When is a decrease not a decrease? When it’s an increase.
Being British has endowed me with a decent (some would say indecent) amount of cynicism. So when Marriott announced a huge devaluation in February 2018 that would take effect the following month, it made me wonder if they’d artificially inflated prices temporarily so they could lower them in August 2018 once the Marriott Rewards and Starwood Preferred Guest schemes had been combined.
As it turns out, that’s exactly what they’ve done; here’s how Marriott’s sleight of hand worked.
It’s a trick some stores use. They double the price of a product for a short amount of time, revert it back to its original price and say “Look! Half price!” We think we’re getting a great deal, but it’s simply the same deal we’d have received a week earlier before the price was raised.
Which brings us to Marriott.
When Marriott announced which categories each property would fall into from August 2018, it was marketed as:
Nearly 70 percent of all participating hotels can be redeemed for the same or fewer points. (52 percent of hotels will move to a lower redemption rate and only 31 percent will go higher.)
According to Marriott, more than half their properties would cost fewer points from August, while less than a third of properties would increase in price. That all sounds very reasonable.
Except it’s not true.
Not when you take into account all the changes they made back in March anyway.
Back then, 1,082 properties – almost 20% of the Marriott Rewards portfolio at the time – moved up a category. From August, 67% of those properties will cost either the same or fewer points.
Why would Marriott raise the points required for stays at these hotels, only to lower many of them again just a few months later?
So they can claim an increase is a decrease. An alternative fact if you will.
When Less Is More
Let’s take the TownePlace Suites Dulles Airport as an example. Before March 2018, it was a category 2 property and therefore cost 10,000 points per night.
In March, it increased to a category 3 property which meant you now had to pay 15,000 points per night. However, from August it’ll be going back down to being a category 2 property. Except category 2 hotels will now cost 12,500 points.
So here’s where we are. The TownePlace Suites Dulles Airport cost 10,000 points per night in February and will cost 12,500 points from August. When phrased like that it seems obvious – it’ll cost 2,500 more points to stay at this hotel from August, so points redemptions there have been devalued.
Except Marriott consulted the retailer playbook. By artificially increasing the price to 15,000 points for five months and then decreasing it to 12,500 points, they can now claim you’ll require fewer points at this property.
That’s not the only example of this happening. In fact, there are hundreds of properties that will cost more, but which Marriott can claim cost less due to their category manipulation.
When Less Is The Same
There are other ways they’ve been able to manipulate the data. For this example we’ll use the Marriott Marquis Washington DC. Pre-March 2018, this hotel was a category 7 property and so required 35,000 points per night. In March it increased to category 8 and thus needed 40,000 points for a one night stay.
Fast forward to August and the Marriott Marquis Washington DC will be a category 5 property that costs 35,000 points per night. You’ll therefore have to use exactly the same number of points from August as you did a few months earlier, but Marriott can claim they’ve reduced how many points you need thanks to the temporary increase to 40,000 points.
Once again, there are hundreds of instances where they’ve done this.
When The Same Is More
Here’s a final example for a different scenario. Let’s say you want to stay at the San Jose Marriott. If you’d stayed there back in February, it’d have cost you 30,000 points per night.
The following month it went up a category and subsequently cost 35,000 points. This property will be classed as a category 5 property in August and so will continue costing 35,000 points.
The increased category in March means that Marriott can now claim that this property will cost the same number of points, when in reality it costs more compared to just a few months earlier.
When taking the 1,082 properties where points redemptions increased back in March and comparing them to how many points you’ll require in August, this is what I found:
- 353 will require more points than they did pre-March, but Marriott can claim they cost less due to the increase in March.
- 213 will require the same number of points they did pre-March, but Marriott can claim they cost less due to the increase in March.
- 159 will require more points than they did pre-March, but Marriott can claim they cost the same due to the increase in March.
The Claim Versus The Reality
When announcing the August changes, Marriott claimed the following:
- 52% of properties will cost less
- 17% will cost the same
- 31% will cost more
Those percentages are based on comparing the current points requirements to those that’ll be in effect from August. As you might’ve guessed from the tone of this post, I think a more accurate comparison would be to the points required back in February.
When comparing that way, this is what you end up with:
- 43% of properties will cost less
- 18% will cost the same
- 39% will cost more
Comparing those percentages, you can see why Marriott did what they did. By temporarily inflating (or inflating a few months early) the number of points required at more than 700 properties, they can claim that more than half their properties will cost fewer points, when in reality far less than half are decreasing.
Similarly, they can claim more than two-thirds will cost less or stay the same, whereas it’s less than two-thirds. Meanwhile, they can also claim that less than a third of their properties will require more points, but in reality far more than a third are increasing.
Other Changes Implemented Early
The category changes in March weren’t the only changes they implemented early in order to avoid some backlash in August when Marriott Rewards and Starwood Preferred Guest finally became one.
Back in November, Greg wrote about how Marriott dumped rollover nights and status buy back. By implementing these changes at the start of 2018 rather than in August, they seem to be counting on people not associating the loss of these features with the merger of the two loyalty schemes and help ensure they get positive coverage in August.
Overall, the category changes Marriott’s implementing in August aren’t bad. Even when taking into account the artificial inflation of properties in March, we’re still seeing a larger number of properties requiring fewer points than costing more.
My issue has been with the seemingly disingenuous way that Marriott both implemented and presented these changes. 43% costing less and 39% costing more is a big difference to 52% costing less and 31% costing more – a 4% difference compared to a 21% difference. It’s also a good reminder that everything isn’t always as it seems when it comes to press releases.