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Earlier this month, IHG pushed through another unpleasant devaluation to its IHG Rewards program and, all in all, it was a very IHG devaluation – it was bad, no notice was given, nothing was communicated to members once the devaluation had happened, and the people in charge of implementing the devaluation messed up it up so badly that even the IT guys over at British Airways were left laughing. Still, now that the dust has settled a little, it’s time to take a proper look at how to view IHG Rewards as part of a broader miles & points strategy.
The Problem With IHG Rewards
There’s Little Point In Trying To Earn IHG Rewards Status
It shouldn’t take a particularly long or hard look at the IHG Rewards elite benefits chart for most people to see that the program is among the least rewarding hotel programs around.
A cursory glance is enough to tell you that not even top-tier Spire Elites are entitled to a basic benefit like complimentary breakfast (something that Hilton gives its mid-tier elites), and when you read the small print surrounding room upgrades…
“Platinum Elite and Spire Elite Members will be offered a complimentary upgrade, as determined by the hotel, which might include rooms on higher floors, corner rooms, newly renovated rooms, or rooms with preferred views. The upgrade will be offered at time of check-in, subject to and based on availability, and will only apply to the Member’s personal guest room. The hotel is not required to upgrade Members to suites or specialty rooms.”
…it quickly becomes obvious that they’re far from guaranteed, they’re likely to be unimpressive, that suites aren’t part of the deal, and that hotels have so much leeway that it’s easy for them to deal with guests in whatever way they feel is appropriate (i.e. is best for the hotel and not necessarily the guest).
Marriott Bonvoy, Hilton Honors, and the World of Hyatt all have their weak points but they’re all considerably more rewarding than IHG Rewards (which makes it more than a little ironic that it’s the only program of the 4 to have the word “reward” in its name).
Even if you happen to be someone who’s deeply in love with IHG properties and who sees great value in having some kind of status with IHG Rewards, it must be hard to justify spending serious amounts of cash to earn that status.
Spire Elite status is only marginally more “rewarding” than Platinum Elite status and Platinum Elite status is given away as one of the benefits of the IHG Rewards Premier Credit Card (review) which only costs $99/year and as one of the benefits of InterContinental Ambassador status which can be purchased for $200/year.
If the lack of meaningful benefits isn’t reason enough not to chase IHG Rewards status, even the most die-hard IHG fan must surely question the point of spending thousands of dollars on hotel stays in a bid to earn IHG Rewards status when Platinum Elite status can be bought for $99 or $200.
There’s Not Much Point In Trying To Earn IHG Rewards Points
Anyone who was surprised that IHG devalued its Rewards program a couple of weeks ago clearly hasn’t been paying attention to what IHG has been doing for the past few years – we’ve seen IHG increase the cost of awards steadily year after year for at least the past 5 years. It’s because of these regular devaluations that it’s becoming increasingly pointless for people to make a special effort to earn IHG Rewards points.
Back in March, a top-tier InterContinental property was almost never going to cost anyone more than 70,000 points per night (they cost as little as 50,000 points/night not that long ago) while today even a Hotel Indigo can cost 90,000 points/night – that’s nothing short of ridiculous.
Why would anyone go out of their way to earn a currency that is almost guaranteed to devalue significantly every single year? To my mind, a program that can make the devaluation of the Turkish Lira look benign isn’t a program whose points I’m anxious to collect through stays and spending.
The two issues I’ve outlined above are the key issues surrounding the IHG Rewards program but I can’t end a section that talks about IHG Rewards issues without mentioning a few of the program’s other failings: It’s terrible at communicating with its members; its quarterly promotions have been getting worse and worse as the years go on; its website often has more bugs than the Amazonian rainforest, and it’s almost impossible to redeem points for a stay at the top (and most aspirational) InterContinental property in the world – the InterContinental Bora Bora Resort & Thalasso Spa.
The fact that IHG Rewards is so unrewarding and the fact that its currency devalues significantly every year are, clearly, very major issues, but it’s the whole package of issues put together that makes it the problem child of the miles & points world.
What To Do With IHG Rewards
The key to understanding how to deal with IHG Rewards is to realize that the program is misnamed (it’s not rewarding) and that it’s often miscategorized (it’s not a loyalty program). Once you come to terms with those two facts and realize that IHG Rewards should be seen as little more than a discount program, it becomes a little more obvious how to incorporate it into a miles & points strategy.
IHG has a number of very nice properties around the world and the number of aspirational properties within the program has just increased with the addition of a number of Six Senses Resorts so it would be foolish to suggest that it’s a program to be ignored.
That’s why while IHG Rewards is certainly not a program that I would recommend anyone consider as their primary hotel program, I see it as a program whose currency can easily be used to help travelers make significant savings on their hotel stays (with limited risk) and whose willingness to give away elite status cheaply can be used to help improve stays made at IHG properties worldwide.
If you’d like to keep IHG Rewards as part of your miles & points strategy, this is what I suggest: Don’t think of IHG Rewards as a vehicle to earn free stays. See it as a program that requires you to part with cash but that can help you save a considerable amount on the cash rate.
Step 1 – Use IHG Points Sales As A Way Of Discounting Your Stays
I’ve already said that I don’t see why anyone would go out of their way to actively collect IHG Reward points anymore, but you can still use points to help save on your stays – you’ll just have to buy them.
Historically, IHG has been happy to sell IHG Rewards members between 300,000 to 500,000 points/year (click here to see what the latest sale is offering) and if you’re traveling as a couple (who would have access to between 600,000 and 1,000,000 points per year) that should be more than enough for at least two amazing aspirational stays or substantially more mid-tier stays every year.
If you’re playing this game solo, you may have to be patient and wait for a 500,000 point sale if you have your heart set on a big (100,000/night) stay, but 300,000 points should be more than enough to lock in a number of great mid-tier stays.
The best time to buy IHG Rewards points is when IHG is offering a 100% bonus as that’s when the cost per point is just 0.5 cents and despite the recent devaluation, buying points at that price can still open up a world of great savings for anyone prepared to put in a little bit of research.
Earlier today I used IHG.com to search 5 major cities for reward night availability and I compared the cost of the awards to the cash rates for the same nights. The results were interesting but there are a few key things that you need to know before I present them:
- I performed one search per city on a randomly selected date with a bias towards late 2021/early 2022 when people are more likely to be able to travel and when the coronavirus is less likely to be having an effect on prices.
- The results you’ll see below are not a result of multiple searches performed with a view of finding results that fit my narrative – these are the only results that I saw.
- The only filter that I added to the search results was a filter to show the higher-end properties (which is why you’ll see a bias towards the likes of InterContinental and Kimpton properties) as these tend to be the properties that most people are interested in.
- The results presented below represent the first 3 properties that appeared in each set of search results.
- The cash rates shown include all taxes and fees.
Here’s what I found:
Miami November 2021
- Kimpton Epic Hotel: $440 or 46,000 points + $33 fees – value from using points = ~0.88 cents/point
- Kimpton Hotel Palomar South Beach: $248 or 26,000 points + $33 fees – value from using points = ~0.83 cents/point
- Kimpton Angler’s Hotel South Beach: $278 or 28,000 points + $33 fees – value from using points = ~0.88 cents/point
San Francisco March 2022
- InterContinental San Francisco: $541 or 69,000 points = ~0.78 cents/point
- Kimpton Buchanan Hotel: $499 or 55,000 points = ~0.91 cents/point
- InterContinental Mark Hopkins San Francisco: $324 or 42,000 points = ~0.77 cents/point
London September 2021
- InterContinental London Park Lane: $699 or 70,000 points = ~1.00 cents/point
- Crowne Plaza London Albert Embankment: $307 or 40,000 points = ~0.77 cents/point
- Crowne Plaza London The City: $383 or 54,000 points = ~0.71 cents/point
Singapore December 2021
- InterContinental Singapore: $306 or 47,000 points = ~0.65 cents/point
- InterContinental Singapore Robertson Quay: $312 or 71,000 points = ~0.44 cents/point
- Regent Singapore: $199 or 29,000 points = ~0.69 cents/point
Sydney January 2022
- Crowne Plaza Sydney Darling Harbour: $175 or 28,000 points = ~0.63 cents/point
- InterContinental Sydney Double Bay: $326 or 85,000 points = ~0.38 cents/point
- Crowne Plaza Sydney Cooge Beach: $189 or 31,000 points = ~0.61 cents/point
Out of the 15 properties that came up in my search results, 13 offered IHG Rewards members a return of between 0.61 and 1.00 cents/point while only two offered a return of under 0.5 cents/point.
Someone buying points at 0.5 cents each and then using those points to book 13 of the 15 properties shown above would be saving between 18% and 50% on their stay.
For anyone wanting to book some of the super-luxury Six Senses properties that have just been added to IHG Rewards, the news is equally good.
Here’s a randomly selected night at the Six Senses Uluwatu in Bali where someone using IHG Rewards points to book a stay would get over 1.2 cents/point in value out of their IHG Rewards balance for a saving of over 58%:
And here’s a randomly selected night at the Six Senses Laamu in the Maldives where someone using IHG Rewards points to book a stay would get over 1.5 cents/point in value out of their IHG Rewards balance for a saving of over 67%:
Whichever way you look a this, these savings are very impressive.
I’m going to go ahead and guess that some people will now probably point out that a points booking won’t earn IHG Rewards points while a cash booking will and so this has to be taken into consideration…but I disagree.
What I’m suggesting here is that IHG Rewards should be used as a discount program and not as a program in which to actively seek to earn points or elite status so the fact that a cash rate earns IHG points is irrelevant. If you don’t care whether you earn points or not and you just care about getting the cheapest deal (which is what I’m suggesting your stance should be), the value of any points that would potentially be earned is effectively zero.
KEY POINT: It’s important to note that I’m not suggesting that anyone stockpile IHG Rewards Points during a good sale in the hope of one day getting an amazing deal at some point down the line. That’s a terrible idea as it opens you up to future unexpected devaluations. Instead, I’m trying to show how points purchased at 0.5 cents each can help travelers save money and I’m suggesting that people buy points only once they’ve found a booking they’d ready to proceed with.
Step 2 – Get An IHG Rewards Credit Card To Save Even More
For $99/year, this card offers, among other things, IHG Rewards Platinum Elite status (for as long as the card is active) and it gives cardholders the 4th night free on all award bookings of 4 nights or longer (every 4th night of a stay is free so, for example, a cardholder booking an 8-night stay would only need to have enough points to pay for 6 nights).
With more and more reward nights now costing up to 100,000 points, this benefit can save a cardholder up to $500 on a single 4-night stay (assuming the cardholder would otherwise have bought points at 0.5 cents each to pay for the 4th night).
The IHG Rewards Premier Credit Card also gives cardholders an annual free night certificate valid at properties costing 40,000 points or less (which will help offset the annual fee) but it’s the 4th-night free benefit that will be of most use when it comes to saving cash on future award bookings.
For travelers who don’t feel they need Platinum Elite status and who would rather not pay an annual fee, the IHG Rewards Traveler Credit Card (review) may be a more appropriate option. Like the Premier Card, the IHG Rewards Traveler Card gives holders a 4th night free on all award bookings but it doesn’t offer elite status, an annual free night certificate, or a Global Entry credit and it earns fewer points/dollar at IHG properties than the Premier Card. It also, however, doesn’t charge an annual fee.
If you’re looking for a primary hotel loyalty program that’s rewarding, that offers good elite status benefits, and that will help you earn free nights with ease, I don’t think IHG Rewards is the program for you. If, on the other hand, your aim is to use a variety of hotel loyalty programs to give you a mix of good benefits, free nights, and good discounts on future stays then I think IHG Rewards can play its part – you just have to be prepared to buy the points that you need (rather then make an effort to earn them) and you have to be prepared to view IHG Rewards Points as a tool to get a discount on the cash rate rather than a currency that offers a path to free nights.
This may not be a strategy that will work for everyone, but I’m pretty sure it’s a strategy that will work well for a substantial number of people.