blackhat_3_6

While the cost of airline miles has certainly gone up I don't think it's as much as stated. It appears to me that Marriott is using the new peak rates to calculate the points needed to price a TP. The difference in points between a cat 5 & 6 is 120k. The only way to get to that number is by using the peak difference of 20k x 6. The same is true of the cat 7 & 8 TP's. The peak difference is 30K x 6 which accounts for the 180k increase. That puts the cost of the miles at 1.5 points per mile.

pinniped

There are a couple ways to look at this.

1 - the glass-half-full way: Total new spend to required to reach a new Cat 4 Travel Package is fairly similar to the old Cat 5 100k TP. Since almost all of us will jump one or two elite status tiers, we'll earn more "new" points. As an LTG moving to LTPP on August 1, I'll go from earning 18.5 pts/$ to 23.5 pts/$, plus some unknown boost in welcome amenities (that maybe will net out to a couple points per dollar). So my path to the Cat 4 100k Package in the new program is still around $13.5k in spend to get a package worth (to me, conservatively) about $3,000. Not too dissimilar.

2 - the glass-half-empty way: in the grand scheme of things, I want more miles and fewer 1-week hotel stays. Dropping from 120k to 100k makes the award slightly less attractive overall. And upgrading my package to higher categories looks like it just got quite a bit more expensive.

An important detail to-be-determined: the TP chart makes no mention of peak vs. non-peak. These rates *look* like they're baking in an assumption of a peak stay. If that holds true, then I'll consider this a minor devaluation that escalates somewhat on the very high end. If that does not hold true - and it's yet another increase in points on top of this to get what Marriott declares "peak" - then it's a pretty big devaluation.

Somewhere else, I read where Marriott will allow hotels to declare up to half of their total dates as "peak" dates. This is concerning, because most hotels in the world do *not* have 6-months of peak season. Most have 2-3 months, and many have less than that. What dates is a random Marriott in Iowa going to declare as "peak"? When the whole peak/non-peak thing is ultimately revealed, I have a feeling there will be a lot of unhappy members. Marriott has historically let hotels define "extreme demand" or "special event" very loosely, whereas Starwood was much more reasonable. (If a SPG hotel was invoking special event rules, you generally knew it was a major regional or world event.) So I'm worried that the "peak" rules will also be way too loose for the hotels.

One thing, however, is clear: any points sitting in your account right now should be leveled-up and redeemed for a Travel Package in July. I would do this regardless of what happens to the certificate post-August-1.

lexdevil

That would definitely explain the weird jump at Category 6, where the peak surcharge increases from 5k to 10k.

I wonder what thy will do for people who want to redeem outside of peak season. Will they refund points? Allow folks to use a lower category certificate?

If all Travel Package certificates must be at peak rates, that is an additional devaluation, unless there is some way to adjust for the off peak and regular rates.

HHonors OUTSIDER

Yes it seems very clear to redeem now is the best plan. It's sad to see while Marriott takes out SPG they give MR a few hits downward while they are at it.

khlay

Worst case, if 1-5 certs convert to "up to 25k" cert and hotels are allowed to declare "peak" for a day or two every week, the the cert will be useless.

coolfish1103

Book your stay before 12/31 (or whenever they decide to implement it in 2019) before peak goes into effect.

lexdevil

This may not be true for everyone, especially depending on what happens to the unattached/floater certificates.

It is certainly true that you should redeem now if you can use a 7 night stay between now and next July, you know your dates, and the room can currently be booked for points.

If, however, there is a chance you cannot use the certificate (because the property does not have availability, you have no time to make the stay, or you do not know your dates), there are a lot of unknowns that may affect the desirability of this redemption.

If, for example, you book a Cat 1-5 certificate and do not attach it to a reservation, and if Marriott converts these certificates to points at the surrender rate they use when you simply cannot use the certificate, the point refund will be minimal. I think it is currently 45k points. If this is correct, a 270k point Cat 1-5 package will net 132k United miles (I'm going to use the Rewards Plus packages for all calculations) for an actual cost of 225k points. That is a cost of a bit over 1.7 MR points per mile. If, however, Marriott credits back the use value of the certificate (150k MR points), the cost of the miles is around .91 MR points per mile. That's a huge difference.

The above scenario is precisely my own situation. My work schedule only allows me to take a family vacation in late July-early August. Because we have family in the UK, we always spend a week in London. That is how I use my Travel Package certificates. I will not be able to book next year's trip until after the new program goes into effect. As a result, any Travel Packages I redeem now will result in unattached/floater certificates. If Marriott uses the 45k point surrender rate for these certificates, I will be spending 1.7 MR points per mile if I redeem now. If, however, I wait to redeem after August, I would pay 570k MR points for a Cat 7 certificate (what I am most likely to use) and 110k United miles. The certificate would be for peak reservations and be worth 420k points. I would get 110k United miles for the additional 150k MR points, which is a cost of just under 1.4 MR points per United mile.

As a result, whether it makes sense to redeem now depends on a few important factors:

1. Can you actually attach and use the certificate in time?
2. If you make a reservation now but need to change dates, will Marriott cancel your certificate or keep it attached to the new dates?
3. At what rate is Marriott refunding points for canceled legacy certificates?
4. Will you use certificates in the new program during peak periods?
5. Will Marriott make any adjustments for new program Travel Package certificates used outside of peak periods?

Marriott could instead convert unattached/floater certificates to new Cat 1-4 certificates, but this seems unlikely, given that the new Travel Package chart strongly implies that the certificates will be at the peak rate, which would be 30k MR points per night, rather than the 25K MR points per night of the current Cat 1-5 certificates. This is, to my mind, the best argument that Marriott is going to cancel unattached/floater certificates and refund some points, rather than converting them to certificates in the new program.

HHonors OUTSIDER

Excellent post but they will not refunding points. If they force a cancel at the current 45,000 points it would be completely unreasonable for the member. If they refund 150,000 points to the member that would be completely unreasonable for MR. They will exchange them for an "equivalent point-based" cat for future use.

lexdevil

I hope that is the case. The 45k point scenario is pretty dire, and those who predict lawsuits are probably correct if this transpires.

Converting legacy Cat 1-5 certificates to new peak period Cat 1-4 certificates would be a 30k point windfall for certificate holders. Not half bad, if they'll let us extend expiration dates in the new program (I really want to avoid a refund at the surrender rate).

If they convert legacy certificates to new ones, I do wonder where the Cat 6 certificates will land. Will they be Cat 1-4s or Cat 5s? At 30k points per night in the current system, it would make sense for them to map to Cat 1-4s, but they did cost 30k more MR points than the Cat 1-5 certificates, so it seems odd that they would map to the same new award.

SimpleManToo

Now that we know what Marriott is rolling out it sure seems that the Marriott Travel Packages are going to cost lots more after August and give you much less. Would it not be wise to transfer the airline miles now to someone but if so what airline for flights to Australia, Spain, Greece? I read that AA rarely has space and that Alaska is a good bet to Australia. 120,000 miles transferred is certainly better than 100,000 miles but what if you add 60,000 SPG Miles to an airline to bump up the airline miles? What Airline then becomes a good deal then to travel on to one of those destinations?

pinniped

I know there have been a bazillion posts on this, but I'm still hoping for the following:

(1) Where old-to-new is a 1:1 conversion, we get a "new" certificate at the new category. A base TP from the old system converts straight to a Cat 4, and if we hang onto it long enough into the future to take advantage of "peak" dates, that's a small gain for the member.
(2) For upgraded certs where old-to-new is not a 1:1 equivalent-value match, I would *think* that Marriott would convert down a half-category and refund a few points. Same theory holds: if the member hangs on to the cert long enough to be affected by "peak", they get a one-time 30k "bonus".

Marriott canceling certificates and punishing members with the "forfeit" rate seems almost out of the question. Am I being naive? I'm not sure even United Airlines would do something that offensive. I mean, that would be in the Hall of Fame of total jerk moves. Whether or not we like every detail of this merger, it does seem like they've tried to keep fair play in mind.

Thus a system where *most* members will get equivalent value, and a few get a 10% (ish) one-time "bonus" in the peak model, seems like the most reasonable outcome.

SanDiego1K

I anticipate this based on some of yesterday's posts by Lurker. I am hopeful that the new certs can be used at SPG properties as well as Marriott. That would be a win. (I don't have an opinion about "peak" date use.)

pinniped

This is already blowing up in a few threads.

My own reaction:
- Increased earnings partly offset the devaluation of a base Cat 4 TP in the new world. Since most of us jump 1 or 2 elite tiers, we'll earn more. For me, it'll be about the same dollar-spend to reach a 100k TP as it is today. If you tend to redeem mid-category, it isn't too awful.
- The devaluation seems steeper as you upgrade the hotel portion of the award. Gets pricey if you're up in the most aspirational hotels, which was a thing I was really looking forward to with all of the top Starwoods coming into play.
- I'm going to clear out my MR/SPG balance and redeem one final TP under old rules in late July. Will likely also attach the cert to a reservation prior to Aug 1, but I don't believe the most doomsday scenario about getting force-canceled at a massive penalty rate.
- I will miss the ability to do 120's instead of 100's. Overall, I want more miles and fewer weeks in hotels. But not the end of the world I guess...

EDIT: This obviously got merged here from another thread, although the post that preceded it appears to be gone.

lexdevil

The 16+% increase in earning will not come close to covering the additional cost when my annual vacation hotel jumps from 45k point per night to 70k. The higher peak surcharge for Cat 6 and above (10k rather than 5k per night) will probably make me consider staying at hotels that are less centrally located. A good quality Cat 5 becomes an even better bargain when the peak rates kick in (because it is now 20k points per night less than a Cat 6, rather than 15k points per night less).

The lower mileage transfer is frustrating, especially for those of us who are not looking for opportunities to spend lots more nights in hotels.


Ultimately, I'm going to have to decide whether I want to hew close to my current redemption strategy by opting for lower category hotels for my annual family vacation, or I am going to have to rethink things and rely less on Marriott for mile transfers. If I do this, I may start making greater use of Chase UR points to purchase premium cabin tickets rather than using miles. I may even switch my Marriott spend from my Marriott or SPG cards to my Chase Sapphire Reserve. That would give me 3 UR points per dollar spent (worth 1.5¢ each) rather than 5-6 MR points per dollar spent (worth around .8¢ each). It's a choice between 4.5¢ cash value and 4-5¢ worth of MR points. Additionally, the UR points would be given on ALL spend, including sales tax. I'd also earn miles for my flights, and I would no longer have to sweat the wait list or book weird itineraries to get seats in Business or First. I'd also avoid being locked in to a particular airline. I'd just wait for a good fare and book it in the cabin I desired using UR points as cash.

pinniped

I ran queries on a bunch of hotels I've redeemed at in the past or plan to in the future. Most were flat, slightly down, or slightly up. I considered Category Creep a rough "neutral" in my assessment, assuming that TP's are able to be redeemed at these levels for "peak" dates.