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View from the Wing and Loyalty Lobby flag a stealth IHG devaluation beyond the fact that at least one Six Senses property now costs about a quarter million points per night: some Holiday Inn Express properties are now running as much as 70,000 points per night, Kimptons are up to 85,000 in some cases, and some Intercontinental properties are now as high as 120,000 points per night. Loyalty Lobby notes a number of examples showing that IHG appears to be pricing many properties at a value of under 0.4c per point. That stinks.
Back when IHG had an award chart, it topped out at 50K points per night until early 2016 when they introduced a 60K level and then 70K in 2018. On our last podcast episode, Greg noted that one of the positives of IHG moving to variable pricing has been the fact that you can sometimes use 40K free night certificates from the IHG Rewards Premier card (or the no-longer-available IHG Rewards Club Select card) at nicer properties where you may not have had the chance to use them previously.
Unfortunately, View from the Wing and Loyalty Lobby point out the problem at the other end of the spectrum: some lower-tier properties have gotten out of control with the variance of variable pricing. While Gary flags the Holiday Inn Express Zion Springdale at as high as 70K points per night, that property isn’t alone in that range. The Holiday Inn Express in Cooperstown, NY ranges this summer from as low as 26K points per night:
To as high as 63K points per night.
Again, to put that in perspective, that’s more points per night than the top tier of IHG just a couple of years ago. Properties like the Intercontinental Bora-Bora for fewer points per night than this rural Holiday Inn Express is charging. To be fair, Cooperstown draws a large tourist crowd in the summertime and there is an absolute shortage of rooms, so room rates tend to be high — the lowest cash rate for the same night was $293. On the other hand, it’s worth noting that the Holiday Inn Express isn’t actually in Cooperstown since they don’t allow chains within the town, so you’re looking at 63K points per night to stay on the side of a rural highway surrounded by rolling hills and….not much else.
And while redemptions had topped out at 100K per night before the addition of the Six Senses properties, we now see that some properties like the Intercontinental Maldives are now up to 120,000 points per night.
That is more than double the top tier of just 5 years ago. Ouch.
It doesn’t help that base earnings for the credit card and loyalty members haven’t seen any increase during a period in which hotel award pricing has skyrocketed. While we’ve seen increased welcome bonuses on the IHG credit cards, it isn’t any easier to earn points en masse today than it was five years ago — and given the general weakening of IHG Accelerate promotions, it may even be harder to amass IHG points today for many members.
And worse yet, Loyalty Lobby points out extensive examples where hotels are pricing awards at a value of between 0.34c and 0.38c per point. Most hotels had previously been pricing at around half a cent per point, so this appears to be a pretty significant devaluation across the board. This isn’t true in all situations — you’ll still find some instances where points are worth more — but overall, the news is not good.
None of this is particularly surprising; we knew when IHG introduced dynamic pricing that it would lead to some hotels creeping in price during periods of high demand. Nonetheless, it is disappointing to see lower-tier brands approach the top tier of less than a year ago.
On a recent Frequent Miler on the Air podcast, we addressed a reader question about whether dynamic pricing has made us more bullish on the IHG Rewards Premier credit card. We essentially said that it hasn’t — and this certainly does nothing to change my mind.
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Next up in the death spiral brought on by the bean counters, getting rid of the fake tasting eggs at the breakfast buffet and the bottles of lotion in the rooms.
While the top end has only gone up-up-up, the bottom end is also out of whack.
I’ve been happily burning Hilton points in Bangkok at around 10,000 a night for the 4 star Hilton Sukhumvit (which works out to less after promos and 5th night free).
Down the street is the Holiday Inn Express, which is a far cry from the Hilton. Street rate is about $30 but I can pay 5000 points + $35, yes that’s right, more than the street rate PLUS 5000 points, thanks! Or 10,000 points straight up. 10,000 must be the IHG minimum because I see it all the time for hotels that sell in the 30-50 range. Needless to say, I’ve been ham-fisting my points but sounds like I’d best spend them, and probably time to cancel that free-night cert card that is getting close to being worth less than the AF. The death of Pointbreaks was pretty much the death of this loyalty ponzi scheme.
Based on refreshing a search that I did earlier in the week, it seems like the changes are pretty random in amount and direction, although I believe that the majority of the properties in the area/dates I checked changed. There seems to be a wider variation in points values today.Sorry to be vague on details, but when I searched before, I was primarily interested in one or two properties, and since I was planning to use a free night certificate, I was mostly checking to see if those properties were at or under 40K/night.
I also think that in some cases, characterizing these changes as “massive devaluations” is only true in comparison to bargain pricing during the pandemic, rather than considering them in historical context. IHG is my third or fourth preferred hotel chain, but I do have the old IHG Select card with an annual free night certificate. I was going to use one in April 2020 for a Holiday Inn Express (HIE) near FLL for a layover. I was pretty surprised that HIE properties near the airport were 40K, and remember debating using the certificate or paying cash, since the redemption value was around $0.004 cpp (basing the cpp on my corporate rate which often tends to be lower than public rates). I ended up booking with the certificate (the trip was later canceled) because I did not have concrete plans for using the free night by August, and I was generally disappointed by the hotels that were available at or under 40K. As another data point, a Hotel Indigo I was considering for early June 2021 was pricing at 17.5K points (some nights) before the recent changes and 28K after (but the cash rate was $206 + tax, so this still is a decent cpp). I also saw nights at this hotel varying by day from about 17.5K to around 40K points for early December 2020 or February 2021. I stayed at this hotel years ago (long before IHG had variable pricing) and the hotel was 25K/night then, and I know it went up after that (I think to 35K/night).
I also expect that pent up demand is going to drive travel prices (including variable pricing on award flights/hotels) higher, as companies seek to recover whatever they can after a terrible year. Some of the examples provided are outrageous, and no one likes seeing the price of a trip they are planning double (or more) overnight without any warning. But, like many others, I am not surprised by IHG making customer-unfriendly changes.
I appreciate the time you took to write the post but you’re wrong. HIE were not going for 70k for a $210 room in Springdale Utah pre-COVID.
Was just thinking about putting some actual spend on the IHG card with the 5x bonus offer. Not anymore; back in the drawer it goes.
I suspect this will level off after a while. There is a lot of pent up travel demand and hotels and airlines are hurting for cash. The last thing they want are points stays right now.
That being said, I’m glad I previously booked two stays with certs at the IC San Diego. 40,000 is great for that hotel which is currently at 62,000 for the same dates.
I think it’s safe to say it will be hard to find value or a hotel with the free certificates moving forward especially in a popular area or on a weekend. Fort Walton Beach jumped from 20k to 80k and is 60k on a Monday in late September. I also have lots of points, 5 certs (2 player), the old card and the Premier card but I’m only keeping that for the cell phone insurance.
I will be downgrading to Traveler card this year to keep the 4th night free with lower tier insurance and keep my old card until I run out of points for the rebate.
I think we have a new record for a HIX:
Holiday Inn Express : Monterey-Cannery Row
July 1 – 31,000 Points
July 2 & 3 – 80,000 Points!!!
The most frustrating thing about this is the points value per night makes absolutely zero sense when you look at cash rates. Had a one-night HIX stay already booked on points for a friend’s vow renewal (just did a backyard wedding last year for immediate family but had venue prepaid already) in middle of nowhere OH. 16k points for the Saturday night, 34k for the Friday night I was looking to add on. Cash rates are the exact same both nights. I swear IHG just wants to off the whole rewards programme with how low they’re going with it.
From here on, is it safe to say the IHG Premier is no longer worth a 5/24 slot?
I haven’t thought it was worth a 5/24 slot since the 5/24 rule was introduced. I recognize that there are some people who spend a lot of someone else’s money on IHG hotels and get their hotel bills reimbursed, so it probably makes sense for some folks — but my general feeling on the IHG Premier has long been that it isn’t worth a 5/24 slot to me.
I recently got the IHG card, and I’d say it was definitely worth the 5/24 slot. This card had no annual fee first year, 140k points, and a $50 statement credit, not to mention the free night certificate that you can get after a year at no cost (or very little cost here in MA). This is the dream Chase card. If it’s not for something like this, what Chase card are you saving your 5/24 slots for?
What is it with you travel bloggers and always feeling the need to say, “…None of this is particularly surprising…” or some variation thereof?? When you wake up and your points are worth 30% less than they were yesterday, that’s the very definition of a surprise.
A better question is: Why are these bloggers not relentlessly barraging IHG headquarters with pointed questions and “requests for comment”?? I haven’t seen that mentioned in an article on any site yet.
If you can’t tell yet, yes, this one affects me directly. I switched to IHG in 2020 for my business travel because of their credit card bonus and the constant promotions and racked up Spire Elite in the process. I have 400,000 points that I was just waiting for the pandemic’s end to burn and get off the books. Now, all of a sudden they’re worth 30% less overnight. Not cool!
Having followed FrequentMiler for a while now, I’d say they were always pretty chilly on IHG’s loyalty program without explicitly coming out and saying it. I’d agree with their stance as umbrella statements rarely cover everyone’s case, it might work for some people and I’m sure some people will continue to find the exception to the rule. I don’t think it’s sound advice to tell their readers to never consider a program without knowing the circumstances.
Also, I think you assume travel bloggers have a lot more pull than they really do. I’d say the ones that do have a deeper relationship with the company rely on those relationships and tend to come up with absurdly pro-company takes.
I’d also think Spire Elites that racked up 400k points in a pandemic year would be heard louder than a blogger that’s trying to teach everyone to get outsized value from a program. Definitely sucks what they are doing and as a paying customer, I’d at least want to make my displeasure known.
Oh, I will definitely be contacting them personally as well, but as the purpose of travel blogs go, bad press is still bad press. Big companies don’t tend to like being barraged with bad press. A devaluation this big is likely to get picked up by more than the points & miles blogs, I would think.
Thanks Peter for more or less hitting the nail on the head with a number of your points. Back to that in a second.
@Jeremy: First, devaluations stink. No argument from me on that.
In terms of surprise, obviously nobody knew yesterday that things would change like this today. However, since dynamic pricing began a year ago I’ve been saying that it was inevitably going to be a huge devaluation of IHG’s points. When I say that it is not surprising, I don’t mean that it’s not bad. I mean that once they went dynamic, I don’t think anyone who has followed loyalty programs expected that to have anything other that a net negative effect and it was widely expected that when travel got back to something resembling normal that dynamic pricing would lead to precisely these types of wide swings and generally poorer value. It’s like if you raised your fist and said you were going to punch me. If you went ahead and broke my nose, it would obviously be bad but most certainly not a surprise.
In terms of barraging IHG’s headquarters with requests for comment, a couple of thoughts there. First, I don’t have contact information for anyone from IHG corporate. Second, I know that a press team would spout some garbage about how they are working to increase value for customers by making it possible to use your points where you want and when you want even if demand is high and try to spin it into some type of positive change that customers want. I don’t see much value to our readers in giving their marketing team’s spin any air time. Third, As Peter points out, I think that IHG more highly values the priorities of the thousands of franchisees that pay them and those franchisees in turn more highly value the paying customers who come through their door than they do my opinion about their program. If IHG cared about what points and miles bloggers have to say, the program would be very different than it is today as I’ve not noticed much sincere enthusiasm for IHG from any reliable points and miles blog in the past many years.
That’s not to say that the program is worthless. As Peter points out, I’ve long been chilly on IHG and Greg hasn’t ever been much more enthusiastic. We’ve each kept the old (and no longer available) IHG select cards, which with their $49 annual fees and what used to be an uncapped free night have long been a no-brainer (and even with today’s 40K capped certs are still worth forty-nine bucks each year). The program itself doesn’t excite me because all they really offer in terms of benefits are more points on paid stays. Unlike competing programs, there are no breakfast benefits, no lounge access, no confirmable suite upgrades, no program terms that dictate suites even for top-tier members, no major benefit guarantees….basically nothing other than more points. That isn’t exciting to me, so I’ve never been enthusiastic about it. However, as Peter notes, I recognize that the program *does* work for some people. For example, a good friend of mine used to have a traveling sales job where they capped the per diem reimbursement at a level where IHG would always fit and other chains sometimes wouldn’t. Since IHG is everywhere he needed to be and everywhere he was interested in going on vacation and since his employer was footing the bill (and buying his breakfast), IHG fit his needs well. For years before I got into this world of miles and points, I never ate breakfast at my hotel and long had the perspective that if I was spending enough time in my hotel room for it to matter I wasn’t maximizing my trip — so things like suites and lounge access may not have mattered to me even if I knew how to get them, in which case an IHG hotel was a good as any to me. My point here is that there are reasons why someone might choose IHG. They do have some nice luxury brands these days and their footprint is very large. It’s not for me, but it likely is for some folks.
And that’s the perspective I’ve long had on the credit cards. I thought the $49 card was too easy of a win to turn it down — in any year of my life other than 2020 and 2021, I know I’ll spend at least one night near an airport or along a highway that would ordinarily cost me more than $49 where I’ll be able to use a free night cert. At $89, I’ve been less enthusiastic about it because of the chance that it may only save me $10 or $20 and it probably isn’t worth it to me to prepay for a certificate that expires if I think there is a decent chance that it won’t save me more than that. But when they offer 140K points, that has been enough for about $700 in hotel stays (perhaps a bit less now). Compared to the required spend, that’s still a more-than-reasonable bonus amount (even after devaluation). It’s not something I would have prioritized at any point since the $89 card debuted, but it fits in the right scenario (and yours was obviously one of those “right scenarios”).
I’d obviously share your level of frustration if I were sitting on 400K points and waiting for the chance to use them. None of what I said above is to diminish that. As I said in the post, the devaluation here stinks. There is always a gamble in collecting currencies tied to individual loyalty program and it stings when that gamble doesn’t pay off as is the case for someone any time there is a devaluation. I’d be unhappy in your shoes also. Hopefully this means there won’t be another major devaluation for some time. The trick now will be hunting for the opportunities where Greg was finding nearly 1c per point (I’m sure we’ll here more from him on that soon). There are still some values out there.
Nice and thoughtful response, Nick. I disagree on contacting corp to at minimum rule out a tech glitch. I’m not showing my frustration until we can rule out a glitch and I’m writing this as someone sitting on 1M IHG points.
Does IHG honor an existing points reservation at the old price if made before the devaluation? The Intercontinental we booked for two nights in September just went from 55,000 to 85,000 points per night!
Yes, just like with a paid rate they honor the rate you agreed to when you reserved.
And that seals the deal for me. The IHG premier is getting chopped this year. Oh well.
I read an article not too long ago that tries to explain IHG pricing. The author was saying that the award price is not based on the cash price of the room but rather on the probability that the hotel will sell out on that date, thus costing IHG more money for the reimbursement. From one day to the next the price may jump wildly as IHG revises its guess on whether the hotel will sell out. I cannot find this article now, but I’m sure someone else can do a better job with that.
_IF_ the author is correct then that would be a very logical way to price award nights.
However, the examples we’ve been seeing are all over the place. A hotel that is 13,000 points on Sunday, 33,000 on Monday, 14,000 on Tuesday and 33,000 on Wednesday, when the cash price is $119 all 4 nights? No way that accurately reflects the chance of the hotel selling out. If that is really what IHG is shooting for, then they need to immediately scrap this and have their computer experts start all over from scratch.
It may have been this flyertalk post:
https://www.flyertalk.com/forum/intercontinental-hotels-ihg-rewards-intercontinental-ambassador/2018620-deep-redemption-discounts-some-locations-dynamic-award-pricing-10.html#post32680044
but I vaguely remember the author was saying that he knows that it’s done this way, rather than this poster who is trying to guess.
Holiday inn express I was eying just went from 30,000 to 60,000.
Before tossing out your IHG points, note that not all awards are devalued. I just looked at a few properties and saw close to 1 cent per point value at two out of 3 (the third was 0.71 cents per point). I plan to do a more extensive analysis soon.
After digging deeper, I believe now that IHG is simply using a random number generator to price award nights.
My December/February reservations didn’t increase in price. In fact, my December one decreased from 12,500 to 11,000, so I went ahead and rebooked that one. In what you were seeing, did it seem to be a seasonal impact (i.e. summer and fall value was just cut in half?). Our August NC Nags Head trip on 5 certs had a huge increase from around 30K/night to 60K/night.
More the reason to suspect a tech glitchen then, no?! Have you reached out to IHG to comment?
I don’t believe that anyone is talking about trashing their IHG points, although this arc of events certainly supports the “earn and burn” philosophy. The question for you, dear professor, is should the casual player (1) spend a 5/24 slot on an IHG card; and (2) is the IHG card worth holding long term? As for me, if I’m going to take a chance on a random number generator, I’d rather play craps!