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Is a Massive World of Hyatt Devaluation and Dynamic Pricing on the Horizon?

In the ever-evolving world of hotel and airline loyalty programs, one program has stood as a beacon of consistency: World of Hyatt. As other major hotel chains switched to fully dynamic award pricing, Hyatt remained the last stronghold with its steadfast award chart, and a consistent dedication to its members and good customer service. As a Hyatt Globalist member, their program has been the only one I’ve ever participated in where “loyalty” truly feels like a two-way street; it’s a relationship built on trust, and they’ve simply always done right by me. There’s a lot to be said for that. However, recent developments have raised questions about the future of Hyatt’s award program. Could a massive devaluation and a shift to dynamic pricing be imminent? Let’s take a closer look.

Hyatt’s Mini-Dynamic Shift
Last year, Hyatt introduced a “mini dynamic” element to its award pricing by adding peak and off-peak redemption rates. While this signaled a shift away from the traditional fixed-price award chart, Hyatt managed to keep the number of nights classified as peak to a relatively fair percentage. This was a commendable effort, especially when compared to competitors like Hilton, whose dynamic pricing turned Hilton Honors points into the SkyPesos (SkyRubles?) of the hotel industry. Even with Hyatt’s changes, there are still plenty of opportunities to get outsize value out of your Hyatt points; just maybe not as plentiful as in 2021.

Hyatt’s Relative Stability
Despite the rapidly changing travel landscape in the wake of the COVID-19 pandemic, Hyatt has remained relatively steadfast in its loyalty program structure, while airlines and other hotel chains have largely devalued their programs to varying degrees, possibly to get liabilities off the books in the wake of COVID-induced financial losses. In the world of loyalty programs, prolonged periods without significant changes often foreshadow impending upheavals on the horizon.

Signs of a Transition
Several signs suggest that Hyatt may be on the brink of fully embracing dynamic pricing:

  • The introduction of peak and off-peak pricing in 2022 marked the beginning of this shift, signaling that Hyatt isn’t fully opposed to the concept of dynamic pricing.
  • Hyatt’s once simple award chart has now evolved into three separate charts, each with its own quirks (and of course, separate columns for peak, standard, and off-peak dates).
    • The original hotel award chart with numeric categories 1-8, where some properties, like Park Hyatt Paris Vendome, have moved up to category 8 for the first time. While category 8 isn’t technically a new category, it has historically been reserved for partners like Small Luxury Hotels of the World (SLH); only recently has Hyatt elevated any of its own properties to this category.
    • An all-inclusive award chart using lettered categories A-F, which also specifies pricing for additional guests.
    • Yet another award chart for Miraval resorts, based entirely on room type rather than any form of category system.
  • The addition of “Homes and Hideaways,” a short-term home rental platform similar to Marriott Homes & Villas and Airbnb. While earning & redeeming Hyatt points for home rentals sounds intriguing, it raises questions about how these unique accommodations fit into a traditional award chart. My guess? They won’t, and Hyatt likely never planned on that.

The complexity of managing these multiple award charts and the introduction of Homes and Hideaways might indicate a transition away from fixed award charts to fully dynamic pricing. The award charts are just getting too messy and complex, which to me begs the question of not if, but when Hyatt will give up on adding additional layers of complexity and go all-in on dynamic pricing.

Hyatt’s New Reservations System
Keen observers have noted that Hyatt’s pending shift to the SABRE Global Distribution System (GDS) could play a pivotal role in facilitating a transition to a fully dynamic pricing model. This move to a more sophisticated and adaptable GDS system could provide Hyatt with the technological infrastructure needed to efficiently manage and update award pricing in real-time, enhancing the feasibility of dynamic pricing implementation. As the hospitality industry continues to evolve, this technological upgrade may indeed be a key component in Hyatt’s potential shift toward a more punitive flexible award pricing structure.

The Fate of Category 1-4 Free Night Certificates
If Hyatt were to adopt fully dynamic pricing, it raises questions about the fate of Category 1-4 (and Category 1-7) free night certificates. A likely outcome could be fixed cap on the value (in points) of each certificate, similar to what Marriott Bonvoy does with certificates. Marriott’s certificates tend to be capped at 35,000 points; however, as Hyatt points are much more valuable, it’s likely the caps would look more similar to today’s categories 4 and 7, respectively (the question is: will they follow standard or peak?).

When Can We Expect These Changes?
Historically, Hyatt has made category changes and devaluations every March, rarely straying from this pattern. While dynamic pricing may not be the most welcome change, we can hope that Hyatt, known for its fair practices and consistency in treating its members well, will implement it in a more equitable manner than some of its competitors.

While Hyatt has held its ground as the last major hotel chain with an award chart, recent developments suggest that change may be on the horizon. As we move forward, it’s essential for Hyatt loyalists to keep a close eye on developments – and perhaps a speculative booking or two wouldn’t hurt, either.

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