Originally Posted by
GUWonder
Peak/multi-tier pricing for award nights being used to reduce the outstanding loyalty program points balance for Hyatt is very much tied to Hyatt being “eager to cut its costs for payouts to the hotels for awards stays”. It's inseparably tied -- not more about, not less about. And quarterly figures matter, even for purely internal purposes.
None of what was said in the prior post -- or by Gary Leff about hotels -- is news to me. I said what I said because I am very familiar with the arrangements for award night reimbursements Hyatt and other hotel companies in the industry have.
And I redeemed beaucoup points during the summer redemption promo, even made multiple suggestions to use it to redeem suites at the HdL in Paris instead of the stale Park Hyatt if caring about having more room during a Hyatt hotel stay in Paris during that promo.
Peak pricing does not impact how Hyatt pays hotels. So I’m curious how Hyatt being “eager to cut its costs for payouts to the hotels for awards stays” ties to peak pricing. Are you suggesting that this difference in points will stop properties from reaching near full capacity due to reduced redemption rates? If so, I would love to see your evidence of this and will once again ask you for a source.
I also don’t see how this relates to promos in the direction you’re suggesting. If Hyatt’s pure object was to cut costs, they would be better off focusing on increasing breakage (changing expiry) and pushing redemptions to low occupancy properties as noted in “
Part IV, Item 15 "Exhibits and Financial Statement Schedule—Note 3 to the Consolidated Financial Statements” of their most recent 10K https://d18rn0p25nwr6d.cloudfront.ne...5455f79d90.pdf The biggest thing peak pricing enables for Hyatt is a change in their WoH program liability (and therefore the deferred revenue liability). Despite their concrete plans for peak pricing, Hyatt forecasts this liability to continue to grow (proportionate to total top line). Why? Sounds like they’re planning on issuing more points (ie promos) as they devalue existing points just as other programs do. Very rational path forward imo.
Also you said “And having a promotion that encourages award stays before the new award pricing scheme hits would run counter to that corporate objective.” But Hyatt literally did exactly that with the CC award promo.
Who knows if Hyatt will create a q4 promo and what it will look like if it comes out? But it seems weird to me to somehow tie this to peak pricing and cutting the amount paid to the hotel.