Marriott has now jettisoned the last remnants of their old award charts by removing top-end award price caps. Stephen collected data before and after the cap was removed and discovered that the results weren’t nearly as bad as feared. Yes, some hotels are sometimes much more expensive, but they’re often less expensive as well. See: Marriott’s 2023 “Devaluation” – Much Better Than Expected.
I took a different approach to analyze the changes. I used the same methodology as I’ve used in the past to calculate the value of hotel points to see if Marriott’s average point value has changed. The quick answer: not really. Point values dipped a tiny bit, but not enough to change our Reasonable Redemption Value. The value of Marriott points, based on our Reasonable Redemption Value methodology, remains at 0.8 cents per point.
Background
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).
Methodology
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.
- 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 Nov 8, 2023
- Weekend: Saturday Nov 11, 2023
- Holiday: Thursday Nov 23, 2023 (Thanksgiving)
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]
Results
Point Value
| Analysis Date: | 4/7/23 | 12/9/22 | 3/30/22 | 2/16/22 | 9/28/21 | 5/17/21 |
|---|---|---|---|---|---|---|
| Point Value (Median) | 0.76 | 0.81 | 0.75 | 0.66 cents | 0.63 | 0.62 |
| Point Value (Mean) | 0.80 | 0.85 | 0.81 | 0.73 cents | 0.66 | 0.67 |
| Cash Price (Median) | $419 | $408 | $303 | $284 | $246 | $246 |
| Cash Price (Mean) | $462 | $464 | $392 | $305 | $303 | $282 |
| Award Price (Median) | 51,500 | 48,500 | 42,000 | 50,000 | 42,500 | 40,000 |
| Award Price (Mean) | 53,244 | 48,444 | 46,761 | 44,203 | 46,212 | 44,802 |
| Minimum Point Value | 0.38 | 0.43 | 0.31 | 0.34 cents | 0.26 | 0.30 |
| Maximum Point Value | 1.65 | 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 latest analysis was 0.76 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 0.76 cents or better value from your Marriott points when booking free night awards.
In my last data collection in December 2022, the median cents per point value was 0.81. Since both the previous median (0.81) and the new (0.76) round to 0.8 cents per point, we’ll keep our Reasonable Redemption Value at 0.8 cents per point.
Pick your own point value
| Analysis Date: | 4/7/23 | 12/9/22 | 3/30/22 | 2/16/22 | 9/28/21 | 5/12/21 |
|---|---|---|---|---|---|---|
| 50th Percentile (Median) | 0.76 | 0.81 | 0.75 | 0.66 cents | 0.63 | 0.62 |
| 60th Percentile | 0.81 | 0.87 | 0.80 | 0.73 cents | 0.66 | 0.66 |
| 70th Percentile | 0.88 | 0.93 | 0.91 | 0.80 cents | 0.73 | 0.77 |
| 80th Percentile | 0.95 | 0.99 | 1.08 | 0.85 cents | 0.83 | 0.81 |
| 90th Percentile | 1.15 | 1.15 | 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: 0.95 cents per point.
To me, this analysis shows that those who cherry-pick good value awards can count on getting around 0.95 cents per point value, or better.
Reasonable Redemption Value: 0.8 Cents Per Point
Our Reasonable Redemption Value (RRV) for Marriott points was previously set to 0.8 cents per point and the new analysis confirms the same. 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.
- Reasonable Redemption Value for Marriott: 0.8 cents per point
- Reasonable Redemption Value for those who cherry pick awards: 0.95 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.
Conclusion
Based on the latest analysis, I’ve kept our Marriott RRV the same as before: 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 0.95 cents per point or better if you cherry-pick good-value awards.
For a complete list of Reasonable Redemption Values (and links to posts like this one), see: Reasonable Redemption Values (RRVs).
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