The Most You Should Pay for a Hotel: Marriott

This is the fourth in a series of posts on how to save money on hotel bookings by purchasing rewards points. For a more detailed explanation and walk-through of the theory, see the first post on Hyatt hotels.

The Details

Marriott Rewards is actually two programs in disguise, offering rewards for both the standard set of Marriott branded properties as well as the hyper-luxurious Ritz Carlton portfolio. Because of this, it has fourteen separate categories for its hotels — nine for Marriott and five for Ritz Carlton. It’s award charts are as follows:

Marriott Award Chart

Ritz Carlton Award Chart

Like Hilton, Marriott hotels tend to be bunched up towards the middle to upper end of the category list, which means that the annual points purchasing limit starts to become a limitation for multi-night stays. Specifically, Marriott allows you to purchase up to 50,000 points per year for a price of 1.25 cents per point. This means that, unless you find a Category 5 and below hotel (which become fewer and fewer in number each year), you can only hope to get one night out of this hack. Here would be the costs of hotels in each category based on the purchase price of Marriott points (first half is for Marriott-branded hotels, and the second is for Ritz Carlton hotels):

For the most part, except for at the very upper end of Marriott portion of the chart, you’re unlikely to beat the cash rate, especially once you factor in the points you would earn from rewards stays (Marriott typically has promotions that allow you to earn double points as well). Similarly, you might get lucky and find that the points cost of a hotel is discounted by 5,000 (Marriott calls these ‘Points Saver’ awards), but that typically means the cash rate is equivalently, if not more, discounted.

Thankfully, the situation will get somewhat better this year, as Marriott recently announced a revamped points and cash program. Previously, points and cash meant you could mix award nights with paid nights in a single reservation (which you can just do in any program by making separate reservations and calling the hotel and asking them to keep you in the same room), so there was no real opportunity for saving money. However, at some point this year, they will be switching to the points and cash model that we are familiar with from the other programs, offering rooms for a reduced points rate plus a cash co-pay. Here are the announced rates and the corresponding cash costs:

While still not great, there is some potential for value in the middle of the points and cash award chart, which is the opposite of the standard award chart because of the price compression that happens there (with cash costs only increasing by $5 for the first few categories).

Unfortunately, those looking to stay at top-tier Marriott hotels (Category 9) are actually worse off with points and cash rates, modulo the advantage that they extend your points purchasing limit by 17,000. Similarly, top-tier Ritz Carlton hotels don’t offer much of a discount over the normal purchasing rate ($335 for 32,000 points for a Tier 5 Ritz Carlton works out to a bit more than a penny a point), but points and cash could still be worth doing for the $65 discount and the 32,000 points savings.

One more thing that I’ve left out until this point is that Marriott also offers the fifth night free on award bookings. Although you’re unlikely to be able to purchase enough points on your own for four nights at a hotel (you’re limited to Category 1 and 2 hotels, and the benefit doesn’t apply to points and cash bookings), Marriott allows members to transfer points to each other for a flat fee of $10 (see ‘points sharing’ here). So that’s worth keeping in mind, since it can offer another 20% savings over cash for longer stays and may tip the scales in favor of purchasing points (unlike Hilton, for which it’s generally unattainable).

An Example

By now, I’m pretty sure you can find single-night examples fairly easily, but here’s an example of a situation in which a single night redemption is not worthwhile, but a five-night redemption is. As a reminder, the new points and cash redemptions are not yet available, and Marriott has yet to announce a firm date for their rollout.

Let’s say you jumped on the Qatar Airways deal to South Africa that was going on yesterday and you needed to book a hotel. The African Pride Audacia Manor Boutique Hotel in Morningside, South Africa would normally run you $174/night or 15,000 points. Consulting our table above, we see it would cost $187.50 to buy those points, so we’re better off paying the cash rate.

A one-night, non-refundable redemption would cost you $174/night or 15,000 points.

However, when we extend our stay to five nights, the fifth night free bonus kicks in and reduces the points cost of the stay by 20%. Instead of 75,000 points for five nights, it costs only 60,000. The total cost to buy those points (plus the $10 for a friend to buy and transfer to your account) would be $760, whereas the cash cost for the five nights would have been $870. Good stuff!

A five night stay costs 60,000 points instead of 75,000.

Admittedly, the likelihood that you’ll both be looking for a five night stay AND it’s actually cheaper to use points than pay cash is very low, but I figured it would be useful to demonstrate another way to get value out of points bookings.

Happy hacking!