don’t know how they fill it. There’s an interim head of the loyalty program, but they haven’t earned the same level of trust that Jeff has. I don’t know how anyone in the position on an interim basis could. And his replacement is going to have to pass muster with people in the company that haven’t earned the same level of customer loyalty either in their time at Hyatt or in the roles they held before.

Agree or disagree with Hyatt’s loyalty program decision-making — and I think it’s a mistake the way the new program positions itself to turn its back on 30, 40, and 50 night customers, and also that they’re way too small a footprint to require 60 nights for top status without help from the credit cards or even counting award nights — it’s been clear where Hyatt stands with Jeff Zidell stewarding the loyalty program and customers could trust that benefits were being managed fairly. That’s the kind of gold that’s very hard to buy, that takes many many years, and that’s so easy to lose.

I have to imagine Hyatt didn’t fully appreciate the asset they had in Jeff otherwise they’d have gone to tremendous lengths to keep him. They’d be wise to promote from within the loyalty team, with folks steeped in that culture of trust, but I wouldn’t expect to see them go in that direction. There are big shoes to fill, for their members’ sake I hope Hyatt is up to the task, but in the meantime we have to take a wait and see approach at best I think.

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 InsideFlyer.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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  1. @ Gary — appreciate your sharing of personal experience with Jeff but how do you reconcile him wanting best for GP members with detrimental-for-most WoH changes in general and that disastrous Reddit AMA in particular? It was such blatant example of corporate-/marketing-speak, it was almost comical.

    Do you have any idea whether Jeff left on his own due to disagreeing with WoH or is it the opposite and he was pushed out due to bugling of WoH?

  2. If you believe that frequent traveler loyalty relationships are deeply personal, you are hopelessly naïve. They are not viewed as such by the program providers. They are simply marketing schemes.

  3. To sum up, you think the new Hyatt loyalty is a mistake and Jeff is not responsible because he is a good guy and have a good relationship with you? !

  4. This whole article makes me want to vomit. The only thing that can be trusted is WOH is a gross missetep in the wrong direction.

  5. @Ivan Y – I wouldn’t ever do an AMA with corporate communications staffers involved, where you’re not able to be 100% candid. I don’t think that experiment was wise. Programs make changes and as I say I think they benefit a narrow lucrative group of customers and make Hyatt uncompetitive for others, all beside the point to this post.

  6. @Gary consider the optics of your article before posting and chastising someone for “misunderstanding”.

  7. I agree with you. Hyatt made it perfectly clear that me and my 25 nights are not valued. Its their hotel and their decision. Marriott aeems to like i am able to get Gold now.

    I wish Jeff well but that AMA on Reddit really was a disaster.

  8. As a person, Jeff Zidell is a great, great guy.

    As the head of a loyalty program, he destroyed a decade of carefully built goodwill in under six months. The Reddit AMA destroyed what remained of his credibility.

    I am grateful for all he has done for HGP members in general and myself in particular. But it was time for him to go.

  9. @ Gary — After about 10 years of me and/or my SO being Diamond with Hyatt, we are done. We are both Diamonds for 2017, and maybe will use 3 or 4 DSUs between us and maybe stay 20 nights between us. Sad that Hyatt screwed up so badly. It was OK while it lasted, but Hyatt never really impressed me anyway. I won’t miss Hyatt.

  10. One’s “friendships” are like rose-colored glasses…

    While admittedly a likable guy, Jeff Zidell had no clue how to run a loyalty program, and WoH! is a reflection and culmination of that fact. Under Zidell, HGP was, at best, a work in progress (WIP); at worst, a joke, despite its placement on a pedestal by self-anointed ‘travel gurus’. The program had many “innovative” promotions and perks, but most were utterly boneheaded and easily abused and, thus, ultimately unsustainable. A prime example are the Diamond challenges that gave the challengers all the benefits upfront! I never took the “challenge” because I knew that it was all fluff and no substance. Worse, many who took the “challenge” just enjoyed the Diamond benefits without ever intending to requalify and remain loyal to the program. In short, it was all quite heady and “lucrative” stuff, which is blogger-speak for a benefit or a promotion that is exciting but boneheaded because it is easily abused. The program would eventually catch on, which is why HGP’s benefits or promos were usually introduced and then pulled or scaled back, creating the impression of a program in a constant state of flux — a WIP.

    With the preceding in mind, it is easy to understand why some might have considered HGP a “great program”: it constantly offered “lucrative” (as defined above) perks and promos that excited the masses, but were ultimately ephemeral because they were substance-free, easily abused and unsustainable. The end result was a program that never achieved the stability, maturity and consistency of programs like Hilton Honors or Marriott Rewards which, though much maligned by self-anointed ‘travel gurus’, are now the only ones standing!

    In a bizarre twist of fate and irony it can be said that Jeff Zidell is out because with WoH! he managed to get Hyatt out of the hotel loyalty business — WoH! is essentially like a country club — thereby making his own position within the company irrelevant.

    G’day!

  11. Jeff is the best in the business. No comment on the program changes, but Jeff is the best full stop. Gold Passport was the program that scaled with me and kept me loyal more than any other. From the weekend I took the 3 day California bar exam 16 years ago at Hyatt SFO and they felt mercy and hooked me up to the present as courtesy card holder and dropping 250K a year at Hyatt for law firms events – and every day in between (including over a YEAR of my life at Grand Hyatt Kauai on FFN, LOL…) – Hyatt was there and a loyal, loyal friend. World of Hyatt is a recent blip and course correction is probably certain as would be for any major program overhaul, but focusing on the last 15+ years, Hyatt was and is the best overall and its all due to Jeff, really. A super innovator and custodian of the kind of “trust” you talk about Gary. — Thesilb

  12. Sorry about Jeff. I’ve taken my business elsewhere and I doubt it will ever come back under WOH. It is puzzling that Hyatt went to World of Hurt soon after offering generous status matching to Diamond. That made me a Hyatt customer. And, probably just as important to Hyatt, reduced my stays at Starwood, Hilton and Marriott. World of Hurt made me a former Hyatt customer. Zero Hyatt nights to 37 Hyatt nights to 0 Hyatt nights. Nothing personal about my leaving just as the changes he instituted were not directed at me (although definitely affected me) personally. Happy trails to us all.

  13. Umm, the giant hole was created with WOH, when Jeff was still there.

    it’s like saying there’s a giant hole now that your spouse finally left, when he has been cheating and unsupportive for a year.

  14. Wow … I just think that viewing loyalty programs as deeply personal is somewhat inexplicable and bewildering. They are marketing programs and rebate schemes. Nothing more and nothing less.

    We’re talking about corporate businesses here. Give me a good product or service at a fair price that represents a good value and you have a good chance of getting my business again. Very little emotional involvement/investment required.

  15. Gary where do you think Jeff goes next? Are any loyalty programs hiring?
    Perhaps it would be good to see him have another shot at improving a program.

  16. Gary, you are a great blogger, but I don’t get this post.

    You still argue that the WOH is a better program, but yet it seems that the majority would say the new program is significantly worse.

    You say that Jeff and the loyalty program is going to be so hard to replace. Was Jeff not at the helm when they made this tragic new program and direction? Really, my 8 year old daughter could come up with changes that are this bad or not well thought out. A program that might encourage you to not stay especially if you want to time your 60 night threshold at a time so you can use the limited time certificate? What about the last couple of years promotions…..just a copy of the last one. What about this years? Really doesn’t seem that Hyatt GP has done much lately, except tick off myself and many other loyal customers.

  17. @DCS You are always quick to bury Hyatt, so I am curious to hear what you think that Hyatt SHOULD have done to compete with much larger chains like Hilton and Marriott, and the other internet darlings SPG. How would you have brought money into Hyatt that would have otherwise gone to those (and other) chains?

  18. @Tokyo Hyatt Fan asks: “what you think that Hyatt SHOULD have done to compete with much larger chains like Hilton and Marriott, and the other internet darlings SPG.”

    Simple. Rather than trying too hard to be “hip” by going only for offers or benefits that would be perceived as exciting and/or innovative, but were too good or too easily abused to be sustainable, HGP should have learned from their mistakes and worked toward building a stable and rewarding program based less on fluff and more on substance. They should’ve analyzed the results of various benefits and promotions that they’d offered over a period of time, set in stone those that worked and were popular with members, gotten rid of those that did not work, and then let it all mature, with only minor tweaks at the margins.

    Only after establishing a stable program capable of withstanding more “violent” structural changes would it have made sense to try a wholesale transformation like going from HGP, which was and remained a perpetual WIP, to WoH! A prime example of what I mean is Hilton Honors, which recently introduced fairly drastic changes. The program went fully revenue-based, got rid of their award chart and put their C+P awards on steroids, and, despite initial concerns by members and warnings by bloggers, it emerged stronger and more rewarding. Its maturity and stability enabled it to withstand pretty serious foundational and structural changes. Another difference is that while HHonors managers are less flashy and do not have the winning smile of a Jeff Zidell, they are extremely good at what they do. It seems that they would not implement anything new without first doing an analysis of its long-term impact or ramifications. That is why they’ve pulled off their status matches or challenges smoothly every time, while HGP invariably botched theirs, with the last one they botched when they tried to attract disgruntled SPG loyalists giving them such a crippling indigestion they decided to do a ‘Hail Mary’, and ended up with what’s now known simply and appropriately as WOH!

  19. My complaint with Hyatt isn’t even the fact that the footprint is small. It’s the fact that the vast majority of hotels in the program are Hyatt Places and Hyatt Houses, where my 60 nights a year would give me exactly 1 benefit: 4pm check out. Sixty nights a year — two months of nights, forced to spend most of those nights in limited-service crappy properties on the outskirts of town so that I can continue to get almost no benefit at those properties? They were out of their mind with that expectation.

    When you couple that wacky expectation with the fact that the relatively tiny number of desirable properties often play games with inventory to prevent you from using points/awards…..and the crappy new expiration of free nights, it’s just bizzare. I understand if the old program was too generous, but I have to imagine that the new program is costing them a large number of guests who would have been willing to make 30 stays a year but will now burn points for a year, enjoy free parking in cities like New York and take expensive suites out of inventory by upgrading those points stays, and then bounce next March.

    I didn’t have the opportunity to know Jeff, but at the very least he was complicit with those changes.

    For the record, I know that they didn’t expect 25-stay folks to hit 60 nights (and in fact they were obviously looking to thin the ranks — so they wanted many/most of those folks to not re-qualify), but to throw those customers away completely seems shortsighted at best. Even a 35-stay requirement would have significantly thinned the herd without completely throwing out the segment of customers who aren’t engaged in business travel to the small handful of cities with worthwhile Hyatt properties.

  20. Gary, isnt Jeff responsible for the WoH rubbish crap nonsense today?

    Why would he still be trusted?

    I think many would be glad to see the end of him as he does not look like reversing his disaster.
    (Unless hyatt hotel room occupancy went up further..which all the more he shld stay on)

  21. “Hyatt is telling folks below 60 nights a year . . .” Except, of course, those apparently large numbers of people of an apparently undisclosed number of companies who have just been offered Globalist after only TWENTY nights.

  22. Agree with several of these comments including @ron and @nick

    It was clear from the botched launch (they did not even inform their “Hyatt Insiders” before they issued the press release that this was going to go over like a lead balloon. Indeed, Hyatt has to run a business – but when you are one of the smaller hotel chains, you should aim to ‘make it easy to do business’ with Hyatt. World of Hotels has gone in the other direction. Unless you are 60 nights+ a year, Hyatt has said “we don’t value your loyalty.” To me, that’s too bad – b/c I like their mainline hotels and think service at Hyatts is generally quite good. I’m a ~50 night a year traveler and for the past 10 years, I’ve focused my travel dollars on Hyatt b/c Gold Passport made me feel valued (upgrades, welcome amenities, and free breakfast). I don’t really care about the points.
    Given their small footprint, it would be nearly impossible for me to hit 60 nights/year in the cities that I travel to regularly. So, as others have mentioned, I’ll take my $12-15K in hotel spend elsewhere and I’ve already cancelled my Hyatt Credit Card.
    Who knows what is really going on with corporate/Hyatt – but they have lost a quality individual in Jeff, who worked well with loyal GP members over the years and represented the brand well. I suspect there is much we don’t know about the World of Hotels strategy/change – but one place to look is the Hyatt CMO, Maryam Banikarim. Her comments at the launch of World of Hotels seemed to suggest a incoherent re-positioning towards millennials and a lack of understanding about the travel/loyalty business. Another thing to consider is the future of Hyatt – the hotel business is now being run on scale and they are the small(er) operator relative to Marriott/SPG, Hilton and IHG. This would suggest to me that we don’t know what their future will bring re: a sale or M&A.

  23. I found Hyatt 2 years ago and would have easily given them 40+ nights this year, but WOH has me turned to the Starwood and Hilton for my paid business.

    Interestingly I’m located in Chicago and got a pre-qualification survey for a focus group for WOH later this month. I sincerely hope I get picked.

  24. I’m another one of those regular Diamonds who really liked the program, used the Hyatt Card and actively encouraged people in and out of my company to stay at Hyatt and get the card. It appears my Hyatt loyalty will end in 2018. I can’t (and wouldn’t want to)get to 60 nights regularly. The benefits for 30 nights seem very poor and not remotely worthwhile to me.

    Any suggestions on other hotel loyalty programs?

  25. Has anyone thought that possibly Jeff did not create the new WOH? Possibly he was directed to go this route and when he was not happy with this direction either he decided WOH was not for him either. Just a thought?

  26. I’m already way over 30 nights. Hyatt Gold Passport works great for me! The new Hayatt Regency in Amsterdam is great! Will be at the Andaz on 5th Ave for the weekend on points and cash. Hope you haters all leave the program…

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