World Of Hyatt May Encourage You To Stay Somewhere Else

Hyatt is scrapping their Gold Passport program in favor of World of Hyatt starting on March 1. The new program has a few changes that you might like, but it’s also chock full of hidden gotchas and devaluations. I’ve been busy practically since the day it was announced and haven’t really had a chance to think about it much until recently.

In fact, it was the “Welcome to Globalist” email that sort of motivated me to write about it. And, given the response in the comments, I’m not the only one who finds this program insanely confusing. I mean, when many of the top miles and points bloggers don’t even know something so simple as the requalification requirements… well, you get the idea.

Anyway, there’s another hidden gotcha in the new program, this time concerning the policies surrounding the free night awards and Diamond Suite Upgrades. Here’s how you might find yourself in the situation where Hyatt’s loyalty program actually encourages you to stay with someone else. Crazy, eh?

world-of-hyatt-1

No more welcome amenity for Globalists

Under the former Gold Passport program, Diamonds have been able to select either a food and beverage amenity or bonus points upon check in. At full service properties, it was 1,000 points, while at limited service Hyatt Places and Hyatt Houses, it was 500. Even better, at least for some of us, you got a 50% bonus if the points didn’t automatically post, which frankly happened fairly often at limited service properties.

Well, under World of Hyatt, there is no more welcome amenity. At all.

Depending on your stay patterns, a 50-night Diamond member will stand to lose maybe 15,000  – 20,000 points per year. That was enough for a Category 3 or 4 night, or multiple nights at lower level properties.

Grand_Hyatt_Cannes_Diamond_Amenity

Those points could also be what pushes a Diamond member over the threshold needed for an aspirational stay or special occasion trip.

Introducing free night awards

The apparent replacement for these bonus points is tier-based free night awards. Now you’ll earn a Category 1-4 free night upon hitting 30 nights in a year, and then a Category 1-7 free night at 60 nights.

In theory, this could be a good thing as the first free night is worth 15,000 points and the second one is worth 30,000 points. So whereas a Diamond may have previously earned 15,000 – 20,000 points per year from the welcome bonus, they’ll now get free nights that might be worth 45,000 points if optimally used.

Sounds good, right?

The problem is that these free night awards will expire a mere 120 days after you earn them. So while you could have banked the points for a future aspirational trip, your free nights will go poof even faster than the annual free night you get for having the Hyatt credit card.

It’s clear that Hyatt is betting on a lot of breakage — that is, awards that expire unused because people forget to, or simply don’t have time to, use them. But they may not have considered the unintended consequences.

How World of Hyatt may encourage you to stay elsewhere

The cardinal rule of loyalty programs is that you should always be incentivized — or at least not disincentivized — to stay with the chain. In a mathematical sense, the value of your benefits should always be monotonically increasing with each incremental stay. That is, the sum value of your loyalty account should not go down after a stay.

That probably seems so obvious. Yet I’m going to lay out a scenario where exactly that happens under World of Hyatt.

Imagine someone has a lot of travel in the first half of the year such that they quickly rack up 58 Hyatt nights by early July. They are obviously only two nights away from earning the Category 1-7 free night. Good for them, right? 

Maybe, maybe not.

For good measure, let’s assume they are also Hilton Gold (isn’t everyone?) so they have good alternative options. And they have plenty of additional business travel coming up.

Now let’s imagine that they are planning a leisure trip to the Park Hyatt Maldives — arguably the most aspirational property in the Hyatt portfolio — for January of next year. With paid bookings going for about $1,000 per night, the free night certificate could have huge value here.

maldives rates

But here’s the rub —

That Category 1 – 7 free night will be deposited as soon as our intrepid Globalist hits 60 nights. And it will only be valid for four months. So if they cross 60 nights in July, it will only be valid until some time in November. Instead of using it at the Park Hyatt Maldives, they may end up burning it on the Hyatt Place Medford. Fun, eh?

Therefore, Globalists have a very real incentive to delay crossing the 60 night threshold until October. During that time, they can easily stay at Hiltons — which of course are everywhere — and they might even get a proper welcome amenity.

That’s revenue that Hyatt will never see. All because of a poorly designed loyalty program that tried to get cute.

Park-Hyatt-Maldives-2

Suite upgrade awards too…

Sadly, this phenomenon isn’t confined to just the tier-based free night awards.

Suite upgrade awards are supposedly going to follow a similar issuance and expiration policy where they’ll be deposited as soon as you earn them and then good for 12-months.

Using the same scenario as above, if our Globalist reaches 60 nights in July, they’ll receive their upgrades which will be good through the following July. But now let’s say that work travel next year slows down such that they don’t get 60 nights — and thus don’t requalify for Globalist — until December. That means their old suite upgrades will have expired in July and they won’t get the new tranche until December. They’ll go about half the year without having any suite upgrade awards in their account.

What if they are planning a family vacation during that time?

Maybe in addition to the Maldives in January they are also eyeing a romp around Asia in the fall. Perhaps a few days at the Grand Hyatt Hong Kong and a few more at the Grand Hyatt Kuala Lumpur, both excellent uses of a suite upgrade award. But to do so, they’re going to need to have some suite upgrade awards that are valid during the fall. Which means waiting to cross the 60-night threshold until later in the year.

Now our Globalist has a slew of reasons to book with Hilton since they’ll delay not only the issuance of their tier-based free night which they plan to use in the Maldives but also their suite upgrade awards which they’ll apply to their stays in Asia.

Grand-Hyatt-Kuala-Lumpur

The United/Continental experience

These perverse incentives aren’t completely unprecedented, however. Around the time of their merger takeover of United, Continental began issuing Systemwide Upgrades to bring their onePass frequent flyer program into alignment with MileagePlus. Whereas United had previously issued SWUs on January 1 with a 12-month validity, Continental started issuing theirs immediately upon passing the 100,000 mile threshold, also with a 12-month validity. 

For some travelers, this created an incentive to book away from Continental such that the deposit and subsequent expiration of the upgrades would be postponed. If you knew, for example, that you wanted to use the upgrades in November of the following year, you wouldn’t want to cross the 100,000 mile threshold in September. 

So you would fly American. Or really anyone else.

united-lounge-london-heathrow-62

This ridiculousness was quickly rectified such that the upgrades were deposited immediately, and then valid for the entire following year. That meant the upgrades could be deposited in September of one year, and still be valid for use in December of the following year.

This harmonization was actually the best of both worlds — I can’t believe I just said that — and it’s the system that is still in place at United today.

The new scheme actually encourages you to fly 100,000 miles as fast as you can. Which is exactly what a loyalty program should do.

Bottom line

The ridiculous expiration policy of the tier-based Hyatt free nights and suite upgrade awards may create the very real possibility of a guest being rewarded for booking away from the Hyatt brand. And if they do, that is revenue that Hyatt will never see. It’s gone forever.

The question is, will this lost revenue be more or less than the savings they’ll achieve from the breakage or sub-optimal use of these awards? I guess Hyatt is betting on less.

Sure, we can debate how many members of the traveling public will actually go to these efforts to maximize the value of their rewards, but the point remains — loyalty programs should never provide an incentive to book away from the brand.

About Travis

Travis has been playing in the world of miles and points for over a decade. At one time or another he has held status on just about every major domestic airline and hotel program. He has visited all 50 US states and over 50 countries. Nowadays he travels almost exclusively with his wife and three young children.

More articles by Travis »

Comments

  1. Well said. We’ll see if Hyatt listens.

    Perhaps they are counting on most people not having planned trips far enough in advance to think of this, which is probably true for many travelers, but certainly not all, and especially not around major trips (like planning a honeymoon, for example).

  2. Two months into the year, road warrior with over 25 nights YTD and only 2 nights with Hyatt so far this year. Last year they were my go to and I was a Diamond by the end of Q1. They’ve certainly turned me to other brands. Bad customer service, DSUs expiring, competing info from GP agents, and the new World of Hyatt as the last straw. A shame.

  3. You are likely vastly overestimating the number of people who this applies to – even most of your readers are not going to the Park Hyatt Maldives in January followed by a romp around Asia in September (or any other type of trip). Same thing applies (except to an infinitesimal level) of all Hyatt customers. Also, this all presupposes that (a significant number of) people choose their choice of hotel chain based on welcome amenity.

  4. Do you think there will be changes to the Hyatt credit card? Would it be a good idea to apply for it now? I’ve been wanting this card for a little while now and just have yet to apply.

  5. Yeah, I was thinking about this very thing. I think my plan is simply to focus on Starwood instead this year but I also may just put enough spend on the Ritz card that I can look at other hotels.

    You need to watch not only nights but also dollars. I think the only people that really need to be worried are business travelers who stay in San Francisco, etc. But once I get close to 50k base points, which is likely to be earlier than I get to 30 nights, I will need to stop and not stay at Hyatt until I’m sure I can use the cat 1-4 in the next year. I actually find the cat 1-4s not that easy to use that I get on the credit card and I find that I’m frequently scrambling coming toward the expiration date. I have no hope of Globalist, but I probably can make Explorist on base dollars.

    I’m not sure I would really not stay at a Hyatt once I’m close if it’s otherwise convenient, if I didn’t have an anticipated use of the 1-4 cert, but it’s certainly something I’d have to think about, especially if I don’t want to do the spend on the Ritz card and need to have some starwood stays.

    Is it a big problem for Hyatt? I don’t know, I doubt it. But the fact that they’ve set up a program that makes a $9800 spender have to think twice before staying at a Hyatt is kind of indicative of the level of thought that went into this program and their seeming desire to want to fix problems that don’t exist.

  6. I’ve been a Diamond for a few years and I will say that I usually thoroughly enjoy Hyatt Gold Passport. The amenity I value most is free breakfast and club level access. Given Hyatt’s limited footprint, I know I will never be able to hit 60 nights this year so my strategy is to book Starwood (platinum) and use my new Hilton Diamond match to try a new brand. Perhaps this was a good move by Hilton?

    Adios Gold Passport! It was nice while it lasted!

  7. Terrible program, awful branding/logo – and non-responsive management. I have yet to see a positive review of the new program. That tells me all I need to know.

  8. I went out of ny way to stay at Hyatt properties to qualify for diamond through 2018. Not this year. I’m not spending my $ on Hyatt. World of Hyatt is not a smart locality program.

  9. Without some excellent night-based promotions with big earnings, I am done chasing Hyatt status. That said, I bet they have said promotions, so I guess there may be a 50/50 chance of my renewing Globalist. Time will tell…

  10. The welcome email clearly states that the 1-7 free night will be valid for a year this year:

    This year, enjoy our gift – a free night in a category 1-7 Hyatt hotel or resort and 4 suite upgrade awards (both valid through Febr‌uary 2‌8, 20‌18).

  11. Completely agree. Been a LTP with Starwood for a few years… and was switching to Hyatt since early summer last year as a result of the Marriott takeover (I just have some strange hatred of Marriott – maybe it’s the laughable 500 points for Platinums welcome amenity).

    Anyway, I enjoyed Hyatt thru the back-end of 2016… but then comes World of Hyatt and I’ve been seriously reconsidering over the last couple of weeks.

  12. When you are complaining that you might not be able to use a hypothetical free night for maximum value in the Maldives, you’re talking to a very niche crowd. The rollout has been weird, and the logo and names are terrible, but this program doesn’t seem all that much different from the previous program (except for adding a mid-tier which, thank you Hyatt for that). The biggest gripe for everyone should probably be that they still don’t count award nights towards status.

  13. I’m writing this from the park Hyatt Dubai using up my last DSU from 2016. 🙂

    Will the free certificate for current diamonds (cat1-7) also expire in 120 days or will the transition gift actually be a useful gift?

    I don’t know about the rest of you but when I travel with my family of 4 I really get a good value out of the DSU’s, generally hyatts are nice and all but take away that benefit and all the hard work (I’m based in Europe btw) to reach diamond seems absolutely useless. Unless your traveling to a usa backwater town who has a Hyatt place/house it is really tough to meet the re qualification criteria. I wish they had considered some sort of exception to the guys paying an average of 400 a night when a grand or park Hyatt is the only option. If the cash qualification was leveled out (100usd for Hyatt house X 60 nights is 6k) as opposed to almost twice that then I could have seen a fair option.

    I will burn my last the 200k GP points and the last 4 DSU this year and then no looking back. Just doesn’t seem to be a fair program! It’s a shame as minus a few exceptions the Hyatts I’ve stayed at are pretty good.

  14. @ Ben O. If you are big spender, you can qualify by spending earning 100k base points ($20k spend at the hotels) and not have to qualify under 60 nights. If you spend a $400 a night, then you could do it in 50 nights.. spas, restaurant spends during those stays.. you can requalify in even less time.

  15. Over the past couple of years I was warming to Hyatt and maintained platinum status, which was adequate – I don’t chase hotel status in programs since I’m a low-mid level road warrior. The last two stays at Hyatts have been plagued with issues. Hotel management seems indifferent and HGP were slow to respond. The limited footprint and options within a particular market were always an issue, but I see this new loyalty program as a means to say “if you’re staying 60+ nights with us a year in our limited footprint, we love you (mostly, but want you to stay with us even more). Everyone else? Meh.”

    Not how you earn loyalty. And their marketing department – or marketing consultants – should be fired for that eyesore of a logo for WoH. I’ve seen make-up on a pig look better than that.

  16. As a diamond member for a few years I don’t like the new program at all. Since 2017 I have had 6 nights with Hyatt but for the next 35 hotel nights starting today until the end of march I will stay at spg, Marriott, and Hilton hotels to stay away from Hyatt until hopefully they come to their senses and revisit their loyalty program.
    I think I will be happy enough to keep my spg/Marriott platinum status and Hilton diamond, and forget about Hyatt globalist for 2018, period.

  17. Very well written. For a chain like Hyatt with smaller footprint, these expiration policies are a big gotcha. Hopefully they listen or I hope they learn the mistake the real hard way.

  18. from the announcement on, seems to me this thing was designed by 20 yr old business school grads that are good at # crunching and socialism-subscribing liberals. the video ads that came out preaching community values further convinces me so.

  19. I chose to not requalify for Hyatt Diamond last year but soft landed on Explorist. Hyatt properties are closest to my office and I doubt I can hit 25 stays this year for SPG Plat, especially with a handful already under my belt to Hyatt. But then I’ve been a Hyatt Diamond based on stays, that really was a simple way for me to hit status. Now I think I’ll not maintain any loyalty and will feed off of my AMEX Plat hotel status…

  20. “RIP Hyatt!!! I am all in for SPG now.”

    Must be a necrophiliac to jump from one dead program to another 😉

  21. @Robert, in theory you may be able to earn SPG plat for as little as 9 stays (or 9 individual nights). Your AMEX plat should get you SPG gold which can be linked with Marriott Rewards, giving you automatic gold status. Call/email Marriott Customer Service and ask for the Platinum challenge. For as little as 9 stays (or 9 individual nights), they will upgrade you to plat from gold as soon as you complete the challenge. And since both accounts are linked, you should also get plat status on SPG.

  22. How long do you have to use free category 1-7 as a Globalist when it hits your account March 1?

    2) once you complete five brands; you will receive a category 1-4 cert;
    Does that cert expire in 120 days?

  23. Say you’re staying at hyatt place/hyatt house and don’t need benefits such as late checkout, etc. If you were to omit your hyatt # and claim missing nights later on, wouldn’t that push the issuance/expiration date further back?

  24. @Travis – Your entire post is about whether people who travel like you (or Ben or Tiffany or myself for that matter) would be incentivized (or not) to stay at Hyatts. It’s fairly easy to infer that the population that cares about a welcome amenity or plans their travel to allow multiple extensive vacations a year is, as I mentioned, quite small.

  25. I agree 100% with this article. 120 days from issuance will screw up most people’s travel plan throughout the year.

    I’m lucky enough to have a good amount of Hyatt Place around me. I’m a GP Diamond and it took a lot of time and thinking to make this decision, but I dropped 78,550 points & $1,375 for 25 stays (points + cash) during January and February of this year. This allowed me to have Globalist status for 2017, 2018, & Jan/Feb of 2019.

    At least this way I can get the most out of Globalist benefits. So for the rest of 2017, I will still continue to stay at Hyatt, but starting in 2018 when I will need to start qualifying for status again, I’ll switch over to SPG.

    Like most people, I achieved Diamond status through stays and I already know I won’t be able to make the 60 nights per year. 50 nights is already pushing it for me.

    While Hyatt is still my preferred hotel, I do hope that during 2017 or 2018, Hyatt will be able to pull something off and change my mind about switching to SPG because I really like & enjoyed all the Hyatt properties that I’ve been to around the world.

  26. the architect of this disaster called world of hyatt must’ve been on a payroll of SPG.
    so far this year i have 2 stays with hyatt vs. 5 stays with SPG and next 5 upcoming stays will be with SPG.
    last year, my 8 stays through february 2016 was with hyatt exclusively.

  27. The perks that are of most value to me are also the room upgrades and free breakfast. After getting my Chase Sapphire Reserve card I discovered one of their travel benefits was the Luxury Hotel & Resorts Collection. Browsing through their participating properties, Hyatt seems well represented although not completely.

    I have only a few days left as a diamond, but seeing that I can potentially get the benefits that are most important to me without having to jump through the WOH whoops when I stay at one of their properties made it an easy decision to switch over to Hilton. The only downside that see is that LHRC doesn’t always seem to price right.

  28. All you SPg loving keyboardwarriors stop complaining and stay with SPG then. Getting tired of hearing all you men becomming like bitches..

  29. I agree 100%. Excellent post that clearly illustrates many of the shortcomings of this horrible new program.

  30. Thanks as always for another logical and reflective piece. There is much wrong with the World of Hyatt that I chose to end my long term Diamond status with Hyatt at the end of 2017. What surprises me is the number of comments stating the same conclusion.

  31. OK, sick props to Travis. Every major blogger (especially Gary from VFTW) is shilling Hyatt’s WOH program so hard, I’m wondering if they’re getting W2 tax forms for their sales pitches.

    We’re 7 weeks into 2017 and thanks to RC Visa + Platinum challenge, I already have MR Plat + RC Plat + SPG Plat + United Silver. I’ve had 2 suite upgrades for 8 nights. I’m done with Hyatt and not looking back.

    #yourmillenialstrategysucks #hyattfail #learnhowtofont #expiringbenefitsarentbenefits

  32. I think the calculation of the welcome amenity loss isn’t acurate. There are 3 cases in the new program for diamond members (assuming the welcome amenity is 1000 points each night):

    1) Diamond will lose 29k points without any compensation when staying less than 30 nights;

    2) Diamond will lose 59k points when staying greater than 29 nights and less than 60 nights in exchange for a category 1-4 certificate that will expire in 120 days;

    3) Diamond will lose more than 60k points and less than 365k points when staying more than 60 nights in exchange for 1 category 1-4 certificate and 1 category 1-7 certificate both of which have a 120-day expiration.

  33. Jey —

    The Diamond welcome amenity was per STAY, not per night. So I think your math assumes lots and lots and lots of 1-night stays. I made the possibly more realistic assumption that the average stay is 2-3 days and some of the stays were at Hyatt House / Hyatt Place where it is only 500 points.

    But yeah, everyone should look at their stay history to calculate the own loss. And for some, it will be more than I estimated, agreed.

  34. Of course, award nights don’t count for earning status, so anything earned will just make it that much more difficult to requalify. That’s the biggest killer for me. Doing 55 nights per year is crazy, but even if I could, when would I have extra time for award nights.

  35. Thanks for this brilliant assessment, Travis. It’s a perspective I hadn’t seen. I fully expected the piece to be about people choosing to stay elsewhere since qualifying with 60 nights is simply impossible for most people (aka me), so there are those of us who have been Diamond that may simply shift business elsewhere. The welcome amenity in some instances was far more valuable than 1,000 points in some cases. At the Regency San Francisco, the alternative option was a $50 food credit. Once applied to the account, it typically just worked as a general credit even if one didn’t spend $50 on food. That provided great incentive for me to stay there. Now? Hmmm. Hyatt’s implication that people want more free stays instead just doesn’t work for me. We shall see what ultimately happens with the odd WoH concept.

  36. Totally agree, Ben. In the UK the Lloyds Amex card gives a BA Avios upgrade certificate after £7k spend. It’s valid for 12 months from issuance – in therefore spend £6,500 quickly and delay putting any more on the card until I want to trigger the voucher. They’re losing out on thousands in card spend as a result!

  37. Hyatt GP was by far and away my favorite program, and my most valued Diamond perks were breakfast and club level rooms. I am now an “Explorist” and have neither amenity that I so enjoyed.

    I am now on to to other programs, I am Diamond at Hilton and Spire Ambassador at IHG. No reason to mess with the new, dumb, WoH program. Only one stay at a Hyatt this year so far and none planned for the future. I may cancel my Hyatt card too, there is no reason to have the card beyond the one free night now and one measly night with no benefits is not that exciting.

  38. It’s good to see this post. Most complaints have not been about the loss of the 1,000 point amenity. That is the most egregious part of the new program. I am a three decade elite member of Gold Passport. I have always considered GP to be frankly about twice as good as the others. Suddenly they are half as good. Since I am also Platinum Premier with Marriott, the acquisition of Starwood now makes Mariott my go to choice. Top management at Hyatt must have forgotten that we have a choice. They are already seeing a decline in revenue. I’m not only abandoning the program, I sold my shares of Hyatt stock. The board of directors will eventually shake up the executive floor but I’m not willing to wait for that.

  39. My days directing paid stays to Hyatt are over. Looking forward to burning my Hyatt points this year, while I still have top tier status.

    Marriott was very happy to offer me a Plat challenge.

  40. The new scheme actually encourages you to fly 100,000 miles as fast as you can.

    … and spend 12 thousand dollars

    I spend ~200 nights a year with Marriott. Hyatt’s program is pretty restrictive for such a small footprint.

  41. @Juno that’s the thing I do stay at the higher end hyatts when I can, being based in Europe means half the time I don’t even have that option (small Hyatt footprint) and to me it’s a little bit unfair some guy in Iowa could make it by spending 6K and I’ve got to spend at least 2-3 times that.

    I travel 50-60 nights a year easily for work but it’s very difficult to find a Hyatt and many times I had to go out of my way for it. Well in my case I’ll burn the points and 2017 DSUs for my fun travel but all the bulk of the work stuff will go elsewhere.

    Luckily Starriot/Marriwood has a good combined top end coverage. Kinda makes me sad to see a formally good program die a slow death like this.

  42. Even the DSU’s are becoming less valuable as properties go out of their way to prevent them from being used. Example: GH San Francisco created a fake suite category called “Executive Suite” yet they have no such suites, at least if you look at availability 12 months out, when few if any rooms have been booked. The lowest category suite available for sale is the “Executive Suite- City View”. When trying to use a DSU they just claim that no entry level suite – the Executive Suite – is available. I have read other posts on FlyerTalk where others have experienced the same at other Hyatt properties.

  43. For me, the welcome amenity was my favorite thing. Bummer, I can stay at Marriott’s and get free wine

  44. I just cancelled my three nights at Hyatt regency in Shanghai and will stay at spg Sheraton for the coming 10 nights. My immediate goal is to complete my 25 stays at spg.:-)

  45. I have been a VERY loyal Hyatt customer, and Diamond Member, since 2008. I am fairly close to being a lifetime member, but This “new” program is a huge disappointment, and has given me reason to look at other properties! Everyone here knows why, so I am not going to waste my time explaining why. I hope Hyatt reailizes they need to rethink this before it’s too late.

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