Yesterday Starwood published details of their new promotion and I’ve been smiling quite a lot these past 24 hours.  This promotion is so good that I waited 24 hours to let it sink in.

The first set of hotel loyalty promotions for 2009 were nothing to get excited about. Points bonuses are great for business travelers who are going to be in hotels anyway, but I work through my hotel stays on an annual plan. The first four months of hotel promotions were nothing special historically. Starwood Preferred Guest has now given us a historic promotion for 2009.

Why spend $1,000 in February and March for 20,000 points when I can spend $1,000 in June and July for free nights worth 100,000 points?

My Loyalty Traveler advice is to take advantage of the opportunity. This Starwood Preferred Guest promotion is the best deal from Starwood Hotels in quite a long time.  Who knows how long it will be before another promotion comes along as lucrative as this one? (Hyatt’s Faster Free Nights will probably return in 2009, however, Starwood has hundreds more upper upscale hotels than Hyatt.)

The Offer: Every two stays earns one free night. Starwood paid hotel stays at any property are eligible for earning promotion credit.  Starwood Hotels includes the hotel brands: Four Points by Sheraton, Sheraton, Westin, aloft Hotels, W Hotels, element, Le Meridien, Luxury Collection, and St. Regis Hotels.

Free nights earned are valid for a Friday, Saturday, or Sunday night stay at a Category 1-6 hotel. There is no limit for free nights earned. The opportunity to redeem a free night at a Category 6 hotel is a rare opportunity.  These are quite generous terms.

Promotion Registration is Required: Member must register online at SPG.com/freeweekends by July 31, 2009. 

Promotion Dates for Earning Free Nights: Paid stays from May 1, 2009 through July 31, 2009 qualify for free night promotion.   A multi-night stay extending through these start and end dates also counts.  For example, stay April 29 to May 2 and that counts as a stay.  Stay July 31-Aug 4 and that also counts as a stay.

Redeeming Free Nights: Free nights may be redeemed through September 27, 2009 at a Category 1-6 hotel.

“How do I redeem a Free Weekend Night Award?

To redeem a Free Weekend Night Award, Preferred Guest members in the U.S. or Canada should call 866-539-0059. Elite members should call their dedicated Gold or Platinum customer service lines. Members residing outside the U.S. and Canada should contact the SPG Customer Contact Center for your region; Advance reservations are required, and all members should ask for Award ID 9FWFN.”

Free night credits should be posted within 3 to 5 days after qualifying activity. Free nights are only available for weekend stays on Friday, Saturday, or Sunday. You may redeem consecutive free nights and you may combine free nights with paid nights or other SPG redemption nights such as Cash & Points or Free Nights using Points.

Category 7 hotels are excluded from free nights redemption and four other lower category “all-suites” hotels are excluded from Free Weekend Night Award redemption:

·         The Resort at Singer Island,

·         Pine Cliff Residences,

·         Sheraton Vistana Villages International Drive, and

·         Sheraton Vistana Resort Lake Buena Vista

Restrictions: The primary restriction is Free Weekend Night Awards are not transferrable and may not be gifted. The member who earns the free nights must be the guest who stays.

Loyalty Traveler analysis:

I’ll tell you my plan. I took a look at Category 6 hotels and Category 5 hotels  where I can leverage this promotion to stay at hotels I would not otherwise be able to afford. I have my sights on three hotels:

·         St. Regis San Francisco,

·         St. Regis Aspen,

·         St. Regis Monarch Beach

These hotels are my Staycation Bucket List.

San Francisco and Monarch Beach in Orange County are within driving range. My wife’s family is in Denver and I have desired a trip to the St. Regis Aspen for several years.  My plan is simply fly K and myself to Aspen and let the family drive up and visit us.

As a rule of thumb I use $100 per hotel night when calculating promotion expenditures. Even downtown San Francisco has had room rates under $100 this year.  20 one-night stays = $2,000.

I look at a $2,000 investment for 10 free nights.  Obviously, St. Regis  Aspen would need to be a 3 night stay and I could work St. Regis Monarch Beach in as a 3 night stay and use the remainder of nights at the St. Regis San Francisco.

Here are sample room rates:

St. Regis Aspen, Fri-Mon, June 12-15 $309/night or $1,020 for three nights after tax.

St. Regis Monarch Beach, Fri-Mon,  July 10-13, $575/night or  $1,983 for three nights after tax.

St. Regis San Francisco, Fri-Mon, Aug 7-10, $429/night or $1,488 for three nights after tax.

Bottom line:

Starwood is being proactive in this poor economic environment. The luxury hotel segment has been hardest hit with declines in occupancy and rates.  Hotels sitting at 30% occupancy is a recipe for employee layoffs and more limited service as a result.

This promotion allows Starwood to fill hotels across the market segment spectrum. Hotels will get through this tough economic climate, but a luxury hotel has a difficult time providing service without employees and it is hard to maintain employees without hotel guests to service. This promotion seems designed to share the pain and provide a gainful opportunity for customer loyalty and guest occupancy.

I see this as a win-win customer relations strategy.

I estimate my $2,000 planned investment will have a return of $4,500 in added value benefits from the free room nights at St. Regis hotels.  In addition as a SPG Platinum elite, I will likely receive $2,000 to $3,000 in added value for my 30 nights of hotel stays in the form of room upgrades, Starpoints earned (15,000 or so), and hotel amenities. And Platinum elite requalification is assured for 2010.

This Starwood Preferred Guest promotion will likely provide K and I with 30 nights of hotel rooms with added value around $7,000 on top of the $2,000 to $2,500 investment for the hotel stays.

That is why I have been smiling for the past day. This offer is really good for our hotel lifestyle.

Links:

FlyerTalk thread on SPG Promotion

SPG Promotion link

SPG Promotion Terms and Conditions

SPG Promotion FAQ

Coach Air Travelers to Pay for Premium-class Excess?

Joe Brancatelli has a great read from the Washington Post on the long term outlook for air travel.  He predicts the economics of premium cabin extreme makeovers these past few years will result in higher economy class fares for the leisure traveler coming soon as the profitable premium-class flyers dwindle.

When it comes to hotels the Early Bird gets Hosed

Sarah Nassauer had a piece in the Wall Street Journal March 31, “Travelers find it pays to wait for late deals”.  The article cites data from Travelocity’s senior editor, Genevieve Shaw Brown, indicating hotel guests received average room rates 20% lower within 30 days of travel compared to reservations made more than 60 days before travel.

My observations for San Francisco over the past year show the lowest rates typically occur between 7 and 14 days prior to travel for upscale San Francisco hotels.

Cool Hotel Websites

Adam Kirby, associate editor of Hotelsmag.com, had a visually stimulating piece “Web Designers Name Favorite Hotel Sites”.  I liked seeing what designers like in a web site.

I really do intend to put LoyaltyTraveler.com back online this year and I was looking for ideas.  The capital Catch-22 for a small business is you need money to make money. I’ve been in short supply.

Europe Hotel Rates Decline but Brits are Still Too Broke

The Telegraph, a British paper had an April 6 article by Charles Starmer-Smith “European Hotels Cut Rates” showing the steep decline in European hotel rates of 10% to 25% since November 2008. The impact of the Sterling’s value dropping 20% against the Euro during the same period means hotel rooms are still more expensive for Brits traveling to the continent.

Hawaii Hotel Rates Near Record Decline

USA Today published a piece by Jaymes Song, AP writer, “Hawaii Hotels have worst February in 18 Years”.  Hawaii had its worst hotel room occupancy for February in 18 years since Gulf War # 1. Apparently February is normally the busiest month of the year in Hawaii. Occupancy varies across the islands with Oahu doing the best at 78% and the Big Island Hawaii down to 64%.  Rates were down across the board, but after several years of huge annual increases the hotel rates are still no bargain. The average daily rate is still $187 per night after a 12% decline over the past year. 

Hotels are crying about revenue, but at Hawaii RevPar $140 in this downturn compared to $74 in late 2001, I say that still looks like some impressive growth – something like 10% per year average since 2001. I am not a hotel economist so perhaps the data is worse than it appears to me.

Does Priceline help the local economy?

Tom Belden had a piece in the Philadelphia Inquirer, “Winging It: Bad business climate means good hotel rates”. This article cites PKF Hospitality Research saying the decline in hotel profits, about 30% in 2009, will be the greatest one year decline since the 1930s. Interesting that the article mentions hotel stays as a frugal and civic minded way to help your local community. In the end the writer books a $65 Priceline stay at the Sheraton City Center. 

As Loyalty Traveler I advocate local hotel stays as a frugal and civic minded staycation strategy to reach elite status that pays off on the real out-of-town vacations.  But I advocate booking through the hotel’s website.  

Does Priceline help the local economy? I guess so, since the hotel guest will likely spend money at businesses in the vicinity of the hotel.  A direct booking with the hotel probably helps more.

Tim Winship  - Commandeering  the campaign for more frequent flier awards, temporarily at least

“Survey finds no improvement in frequent flyer awards” – Tim Winship

548 people have spoken to Smarter Travel and Frequentflier.com. Award tickets to Europe are easier to get these days. 

Apparently the frequent flier programs are lining up the miles for paying customers with all the ongoing double and triple elite miles offers. When it comes time to spend your miles earned from all those flights that made you an Executive-1KChairman-Platinum elite flyer, the airlines are still being stingy.

Tim thinks the airline’s are missing a great opportunity for customer relations by holding back award seat inventory in this economic climate.

Kimpton Hotels Had a Birthday and I missed it

Last week was a bad time to miss out on emails. I missed the Kimpton Hotels $81 sale .  The basic deal was $81 per night for a two-night stay at nearly any Kimpton. Reservations were accepted from Thursday April 2 to Sunday, April 6, 3pm Pacific time. By Saturday, April 4, two days into the sale there were few properties left.  There were still some rooms at three or four San Francisco Kimptons when I finally saw the Kimpton sale.  

Hilton HHonors announced their HHonors second quarter promotion for 1,000 points per night.

www.hiltonhhonors.com/1000bonuspoints The offer runs from April 13 to June 30 and registration is required.

On a Personal Note:

The past two weeks I have seen project deadlines, relative visitors, and the flu – first for K and then for me.

We did work in a stay at the Hyatt Highlands Inn in Carmel and had another wonderful visit in our wannabe home away from home where the mountains meet the sea. The irony was our stay in the Carmel Highlands was the only day with fog for the entire week. 

K started chemotherapy this week for her rectal cancer and I feel like I acquired “chemo brain”.  

Really – it is a published side effect of mental fog for cancer patients (and based on my experience chemo brain is contagious like the flu). Perhaps this week, now that the fog has temporarily lifted, I will get back to writing on hotel loyalty program developments.

Sunset view from Highlands Drive (above Hyatt Highlands Inn), Carmel, California

Hyatt’s Gold Passport hotel loyalty program introduced major program changes for its members today.  So far my initial analysis indicates the changes are true enhancements for members.

Major Hyatt Gold Passport changes effective April 2, 2009 – Hyatt Gold Passport link to changes

1.    No blackout dates for free rooms using points. You can redeem points worldwide for any standard room available.

Blackout dates were often a problem with Hyatt Gold Passport points redemptions. Additional points were required. It is unclear to me if the no blackout policy for award rooms affects the availability of hotel awards at a 60% points premium for Platinum and Diamond member awards when award inventory is unavailable. Is it now moot with no blackouts?

2.    Complimentary internet access for elite members at Hyatt full-service hotels.  I have actually stayed at Hyatt Place hotels over Hyatt Regency for the privilege of free internet access.  This is a welcome change.

3.    Published room upgrades for Platinum members include upgrade to the best available rooms within the category booked.  Think higher floors, better views, quieter locations.

4.    Diamond members will receive upgrades to best rooms available including Regency Club and Grand Club rooms. The official terms state this benefit excludes suites.  There is an opt-out option for the hotel during periods of high demand. In lieu of Regency Club access, the member may be offered restaurant full-breakfast certificates and 2,500 Gold Passport points. Regency Club access is nice, but 2,500 points seems a fair compensation.

5.    Diamond members receive four confirmed suite upgrade e-certificates per year for stays up to 7 nights. This benefit is huge and potentially worth thousands of dollars in room upgrades.

The Big Welcome Promotion – Hyatt Big Welcome link

Hyatt Gold Passport is launching these changes with a global promotion entitled “The Big Welcome”

The Big Welcome has big rewards for lucky and talented Gold Passport members. Hyatt is giving away free room nights every day between April 2 and May 13. Simply complete a Hyatt survey providing detailed information on your hotel loyalty program membership and hotel stay pattern for the past six months.

Essay writers can also enter a 250 word essay contest for the chance to win 365 Hyatt free room nights and 1,000,000 frequent flyer miles. This Grand Prize winner is a judged entry and will be awarded in June 2009. The taxable value is nearly $150,000.

Loyalty Traveler will provide a detailed analysis of The Big Welcome promotion in the coming days.

Hyatt Highlands Inn, Carmel, California