pbd456

Didn't Marriott also have gift card for 20% discount during discover America? I got some in 2017 and still haven't spent them all (and the value is still there). Did Marriott have the same offer for 2018 and 2019 discover America?

escape4

I do not think the comparison hotel vs airline is entirely fair. First of all, with airlines the question is usually between 100 USD cash or 100 USD voucher with an expiration date. Nobody would prefer the voucher. Qatar Airways offers 10% more if you pick a voucher, in that case it starts to look a bit more like hotel gift cards with a discount, some will pick the QR voucher, some will not. It's a more balanced choice. Second, hotel gift cards have no expiration date, unlike airline vouchers (well, maybe not all airlines, but many that I have seen). Third, I am far more likely to fight a cash refund for a local airline if I have cancelled my trip in that part of the world, because I have no idea when I could possibly use that voucher again. I would be less worried about fighting an airline voucher if it's a big airline in my backyard and that I am almost sure to book with them in the future, just like Marriott has hotels everywhere so I will stay at some point and get the 20% value.

Yes the gift cards are non-refundable, but since you can use them at many hotels, it is not nearly the same as a non-refundable reservation at one specific hotel.

fttc

One thing that's certain, you can not predict the future. If you can, you would have better things to do instead of loaning money to Marriott.

So what you are paying is just the market value of what those gift cards are worth right now. Nothing more or less. You are getting a discount for taking on some risk which is a standard economics concept. What if vaccine doesn't pan out and you can't travel for another 4 years? What if you lose your job and can't afford? What if you get into an accident that you can no longer travel? What if Marriott needs more money and sells those gift card for 30% off? Then you just lost 10% of your investment.

Maybe your plan will pan out and I'm sure you will brag about it then. But before the future completely unfolds, you can't claim you have made the right decision. Pretending otherwise is just ignorant.

RedSun

Reasonable points.

We all know that "cash is the king". GC is not cash and there is a huge cost to convert it into cash. For the people who are out of job right now, but have $5k stuck with various GCs, what the options are? People can sell those GCs at eBay or GC Granny etc. The total selling costs will eat right into the 20% discount.

A lot people cash in AmEx MR points at Schwabs at 1.2 cpps. Also a lot people cash in Chase UR at 1.5 cpps. We say this practice is not optimal. But some people do not travel, but need the cash now. So these are the best for them.

Certainly some people may have a 7-day Ritz Carlton vacation stay this year and this 20% discount certainly helps a lot. But those are rare in current situation.

Personally I'm loaded with points, TPs and FNs with Marriott and other hotel chains. Along with a bunch airline miles, Chase UR, AmEx MR, Citi TY, even BofA Merrill+ points. I also get the AmEx Brilliant and its $300 Marriott credit. So I do not see myself paying any cash for Marriott stays. Three of my trips got cancelled this spring. We are not certain about summer travel, fall and winter holiday etc. Also I've been trying to dump my Marriott points and flee the Bonv*y. And it has not been easy even with the jacked up point redemption. I ended up with transferring half of my Marriott points out when there was the point transfer bonus last time. I wish the bonus program comes back again and I could transfer the remaining points out to airlines.

I'll consider this 20% discount if Marriott is not Bonv*y'd any longer. And the future is clear with Marriott.

escape4

You seem to discard the scenario of selling those cards, should you not be able or willing to travel for whatever reason. That is part of what supports its market value.

If the discount goes to 30% then yes you lost 10% on your "investment" but all the folks who will stay at Marriott hotels after having declined to buy gift cards will be 30% poorer not 10% poorer

escape4

If you do not expect paying for Marriott stay for the foreseeable future because you are flush with points, then I agree the discount would have to be far greater than 20% for you to pull the trigger. Also folks who are tight on money should think twice about buying indeed because they could end up being in a "forced sale" situation on ebay and they might not recover all their money. This gift card promo is mostly for people who have a very high chance of spending that money on Marriott hotels because that money is available and because they will want to or have to travel. So for those people, might as well spend it now and earn 20% return, rather than spend later and wish we had bought the gift cards.

If you think next time you spend at Marriott is in three years then this is looking more like 6% return per year, nothing particularly interesting. This works better for people who will spend very soon.

RedSun

This is correct.

The other main factor is that Marriott Bonv*y is a decaying program. It keeps losing value ever since the 2018 SPG merger. So I'm reluctant to invest more into Marriott. Marriott point used to be worth 0.9 cpp before. But with the introduction of the Cat-8 (85k 70k/100k), the point value is at 0.5-0.65 cpp. The only positive change is the total 30 FN each year on the two credit cards.

It is always true, if the deal is too good to be true, then it is not that good. Marriott would not be in the business to lose money by selling those GCs.

falcon9xr

Received my gift card the next day, if anyone is looking for data points on delivery. Ordered 9:14am, received 11:45am the next day.

fttc

How much can you sell the gift cards today if you have to unload those today? I don't think you are going to make money today unless you find someone uninformed. Now if you expect it sell for higher value in the future, that's no different than buying a stock today and hope it's higher 2 years from now. As I said, you can only take chance, but can't predict the future.

No, that's illogical. It's like saying people paid $1k for auto insurance, but never used it made the bad decision because they are $1k poorer. That's just not right. That's the risk premium for avoiding the risks. When people don't buy the gift cards, they have choices of other hotels, or even not traveling if situation is not right. Even if they end up staying at Marriott at the end, they are just paying a premium for being certain that their money does not go waste. Yes, they will have paid more in that case. But they have avoided the risk. That's standard economics concept. That's no different than the difference between advanced purchase and refundable rates.

escape4

If you buy a gift card today, you are unlikely to be in position to have to sell the gift card today. However once the Marriott sale is over and travel resumes, that $1000 gift card that sold $800 for, I think there are decent odds that someone will be willing to pay more than $800 for it, regardless if the discount temporarily reaches 30% or not after you buy.

Regarding the second part of my response and your claim that my response is illogical: perhaps it was not clear enough with the smiley , I was not trying to articulate a fool-proof logical argument. I was more trying to show that yours was on shaky grounds when you say I "lost" 10% on my investment if the discount goes to 30%.

If I may compare to the stock market:
Stock market drops 20%, person A buys but B stays on the sidelines, stock market drops another 10%, then rebounds 30% to go back to where it started. Surely if B tells A that he "lost" 10% because he did not buy at the absolute bottom, Mr A would look back in puzzled knowing he is 20% richer while Mr B has not made anything.

escape4

Yes that is another consideration. The lower Marriott is in your pecking order, the less attractive gift cards are. There are some airlines that I dislike so much that I have no interest in flying them anymore, so I will not be interested in their mileage sales. I guess if they sold transferrable gift cards I could buy but my intend would be to sell them to a third party rather than use them myself, but it is more hassle so realistically Marriott gift cards are not meant to be sold although it's an option.

fttc

There are a lot of assumptions and estimations in what you wrote. Even yourself left a lot of wiggle room by using phrase like "decent odds". If what you wrote is guaranteed to happen, then you should spend all your cash and mortgage your house in doing that. Why don't you do that? Because you know there is a risk.

If at a moment in future that it sells for 30% off, then yes, you would have lost 10%, because you can or someone else can buy the same gift card for 10% less. Whether it recovers later is irrelevant and completely separate event. Again, that's standard economics concept.

nomadic.relief

I am a bit perplexed - made a purchase 6am Tuesday on my work card. Got confirmation email right away, took until Wed afternoon to post to the card. Had been waiting to see exchange rate before making a purchase on my personal card. Did that this evening and instantly got a confirmation of purchase, was notified of charge on card, and recieved e-gift card simultaneously.

Still have not seen other e-gift card. Even checked in junk mail (although that's not where the second one appeared).

escape4

Then using your jargon, you lose a lot of money, a lot of times, because many things that we buy in life subsequently go on sale at a price lower than when we bought and then go back to standard price, possibly higher than what we bought.

Whether the price of something recovers is ENTIRELY relevant, that's called the difference between unrealized capital gains and realized capital gains. Standard economics concept What matters the most is the entry point and exit point - the path it takes is of lesser importance.

I have a loss of 10% only if I decide to sell my gift cards at $700-720 after the discount increases to 30% and before Marriott ends the sale. Otherwise, if I successfully use my gift cards in a few months times, I have not lost anything, in fact I have saved 20%, nothing more nothing less.

escape4

I have not seen anybody in this thread talking about guarantees of what will happen or the absence of risk. So if anything that seems to confirm that our opinions of the situation do not differ much after all, even if we choose different actions of buying or not buying because our circumstances are different.