Hyatt All-Inclusive Resorts In Mexico: Redemption Clarification

On Thursday Hyatt confirmed the Gold Passport redemption rates for Hyatt’s new all-inclusive properties in Mexico:

  • The first property is the Hyatt Ziva Los Cabos, which opens on November 1, 2013. It’s a 600+ room mega resort for families.
  • The Hyatt Zilara Cancun will open shortly thereafter, on November 15, 2013. This will be an adults  (16+) only resort and have about half as many rooms as the Los Cabos property, so will be a bit more exclusive.

The redemption rates seemed reasonable at 20,000 and 25,000 points per night, respectively.

The big question was how much they would charge for additional guests given that it’s an all-inclusive property. Well Hyatt has now officially posted the redemption chart for the two all-inclusive properties in Mexico:

Hyatt

While the rates of 20,000-25,000 points per night for double occupancy seem reasonable, the points required per additional guest seem excessive.

  • So basically if there are two people in a room at the Hyatt Ziva Los Cabos it costs 20,000 points
  • If there are four people in the room it costs 40,000 points
  • At that point you might as well get two rooms, which would cost the same

That doesn’t make any sense.

Furthermore, while kids two and under stay for free, the cost per additional guest beyond that is the same, regardless of whether it’s a three-year old or adult. That doesn’t really seem fair to families.

For example, pulling up a random date at the Hyatt Ziva Los Cabos I see a rate of $329 for two adults:

Hyatt-Ziva-Los-Cabos

Meanwhile for two adults and two children the rate is $461, which isn’t even a 50% premium:

Hyatt-Ziva-Los-Cabos1

Meanwhile when redeeming points you’d be paying a 100% premium for the two children.

Anyway, I realize Hyatt is new to the all-inclusive market, so my hope is that over time they’ll reconsider those redemption rates.

Paid rates at these properties are generally quite reasonable, so unless you’re going over peak season you’re probably best off paying cash.

Comments

  1. Perhaps you should forward your article to someone in marketing at Hyatt. Not everyone is well versed in analyzing point deals. They may not have considered all the issues you point out.

  2. So I guess if kids are coming I would have to choose between pay cash for 1 room or splurge for 2 rooms on points.

  3. Totally agree and very much hope they adjust the rates for kids as it is not consistent with the impact kids have on the cash rate.

  4. This behavior is kind of the norm for all-inclusives. You see it in cruise ships, too. Because you are not going to book an extra room for your two 7-9 y/o kids.

    You end up paying a room premium to be cramped up in the same room, with kids that in no way eat the same amount of food than adults.
    It’s not as expensive for two adults because, adults tend to pay for premium services and beverages, offsetting the cost of the food, etc.

    It’s a profit maker.

  5. @Lucky:

    I agree that cash makes more sense at these resorts. Since 2013 has turned into a year of endless gutting of loyalty programs I was wondering if you’d consider adding some cash focused articles from time to time since it avoids having to worry about these silly points games where nothing adds up and half the value can vanish at a moments notice.

  6. I endured crowded rooms with young kids at premium rates. But it gets more crowded as kids get older. Paying 40,000 points for two rooms (one of them for my two teens) for an all inclusive beach vacation seems like a deal to me.

  7. Over at FT forums, they have an active thread on this topic, and mommypoints and others pointed out the issues with the points pricing, and a Hyatt rep said they would feed it back to HQ. I suspect we will see a new tier eventually, for kids 3-12, and maybe they will break it up into two extra tiers. Hard to say really. Of course, the purpose of the hotels isn’t to attract points redemptions, it’s to attract revenue paying customers. Us points people are often an afterthought, which appears to be the case here.

  8. Look at what happens when you spend cash and do four adults. It more than doubles the price of the room. Obviously not a smart choice. Points can’t plan for every contingency but sometimes they are useful.

  9. @ AdamH — I think that’s because it prices into a premium suite, since the occupancy for a basic room doesn’t allow for four guests.

  10. Hmmm…

    22K points to stay at the Park Hyatt Vendome, that sometimes prices over $1K a night. Or 25K points for Zilara, which you can get for $329.

    Why you and MP find this award pricing “reasonable” is beyond me.

  11. @ Robert Hanson — I think I explained this pretty clearly (and even bolded it):
    “Paid rates at these properties are generally quite reasonable, so unless you’re going over peak season you’re probably best off paying cash.”

    During peak season rates at the Zilara property are $500 per night. I’d say that’s a pretty good redemption at two cents per point, if you want to go to Mexico.

  12. REF “At that point you might as well get two rooms, which would cost the same ”

    Thought you can only book “one” room with points at Hyatt — I guess I am wrong?

  13. @Lucky I saw the last sentence where you said paid would be better off season. But I was responding to this near the top:

    “The redemption rates seemed reasonable at 20,000 and 25,000 points per night, respectively.”

    So overall, the post says the award rates are reasonable, but paid is a better deal off peak. I agree with the second point, but not with the first.

  14. @ Robert Hanson — Let me clarify why they seem reasonable, then. I’m sure you know the Gold Passport business model. If a hotel isn’t full they reimburse them at slightly above the marginal cost, while if the hotel is full they reimburse them at somewhere around the average daily rate.

    What’s the marginal cost of a hotel that isn’t all-inclusive? Very low, given that the only marginal expenses are the cost of electricity and water, as well as the cost to service the room.

    Meanwhile the marginal cost at an all inclusive is considerably higher, so even when the hotel isn’t full I would assume a redemption at this property is costing Gold Passport a lot more than at other properties.

    Make sense? 🙂

  15. @ Kalboz — They’re the rates listed above. If the children are over two they’d have to pay the supplement of 10,000 points per kid per night at the Hyatt Ziva.

  16. @Lucky Well, when you put it that way…

    I didn’t think at all about the business model, just the consumer viewpoint. 3K a night more than the Park Hyatt Vendome to queue up for the buffet and to have “non-premium alcohol” stocked in my room {which I can cheaply buy at the local supermercado) may well make sense to the Hyatt accountants.

    Considering how expensive it is for me to acquire Hyatt points, it doesn’t make sense personally. If I was sitting on a huge stack of Hyatt points, and because of work or family needed to go during peak season, I’d no doubt feel differently about it.

    And of course your “reasonable” comment was based upon Hyatt accounting, not my personal situation. Viewed that way, it does make sense.

  17. @Lucky,
    Q1: all-inclusive includes breakfast and dinner? Anything else?

    Q2: I agreed with Robert Hanson that, considering Hyatt points are much harder to earn than Hlton and Marriott points, I would consider 20K points is already expensive. I earn 10 points + 50% plat bonus + arrival bonus (200pt – 1000pt) per dollar room rate at Marriott and Hilton. Hyatt offers 5X + 30% bonus (15% for plat) only?

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