Dynamic pricing is the name of the game now when it comes to booking hotels with points. Not all hotel loyalty programs have made the switch, but most of the more popular ones have. Hence, you might want to approach redemptions a little differently. Below are a few suggestions that could be useful to thwart some of the negative repercussions of dynamic reward pricing.
What is Dynamic Pricing?
Dynamic pricing means that reward rates work generally the same way as cash rates – they can vary from one night to the next. In the past, loyalty programs would put hotels into categories or assign fixed redemption amounts for point bookings. Those days are now gone for Marriott Bonvoy, IHG One Rewards, Hilton Honors and Best Western.
This change makes booking hotels more complicated because you can never be sure how many points you’ll need for a future stay. Optimal redemptions are always going to be a moving target. In light of this inherent uncertainty, you might want to alter or augment your strategy going forward.
1. Make speculative bookings
First, if you have an ample supply of points, you should probably take a “book now, think later” approach when you see an acceptable reward rate. Pay close attention to the booking terms before you lock it in, but most reward reservations are cancellable with no penalty. If you take a day or two to mull it over, the rate could shoot up.
This requires thinking about future trips a little earlier than usual but it could end up saving you lots of points.
2. Be flexible with your travel plans, if possible
It was easier to capitalize on sweet spots before dynamic pricing. With a bit of searching, you could find a hotel for a relatively low number of points when compared to cash rates even during busy travel periods. Nabbing such a booking was satisfying and straightforward.
Now you’ve got to be flexible. Because reward rates do not directly correlate to cash rates, you can still find good deals. And if you have lots of dates and destinations on the table, your chances of getting a bargain are much better. Open your mind to new places, different hotels brands etc.
Use flexible date calendars to find less expensive times or check large swaths of dates in an extended stay search where it displays the individual daily rates on the booking page.
For example, check out the variation in rates at the Canopy by Hilton Washington DC Embassy Row in November:
The outsized value of luxury redemptions of the past will be tough to match, but if you cast a wider net and focus on free nights instead of massive imaginary savings, hotel programs can still be very beneficial. One should certainly consider point value and choose redemptions over paid stays thoughtfully. But, in my opinion, it helps not to get too hung up on a strict cents-per-point analysis.
3. Keep checking rates after you’ve booked
This one’s probably the most important. Remember to monitor rates regularly after you’ve booked in case they go down. You can then modify your reservation or cancel and rebook. If you have enough points, it’s probably wise to lock in a new reservation before you cancel the old one.
While repeated checking may be annoying, if you look on the bright side, you could perhaps take some comfort in having the ability to cancel and rebook for no charge. (Unlike Air Miles who levy a nasty $10 booking fee online.)
4. Consider making a series of one night reservations
This may seem tedious, but it could serve you well. Say you have a three night reservation at 25k points per night. Then you check back later and notice the first night has gone up to 30k and the last night has dropped to 20k. There is no benefit to rebooking because the points total will be the same. However, if you booked the three nights individually, you could simply rebook the third night and save 5k points.
Obviously this won’t work if you’re taking advantage of a fifth night free perk. But for shorter stays, there is little downside other than the time it takes to make each booking (or each cancellation if your plans change) as long as you choose the same room type for all nights. Whenever I’ve done this I’ve been able to keep the same room for the whole stay. You might need to stop by the front desk to reset the key card but that’s not a big deal. (I’ve occasionally received multiple welcome points as well.)
5. Watch for larger rooms available on points
If you’re travelling to a city with numerous hotels in a particular program, be sure to check them all in case one offers upgraded/pricier room types on points. The cash difference is usually rather small when this happens, but occasionally you can stretch the value of your points this way.
For example, the Staybridge Suites Anaheim at the Park has three different room types available on points: a 1 king studio suite, a 2 queen studio suite and a 2 queen 1 bedroom suite. The cash rate of the 2 queen 1 bedroom suite was $27 higher than the cheapest studio on the random date I chose.
6. Diversify your points portfolio
With the unpredictability of reward rates, it pays to have multiple loyalty currencies at your disposal. Try to take advantage of any lucrative points-earning promotions for your paid travels even if they aren’t in your primary program. It might mean giving up the chase for elite status, but if you’re most interested in cheap or free stays, that’s not a big loss.
Notably, there remain a few hotel chains that haven’t crossed over – the two Radisson programs and Wyndham Rewards are examples. Choice Privileges with its quirks has not gone fully dynamic yet either.
Despite the trend toward dynamic pricing, hotel loyalty programs continue to provide terrific opportunities to save money on travel. It just requires a little more effort. For people who have flexibility with their travel plans, these changes are not as troubling as they are for those who can only take trips during busier times to popular destinations when reward rates will be higher. Still, there are ways to work the programs to your benefit if you use all available angles.