In March 2022, Marriott dumped their award charts. Behind the scenes, though, hotel prices were capped to a maximum value that usually wasn’t far above the peak pricing from the good old award chart days. Starting in 2023, that cap will be gone and award prices for the most desirable properties will likely go up beyond any prices we’ve seen before. Boo!
There’s no question in my mind that some of Marriott’s most desirable properties will cost a ridiculous number of points in the near future (more ridiculous than now, that is). But what about regular everyday types of bookings? Will our points be worth less than before? Are opportunities for getting outsized value going away? In this updated post, I’ve tried to answer those questions with a real-world data collection and analysis.
When collecting points and miles, it’s always a good idea to have a general idea of what points are worth. Let’s say, for example, that you have the opportunity to either earn 1,000 Hyatt points or 2,000 Marriott points. Which should you go for? If you don’t know what the points are worth, you’d likely go for the Marriott points. But, in my analyses I’ve found Hyatt points to be worth more than twice as much as Marriott points. Therefore, on average, 1,000 Hyatt points are worth more than 2,000 Marriott points. In this post, you’ll find my best current estimate of the value of Marriott points. To see our estimates across many programs, see this post: Reasonable Redemption Values (RRVs).
In order to determine the value of Marriott points, I collected real-world cash prices and point prices. As I’ve done previously, I examined a number of major hotel markets in the U.S.: Chicago, Denver, Los Angeles, Hawaii, Las Vegas, Miami Beach, New York City, Orlando, and Seattle. Within each market, I identified the first three search results with a guest rating of 4 or better, and I recorded both cash and award prices for three dates each: a weekday, a weekend, and a holiday weekend.
- Why U.S. only? U.S. consumers are known to spend most of their points and miles on domestic travel. Since the majority of this blog’s audience resides in the U.S. we opted for a U.S. centric view of point values.
- Why Guest Ratings? The goal wasn’t to find the 3 best Marriott hotels in each market. Instead, the goal was to find the 3 Marriott bookable hotels that are very popular. Which ones are people really likely to book? By using a combination of Marriott’s default sorting and by picking only well rated hotels, I think it’s reasonable to assume that many members would pick these hotels.
- Which paid rates were selected? I always picked the best fully refundable paid rate shown on Marriott’s website, but without applying any discounts like AAA, military, government, etc. For this analysis, I usually selected Marriott’s Member Flexible Rate.
- Which specific dates did I use?
- Weekday: Wednesday April 12, 2023
- Weekend Day: Friday April 14, 2023
- Holiday Weekend Day: Saturday April 8, 2023 (Easter Weekend)
In order to estimate the value of Marriott points after award caps go away, I did a parallel analysis where I simply removed from my data set all observations where the point price was at the top of the 2022 allowed range. This doesn’t tell us anything about what point prices will be like on the most desirable peak dates, but it gives us some idea of what the value of Marriott points will be during standard and off-peak times.
New Calculation Approach
Starting 12/5/2022 with my Hyatt analysis, I began calculating Cents Per Point (CPP) using new formula. In all past hotel CPP calculations, I didn’t account for taxes and fees or points earned on paid stays. I figured that those things basically cancelled each other out. Going forward, I am including these factors, as well as resort fees, in the CPP calculation. The calculation is based on the following terms:
- Base Cash Rate: This is the hotel room rate before taxes and fees.
- Total Cash Rate: This is the total amount, including taxes and fees, that would be paid if booking a hotel’s cash rate.
- Resort Fee: This is a fee that is imposed by many hotels above and beyond any required taxes. This goes by different names at different hotels: Resort fee, Destination charge, Founders fee, etc.
- Points Per Dollar Earned: The number of points per dollar earned by non-elite members on paid stays. For example, Hyatt members earn 5 points per dollar, Hilton, IHG, and Marriott members earn 10 points per dollar (at most hotels), etc.
- Points Earned on Cash Rate: This is the number of points you would earn if you paid the cash rate. The calculation for this is: (Base Cash Rate) x (Points Per Dollar Earned). For this calculation, our default approach is to assume that the traveler does not have elite status (elite members earn more points per dollar).
- Point Price: The number of points required to book a night at the hotel
- Cents Per Point (CPP): This is the value you get per point when using your points instead of cash to pay for a stay.
Hotel Programs that Waive Resort Fees on Award Stays
Hilton, Hyatt, and Wyndham waive resort fees when you book stays using points or free night certificates. For these chains, the resort fee does not have to be considered separately from the Total Cash Rate (which includes the resort fee). So, the CPP calculation is as follows:
CPP = Total Cash Rate ÷ [Point Price + Points Earned on Cash Rate]
Hotel Programs that Charge Resort Fees on Award Stays
IHG, Marriott, and many other hotel programs impose resort fees on award stays. For these chains, the resort fee must be specifically taken into account in the CPP calculation. We do that by subtracting it out of the Total Cash Rate. The CPP calculation is as follows:
CPP = [Total Cash Rate – Resort Fee] ÷ [Point Price + Points Earned on Cash Rate]
In the following table, there are two columns with the same analysis date: 12/9/22. The one marked “uncapped” uses the same dataset but I took out datapoints where the point price was at the top end of the allowed range for 2022. This gives us an idea of what points may be worth in 2023 during standard and off-peak dates.
|Point Value (Median)||0.81||0.79||0.75||0.66 cents||0.63||0.62|
|Point Value (Mean)||0.85||0.83||0.81||0.73 cents||0.66||0.67|
|Cash Price (Median)||$408||$408||$303||$284||$246||$246|
|Cash Price (Mean)||$464||$464||$392||$305||$303||$282|
|Award Price (Median)||48,500||48,500||42,000||50,000||42,500||40,000|
|Award Price (Mean)||48,444||48,444||46,761||44,203||46,212||44,802|
|Minimum Point Value||0.43||0.43||0.31||0.34 cents||0.26||0.30|
|Maximum Point Value||1.78||1.78||1.71||1.89 cents||1.38||1.67|
* Analyses prior to 12/5/22 relied on pre-tax numbers and didn’t account for points earned on paid stays. For this reason, I grayed out the numbers that can’t be fairly compared to the most recent numbers.
The median observed point value for the regular analysis was 0.81 cents per point. This means that half of the observed results offered equal or better point value and half offered equal or worse value. Another way to think about it is that without trying to cherry pick good awards, you have a 50/50 chance of getting 0.81 cents or better value from your Marriott points when booking free night awards. After eliminating the capped award rates, the median fell only a tiny bit to 0.79.
In my last data collection in March 2022, the median cents per point value was 0.75. Interestingly, the increase to 0.81 appears to be due entirely to the new improved methodology. When I applied the old methodology (which doesn’t account for taxes and fees) to the new dataset, I found the same old median of 0.75 cents per point.
Pick your own point value
|50th Percentile (Median)||0.81||0.79||0.75||0.66 cents||0.63||0.62|
|60th Percentile||0.87||0.83||0.80||0.73 cents||0.66||0.66|
|70th Percentile||0.93||0.89||0.91||0.80 cents||0.73||0.77|
|80th Percentile||0.99||0.96||1.08||0.85 cents||0.83||0.81|
|90th Percentile||1.15||1.12||1.21||1.03||0.98 cents||0.96|
When we publish Reasonable Redemption Values of points (RRVs), we conservatively pick the middle value, or the 50th percentile. The idea is that just by randomly picking hotels to use your points, you have a 50/50 chance of getting this value or better. But what if you cherry-pick awards? Many people prefer to hold onto their points until they find good value uses for them. If that’s you, then you may want to use the table above to pick your own point value. For example, if you think that you’ll hold out for the best 10% value awards, then pick the 90th percentile. If you cherry-pick a bit, but not that much, you might want to use the 70th percentile (for example). I’m guessing that most cherry-pickers will land around the 80th percentile: 0.99 cents per point, or 0.96 cents per points when eliminating capped award prices).
To me, this analysis shows that those who cherry-pick good value awards can count on getting around 0.96 cents per point value, or better.
New Reasonable Redemption Value: 0.8 Cents Per Point
Our Reasonable Redemption Value (RRV) for Marriott points was previously set to 0.75 cents per point. RRV’s are intended to be the point at which it is reasonable to get that much value or better for your points. Therefore, I believe that the median observed value for is a good choice for our RRV. Since the capped and uncapped medians were so close to each other (0.81 and 0.79), I decided to split the difference and pick 0.8 CPP as our new Marriott RRV.
- Reasonable Redemption Value for Marriott: 0.8 cents per point
- Reasonable Redemption Value for those who cherry pick awards: 0.96 cents per point
Overvaluing vs. Undervaluing Points
There is no perfect way to estimate the value of points. Decisions we made here in some ways overvalue points and in some ways undervalue points. The hope is that these things roughly offset each other…
Factors that cause us to undervalue points
- With hotel programs that offer 4th Night Free Awards (IHG, with some credit cards), or 5th Night Free Awards (Hilton & Marriott), or award discounts (Wyndham), we do not consider the point savings in our analyses.
- With hotel programs that offer free parking on award stays to top-tier elites (Hyatt), we do not factor this in.
Factors that cause us to overvalue points
- We do not use discount rates (other than member rates) in our analyses. In real-life, many people book hotels cheaper (and sometimes far cheaper) by using AAA rates, government & military rates, senior rates, etc.
- We do not use hotel promotional rates. Often, individual hotels have deals such as “Stay 2 Nights, Get 1 Night Free” which can greatly reduce the cost of a stay.
- We do not use prepaid rates in our analyses. Sometimes these rates are significantly lower than refundable rates.
- We do not factor in rebates which can be earned from booking hotels through shopping portals.
- We do not factor in extra points earned on paid stays for those with elite status.
- We do not factor in rewards earned from credit card spend at hotels.
- We do not factor in hotel loyalty program promotions: Most promotions, but not all, only offer incentives for paid stays. We often see promos offering bonus points, double or triple points, free night awards, etc.
- With hotel programs that waive resort fees for top tier elites on paid stays (e.g. Hyatt), we do not factor this in.
Based on the latest analysis and improved methodology, I’ve increased our Marriott RRV from 0.75 to 0.8 cents per point. The idea is that you have equal chance of getting that much value or more from your award stays. That doesn’t tell the whole story. The latest percentile results show that it’s reasonable (80th percentile) to expect to get 0.96 cents per point or better if you cherry-pick good-value awards.
My analysis simulating next year’s point values showed that for standard and off-peak travel, you can expect similar value from your Marriott points as you’ll get today. It’s impossible at this point, though, to estimate the value of points during peak dates at popular properties. For those, Marriott will no longer enforce a strict limit to the top end award pricing. As a result, those top end award redemptions may cost a lot more than they do today and that will have a negative effect on those who cherry-pick the best of the best awards.
For a complete list of Reasonable Redemption Values (and links to posts like this one), see: Reasonable Redemption Values (RRVs).