Frequent Miler's latest team challenge, Million Mile Madness, is happening now! Follow us as Greg, Nick, and Stephen compete to earn 1 Million SAS miles by flying 15 airlines before November 23rd. Who will complete the challenge with the most Speed, Affordability, and Style?
This morning I published a report about Hilton’s new award program (see: Hilton Honors results are in. Is that Hilton’s middle finger?). In that post I used charts (published with permission from US Credit Card Guide) to support the argument that the new program is much less likely to result in outsized value than the old program. I was wrong.
There’s a great old book titled “How to lie with statistics“. One of the many ways to lie with statistics is to present charts showing different scales in order to make some numbers look bigger than others even if they’re the same. I didn’t do it on purpose, but I certainly should have known better. After all, I’ve read the book (but, in my defense, it has been about 25 years…).
For example, I presented this with max value 30 percent:
And this with max value of 60 percent:
When comparing the two graphs, it sure looks like the chance of getting outsized value from your points has gone down dramatically. And that’s what I claimed in my prior post. But a few readers correctly pointed out that the numbers don’t support that claim. It was the movement of values from .3 to .4 that pushed that “middle finger” up to over 50%.
From US Credit Card Guide’s post we know that the old and new values for the 0.7+ category are 8.796% and 6.496%, respectively. That’s a drop of only 2.25 percentage points. In other words, the chance of getting outsized value has gone down, but only by a smidgen.
The more important point, which I previously glossed over, is that the chance of getting very poor value has dropped quite a bit! In the old program it looks like nearly 45% of the time you would get less than .4 cents per point value. In the new program, it looks like you’ll do that poorly only about 20% of the time. That’s a huge advantage of the new program over the old!
I may have erred with respect to Cash + Points as well. The old Cash + Points rates were only available for a small subset of properties and dates. The new system allows Cash + Points pretty much all the time. If you can book a hotel with points, then you can use points + cash if you prefer. So, the fact that in the old system you could get outsized value over 25% of the time should not be compared to the new system. The denominators are drastically different. That doesn’t mean that things haven’t gotten worse for Cash + Points bookings. It just means that we don’t have the data to make a fair comparison.
Thanks to Mike and farnorthtrader for pointing out my mistake!
Want to learn more about miles and points? Subscribe to email updates or check out our podcast on your favorite podcast platform.
[…] I just didn’t get excited about the idea of cashing out Hilton points at 0.5c each. Sure, the median value of Hilton points is only around 0.45c each, but the whole point in collecting a variety of types of points is so that you can cherry pick the […]
[…] Hilton Honors points. Even with the increased rate, this bonus is probably not a great value. As Greg has pointed out, Hilton Honors points are almost a fixed $0.004 in value per point — meaning that even after […]
[…] Honors card offers a decent return on bonus categories for a card with no annual fee. As per Greg’s recent analysis, Hilton points are typically worth about .4 cents per point towards the cost of a hotel room […]
[…] New Hilton Honors is better for many. Maybe that wasn’t a middle finger after all… […]
We will be switching from Hilton when we can as we have found using points to be so high and we never can find a hotel where we need to go. My husband has stayed in a Hilton 15 nights a month for 3 years.
The points used to be worth between 0.6 and 0.7 cents, because it was easy to get that much or more value from them. Now the points are worth 0.4 – 0.5 cents; while it’s still possible to get more value, it’s not as easy, and the 0.8 cents that was typically available from being able to get a night that would usually be $109 or 20,000 points for $40 plus 8000 points is no longer ever available.
At 0.4 cents, it’s not even worth using them for rooms. Swap 20,000 points ($80 worth) for 3000 Amtrak points ($85 worth). Sad when an exchange that used to be laughable becomes the best use of the points.
Slightly off topic, but with the elimination of award chart, what does it mean for booking all inclusive resorts with Hilton points? For the properties I’ve checked, it seems that all inclusive resorts are no longer bookable with points as it only allows me to book the room. Online chat rep also confirmed this DP.
I used to love Hilton points for the simple fact that you don’t have to be an elite to be able to book premium suites with points. (Even though I am a Hilton Diamond) When I travel for work, of course I pay with cash and earn the points at Hampton Inns and Doubletrees. Then when it’s time to redeem, I travel with the family to vacation spots/resorts and enjoy those hard earned points. There are hotels where you earn the points and there are hotels where you redeem them.
With the Honors change, the Premium rooms (which is just about everything that is not the bottom of the barrel basic room with the garden view) cost with points have sky rocketed. Of the 5 resorts that I have been tracking, I cannot get anything better than .27 cents per point for redemption in the premium room. Hilton Waikoloa, HIlton Aruba, Waldorf Astoria Biltmore and others.
Yes, you can get .4 to .5 out of Standard room with the city view with one bed, if you want anything else with even a partial ocean view, it’s .27 cpp. To me that’s a devaluation. Your travel plans may vary, but Hilton no longer works for me. After I burn the 850k Hilton points I have, i’m done with them.
If you consider 0.4-0.5 cpp “good” value, then virtually everybody and their mother can now get good value.
If you were someone in the past who took the time and made the effort to redeem points for 0.8-1.0-1.5+cpp, then you’re not happy with the new changes.
The only remaining way to get “outized value” is if you redeem points for Cat 1 or Cat 2 properties.
Of course there are still a few diehards who will say they’re getting $1000 rooms in the Maldives for “only” 95k points per night ( > 1cpp), but the fact is hilton points are basically a fixed price currency at this point. Sad!
Right on. For points opportunists, the reduction in poor redemption does not matter. My poor value redemption is 0 because I never redeem points when it is below .5 cent per point. All I care is when I can get outsized value, and now that door is almost shut with the new system. This is definitely a DEVALUATION.
Sorry Allen, but the data doesn’t support your conclusion. If your threshold for a “good” redemption is 0.5 cents, then, for all points redemptions, your chance at a good redemption has only dropped from 31% to 29%. This has clearly not “shut the door” for you to redeem.
For someone like Tim, whose threshold for a “good” redemption is more like 0.8 cents, the effect has been more dramatic. Before there were roughly 1 in 20 (5%) all points redemptions that met his criteria, now it is more like 1 in 30 (3.3%).
For the most part we do look for .8-1 redemption value. as others have pointed out, the hotel categories are also key here. Now the outsized value pretty much limited to cat 1 or 2 hotels. Please name one decent hotel in desired vacation destinations in us that show 0.8-1 redemption value. Before the change I booked a Hampton inn (30k) and diploma hotel (20k+$85) in Fort Lauderdale for before and after cruise stays. Both are going for $300 for the dates I was looking. I’m happy to be corrected but those kinds of value does seem to exist anymore.
Thanks for clarifying. I think you were right yesterday – and today:
Yes, the new program is better for casual users, as they are less likely to waste their points on a very bad redemption and more likely to at least get decent value. And it’s easier to do, too.
And, yes, the program is worse for points fan willing to hunt for great deals. I regularly looked for great cash &points deals, and often there were non, but sometimes they were great. That allowed me to get great value from Honors – and I used cash or another program when they were not available.
Even the small percentage difference has a big impact over thousands of hotels with close to a million rooms….
So, a millions of casual HH members stand to gain, the smaller number of points fans stands to loose…
The Hilton Hawaiian Village went from 200,000 points for 5 nights to 240,000 points for 5 nights.
had old reservation for hilton seville in spain – 20K a night with 5 nights/gold = 80K points under old system during peak summer travel. went back to check new system it’s now 69K points for 5 nights…also checked two other reservations – one stayed same 5K for turkey , and another dropped from 95K a night for thailand . so far 2/3 are better results and 1/3 stayed same.
Key issue – the site that created the “stats” isn’t nearly as experienced and well versed in redemption as you and others on BA are.
Use a source like Ric Garrido.
Spreadsheet mentality misses the conclusions that only experience provide.
I read somewhere that the price in points wasn’t increasing. I’ve been planning a Bali trip for this summer and the Hilton Garden Inn Bali Ngurah Rai Airport was a Category 1 hotel costing only 5,000 points. Now its at 14,000 🙁
This does seem to be an issue at this hotel. I would definitely be contacting Hilton about this as it seems to have changed it’s maximum, contrary to what they advertised.
This isn’t unique… several of the hotels around Columbus, Ohio, were going for 20k/night the week before the switch… now they are 30k. I have a 5 night stay I booked before the change at 16k/night (including 5th night free)… now it is going for 24k/night (including the 5th night free). I am glad others are finding enhanced value from the switch, but I haven’t been so lucky. As a consequence, our upcoming trips are a mix of IHG and Hyatt stays instead of Hilton. Our loyalty to Hilton, at least temporary, is on hold.
@Michael, your issue is different. In your case, these hotels were already 20,000 to 30,000 points, they were just pricing at the bottom of their range. Now they have moved to the top of the range, but they are still not exceeding their previous cap.
I have taken a closer look at this hotel. They appear to be setting all of their rooms as premium rooms except their handicap accessible rooms, which are still at the old rate. All of the prices you are seeing now are premium awards. Not sure if they are actually playing games with their room classifications or if they sold off all standard rooms to consolidators or some other contract, but if you are comfortable with it, you can still book your holiday in an accessible room for the standard points.
I really should finish doing research before I send my reply. If you look way out (I checked next February) or very soon (like tonight) then there are standard rooms, so my guess is that they have actually contracted out the standard rooms for most of the rest of the year and as the consolidator turns rooms back in, they will come available for the standard point price, so if I were you, I would take the accessible room right now and then, when it is close to your dates (like arrival date), see if you can switch it to a regular room.
@ farnorthtrader Been so busy that I just finally checked all of the comments and thank you so much for the help! I will book it right away, you’re awesome!
True but you could have paid cash before when a low value and points when a high value, so there was more opportunity. That’s how most in the points game would see it. For those who want to use points on “any” redemption, then yes, it now is more fair – but fewer “good” redemptions now. I think your first post got it.
Yes but the first post said multiple times that the chance of outsized value was now much lower. The numbers don’t support that.