The largest expert travel community:
  • 741,537 Total members
  • 10,443 Users online now
  • 1,682,997 Threads
  • 30,377,449 Posts
Hotels

IHG’s Variable Point Pricing “Designed to Increase Member Engagement”

IHG’s Variable Point Pricing “Designed to Increase Member Engagement”
Jeff Edwards

In it’s just released “Preliminary Results” report for 2018, IHG CEO Keith Barr revealed that the hospitality group is testing a “variable point pricing” scheme for IHG Rewards Club members. The new policy is set to launch worldwide beginning later this year. According to the company, the move is a means “to build stronger and deeper relationships with our guests.”

There may be big changes in store for IHG Rewards Club members starting this year. Company officials confirm that the hospitality giant will roll out a “variable point pricing” redemption scheme by the end of the calendar year. Details of the new policy have not yet been released, but the hotel conglomerate says the policy change is already being tested and will launch in the coming months.

In its 2018 Preliminary Results Report released on Tuesday, IHG says the move towards a more dynamic rewards redemption schedule is “designed to increase member engagement.” The variable point pricing feature is said to be just one among several next steps in an overall upgrade of the company’s guest reservation system (GRS).

“We have successfully implemented a more efficient and agile organizational structure whilst building resources and capabilities focused on the most attractive growth opportunities,” IHG CEO Keith Barr told stakeholders in the annual earnings report. “We also further strengthened our owner proposition and revenue delivery enterprise, with the successful global roll-out of IHG Concerto, featuring our innovative new Guest Reservation System. This gives IHG the most sophisticated, cloud-based platform in the industry, with further enhancements set to be deployed in 2019.”

Loyalty members are understandably leery when the word “enhancement” is bandied about by a hotel or airline executive. In this case, however, it appears IHG leadership might actually understand the importance of its loyalty program. The report notes that Rewards Club members are seven times more likely to book direct (saving the company substantial third party booking fees) and thereby deliver a 25 percent stay premium.

It is possible the upcoming redemption changes will allow members access to steep discounts on unsold rooms. IHG’s recent acquisitions of new luxury brands, including Six Senses Hotels Resorts Spas might have also necessitated the move to a more agile loyalty redemption system as well.

On the other hand, some of IHG’s already implemented Concerto “enhancements” haven’t exactly been loyalty member friendly. The hotel group describes the latest improvements to the reservation system as giving “guests the opportunity to customize their stay based on features they find important – made possible by new ways of classifying and selling room inventory.”

In practice, the new reservations feature simply monetizes previously complimentary considerations provided at properties. Guests are indeed now allowed to customize their stay, but only by paying a series of ancillary fees. Everything from requesting a room on a high floor to asking for accommodations away from the elevator or ice machine now comes with a conveniently predetermined price tag.

To join the FlyerTalk on the topic, head here.

[Image Source: Wikimedia/ missbossy]

View Comments (2)

2 Comments

  1. downinit

    February 22, 2019 at 7:54 am

    They have already jacked up the reward price on all but the most loathsome suburban and small town properties. Hopefully, this is an indicator that they realize that people are not quite as inclined to book an aging HI/CP for 50k+ as they had hoped. Unfortunately, none of their moves in the last 5 years have been for the benefit of the consumer, so I seriously they will stop screwing us over now.

  2. Cat Man Do

    February 22, 2019 at 1:08 pm

    That usually is code for “We’re raising prices”.

You must be logged in on the FORUM to post a comment Login

Leave a Reply

Hotels

More in Hotels

Should You Really Be Tipping $10/Day in Hotels?

Woaria RashidMarch 21, 2019

Why There May Be A Sex Offender in Your Budget Hotel

Jackie ReddyMarch 17, 2019

Equinox Fitness Set to Launch Hotel This Summer in NYC

Jeff EdwardsMarch 15, 2019

Copyright © 2014 Top News Theme. Theme by MVP Themes, powered by Wordpress.