What are Wyndham points worth?

11

I’ve been thinking a lot about Wyndham lately.  First, I found what an incredible deal it could be to use Wyndham points to book Vacasa Vacation Rentals.  Then, I finally pulled the trigger and signed up for the Wyndham Earner Business card that I’ve previously raved about.  Next, Capital One improved the Wyndham transfer ratio to 1 to 1. And then Nick used both of those deals to book an amazing (looking) stay.

For years, our Reasonable Redemption Value (RRV) for Wyndham points was 0.70 cents per point.  This was based on data collected in 2017 by a website called Pointimize which stopped operations in 2018.  And so, with data 3 years old, it was far past time to come up with a new RRV.

In order to determine the value of Wyndham points, I collected real-world cash prices and point prices.  As I’ve done previously in analyses of other hotel loyalty programs, I examined 7 major hotel markets in the U.S. (Chicago, Denver, Houston, Los Angeles, Miami, New York City, and Seattle). Within each market, I identified the top 3 TripAdvisor ranked hotels that are bookable with Wyndham points, and I recorded both cash and award prices (standard room awards only) 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 TripAdvisor? The goal wasn’t to find the 3 best Wyndham hotels in each market. Instead, the goal was to find the 3 Wyndham bookable hotels that are most popular.  Which ones are people really likely to book?  Since many people use TripAdvisor to pick hotels, this seems like a good way to identify those hotels.
  • Which paid rates were selected?  I always picked the best refundable paid rate shown on Wyndham’s website, but without applying any discounts like AAA, military, government, etc.  In every case, I selected the Wyndham Rewards Flexible Member Rate.
  • What about point earnings on paid rates? An ideal analysis may include the value of point earnings on paid rates.  For simplicity, this was not considered in this analysis.  This decision has the effect of over-valuing Wyndham points.
  • What about taxes and fees? For simplicity, taxes, resort fees, and other fees are not included in this analysis.  This decision has the effect of under-valuing Wyndham points.
  • Which specific dates did I use?  
    • Weekday: Wednesday September 15th.  In one case I had to switch the next Wednesday in order to find available rooms.  In another case, no cash rates were available past July so I picked Wednesday July 14th.
    • Weekend Day: Friday October 15th.  In one case, no cash rates were available past July so I picked Friday July 16th.
    • Holiday Weekend Day: Friday July 2nd.
  • Why no Vacasa Vacation Rentals? We know that Vacasa Vacation Rentals can offer incredible value for Wyndham points (details here).  However, my bet is that most people will most often spend their points on regular Wyndham hotels, so I think that looking at regular hotels is a better way to estimate point value.

Go Free vs. Go Fast Rewards

Wyndham offers two types of award bookings: “Go Free” and “Go Fast”.  Go Free rewards are where you book a hotel entirely with points.  Wyndham charges either 7.5K, 15K, or 30K per night for Go Free Awards.  Go Fast awards are where you spend either 1.5K, 3K, or 6K to get a discount off the room rate.  Not all properties make Go Fast rewards available.

As you’ll see in the results below, Go Fast awards offer better point value than Go Free awards.  That said, my bet is that most people will use more of their points for Go Free awards and so I decided to base our Reasonable Redemption Value on the Go Free results.

Results: Go Free Awards

May 11th 2021 Analysis
Point Value (Median) 0.82 cents
Point Value (Mean) 0.85 cents
Cash Price (Median) $147
Cash Price (Mean) $160
Point Price (Median) 15,000
Point Price (Mean) 19,286
Percent of Awards Available for 7.5K 0%
Percent of Awards Available for 15K 71%
Percent of Awards Available for 30K 29%

The median observed point value was 0.82 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 0.82 cents or better value from your Wyndham points when booking Go Free awards.

Pick your own RRV May 11th 2021 Analysis
50th Percentile (Median) 0.82 cents
60th Percentile 0.86 cents
70th Percentile 0.98 cents
80th Percentile 1.10 cents
90th Percentile 1.25 cents

When we publish point 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 RRV.  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).

The above guide can be helpful also when considering buying points when they’re on sale.  For example, Wyndham recently offered their points on sale for just under 1 cent each.  If you’re confident that you will pick the 20% best awards with which to use your points, then the chart above suggests that it is reasonable that you’ll get 1.1 cents per point value, or better.  In that case, buying points for around a penny each can make sense.

Results: Go Fast Awards

Reminder: Go Fast Awards are where you spend a fixed amount (usually 3,000 points) in order to save some money off the cash rate.  You still end up paying for most of the hotel stay with cash and you still earn points on those stays.

Go Fast Stats May 11th 2021 Analysis
Point Value (Median) 1.03 cents
Point Value (Mean) 1.11 cents
Percent Availability of Go Fast Awards 67%
Cash Component (Median) $105
Cash Component (Mean) $114
Point Component (Median) 3,000
Point Component (Mean) 3,714

In half of the cases where Go Fast awards were available, points were worth 1.03 cents each, or more.  That may sound exciting until you consider that the average (mean) room rate overall was $160 and the mean cash component of Go Fast Awards was $114.  In other words, on average, we’re looking at less than $50 per night savings when using points.  It’s a good use of points, but there’s no way to use more points to get bigger savings except by switching all the way to a Go Free award.

Pick your own Go Fast Value May 11th 2021 Analysis
50th Percentile (Median) 1.03 cents
60th Percentile 1.19 cents
70th Percentile 1.29 cents
80th Percentile 1.40 cents
90th Percentile 1.72 cents

I included the above table to show how good Wyndham point values can get if you cherry-pick Go Fast awards.

New Reasonable Redemption Value

Our Reasonable Redemption Value (RRV) for Wyndham points was previously set to 0.70 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 Go Free Awards (rather than Go Fast Awards) is a good choice for our RRV…

Reasonable Redemption Value for Wyndham: 0.82 cents per point

Hotel RRV methodology

A number of people have argued that I should include taxes in the hotel rates used for analyses like this one because leaving out taxes means undervaluing points (since free night awards do not incur most taxes).  However, there are many factors besides taxes that are equally important and also, for the sake of simplicity, are not included in my analyses.  My hope is that these factors roughly balance each other out…

Factors that cause us to undervalue points

  • We do not include hotel taxes in our analyses.  Most taxes are charged on paid stays but not award stays.
  • With hotel programs that waive resort fees on award stays (Hilton, Hyatt, Wyndham), we do not include resort fees in our analyses.
  • 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 points earned from paid stays.  These points can be thought of as a rebate on paid stays only.
  • We do not factor in extra points earned on paid stays for those with elite status.
  • 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.

Given the factors listed above, I think that including taxes in our analyses would lead us to over-value points.

Conclusion

Based on the latest analysis, I’ve increased our Wyndham RRV to 0.82 cents per point.  The idea is that you have equal chance of getting that much value or more from your award stays.

For those who cherry-pick the best value awards, I included percentile results so that you can pick your own point valuation for your own purposes.  For example, if you feel confident that you’ll only use Wyndham points for the best 20% of awards, you could use the 80th percentile: 1.10 cents per point for Go Free awards.  This means that 20% of the time, Wyndham points should be worth that much (1.1 cents per point) or more.  Or, if you’re confident that you’ll mostly use Go Fast awards, you can pick from those values instead.

For a complete list of Reasonable Redemption Values (and links to posts like this one), see: Reasonable Redemption Values (RRVs).

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