Analyzing Marriott Bonvoy’s New Dynamic Pricing

Marriott Bonvoy has officially introduced dynamic pricing on award redemptions. They’ve scrapped the old category chart which listed a predictable points price for each property, and have now switched to a more opaque system.

As expected, many hotels have gone up in price. Let’s take stock of the damage and see what sort of value we can get out of the next iteration of the Marriott Bonvoy program.

Rest in Peace, Marriott Bonvoy Hotel Categories

Until recently, Marriott Bonvoy assigned a category to each hotel. For each category, you’d pay a set price depending on whether the night was designated as off-peak, standard, or peak.

As you can see, low-end properties have a modest price variance between, off-peak and peak dates, while high-end properties have more fluctuation.

Also, as you climb the ladder of hotel prestige, there are bigger jumps at higher levels. The price difference between a Category 1 and Category 2 hotel is a pittance, whereas the step from Category 7 to Category 8 could mean the difference between booking one property or the other.

As of March 29, 2022, Marriott Bonvoy has abandoned the category chart and no longer designates a category to each hotel. However, the old framework is still operating behind the scenes as its remnants are visible in the new pricing model, so let’s not forget about it entirely.

The Bad: The Devaluations We Expected

Prior to this year’s devaluation, Marriott Bonvoy published a list of which hotels that would be going up in price. This was a blessed opportunity to lock in some bookings at “never again” rates.

For these hotels, the “minimum and maximum” number of points required went up 5,000, 10,000, 20,000, or 30,000 points. In other words, this roughly corresponds to a category increase: low-end properties went up less, and high-end properties went up more.

In particular, quite a few luxury properties, both city hotels and resort destinations, went up significantly. That’s a sign that they were probably underpriced to begin with – which means they offered outstanding value at the old rates.

I made a handful of luxury bookings before the new prices kicked in, all of which have gone up in price.

Old Category 5: JW Marriott Phu Quoc Emerald Bay

For a Vietnam trip in the fall, I locked in five nights at the Category 5 JW Marriott Phu Quoc for 145,000 points. Mostly at standard pricing with one peak night mixed in, that property was usually going for 35,000 points per night.

Now, prices are showing 48,000–54,000 points per night on most nights throughout all seasons, creeping as high as 60,000 points per night on select dates. This corresponds to the old Category 6 rates of 40,000–60,000 points.

Le Méridien Maldives is another one with basically the same story: old Category 5 for 30,000–40,000 points, now going for old Category 6 rates, heavily leaning towards the peak side and with extremely seasonal variability.

Old Category 7: Bodrum EDITION

I booked five nights at the Bodrum EDITION. Formerly a Category 7 hotel, I found a block of off-peak nights in May for 200,000 points.

Now, a similar booking would cost 320,000 points for five nights, a 60% increase! Surely that booking was severely undervalued by Marriott Bonvoy prior to the recent changes.

As Marriott had signalled, the Bodrum EDITION is charging up to 30,000 more points per night. This hotel is now going for 70,000–100,000 points per night, equivalent to an old Category 8 hotel.

However, prices on the low end are very hard to find, and you’ll see heavy peak pricing in peak season.

Old Category 8: Al Maha

A popular bucket list item for many award travellers, I’ll be going there twice in the coming year.

Prices for the old Category 8 hotel are now 80,000–120,000 points. However, you’ll only find prices in the old sub-100,000-point range outside of peak season, when it’s prohibitively hot to visit a desert retreat in the Persian Gulf.

Similarly, the St. Regis Maldives Vommuli has gone up to the same range, rarely dipping below 100,000 points and showing strong seasonal pricing patterns.

Interestingly, none of the old Category 8 properties actually increased by 30,000 points – the most they went up is 20,000 points, at worst a 20% increase.

This puts a soft cap on the current award chart at 120,000 points, and creates what I’ll call a “shadow Category 9” in the range of 80,000–120,000 points.

Compared to the devaluations on other parts of the chart, that’s actually quite reasonable. Considering the cash rates for these properties, there’s still exceptional value here, and I’d have no problem using 120,000 points per night for what I’d get for a stay at some of these locations.

The Good: Most Hotels Cost the Same As Before

Aside from the forewarned price increases, no other hotels changed their price range. No properties went down a “category,” but let’s be honest, were we expecting them to?

Instead, there are two changes to note.

First, rather than three discrete price levels, an award night might cost anywhere within the previous range. Prices are now generally in increments of 1,000 points, although I have seen some 500-point increments at the low and high ends.

For example, old Category 5 hotels may show prices of 30,000, 31,000, 32,000 points, and so on, up to 40,000 points. This means there’s quite a bit more variance from day to day.

If you used to use your 35,000-point certificates from the Marriott Bonvoy American Express Card on Category 5 hotels, it’ll be harder to nail a “perfect” 35,000-point redemption with them, as you can see in the following dynamic calendar for the JW Marriott Edmonton ICE District:

You might settle for a 33,000-point night that fits with your travel plans, and soon you’ll be able to top up a certificate with points to hit those awkward 37,000-point nights that we’ll now see.

Second, with no more official “peak pricing,” there’s no more guarantee that Marriott Bonvoy will limit the number of dates on which they charge peak rates. Anecdotally, I’d say that overall it feels like there are more dates coming in on the high end of each hotel’s range, especially for luxury properties.

However, there are some hotels showing ample pricing below the old standard rates. Check your old bookings and see if the points price has gone down – you might find some savings, even if it’s just a few thousand points.

Even my favourite “mattress running” property, the Four Points by Sheraton Edmonton South, hasn’t been entirely immune to a slight price increase, but is still very much within an acceptable range.

Finally, it looks like PointSavers is still a thing, although I’m not sure how relevant it is in the absence of an official award chart.

I guess I’ll call the Courtyard Phnom Penh a “Category 1.5” from now on, with a range of 8,000–12,000 points that doesn’t really line up with anything.

Deconstructing Dynamic Points Prices

We’ve identified that the old category system still plays a role behind the scenes to some degree, but the off-peak/standard/peak distinction is no more.

With granular price levels, award costs can be all over the place for adjacent dates. Thus, we must ask, is there any rhyme or reason to the new dynamic prices?

Let’s look at an old standby, the JW Marriott Parq Vancouver. The hotel has bounced between Category 5 and 7 since it opened its doors, now landing at the price point formerly known as Category 7, ranging between 50,000 and 70,000 points per night.

During peak season mid-summer, the popular accommodation is almost universally priced at the high end of its range, with a couple of oddball dates priced lower towards the end of the month. Do these line up with cash prices?

I’m not so sure. There are a couple of weekends at a lower cash price, but a high points price. And the cheaper points dates are the same cash price as the dates all around them.

If we look at October, again we’ll see mostly uniform cash rates, with points rates all over the place. Note in particular the discrepancy between Monday the 3rd and Monday the 10th.

But there are some clues that cash and points prices move in tandem, at least to some degree. The week in early August charging more than $600 per night does line up with a higher points price – of 70,000 per night instead of the usual 68,000.

I suspect there may be a range of normal cash prices that form the bounds of the property’s 52,000 and 68,000 points prices, with a slight margin for extreme outliers.

I imagine points pricing is driven by occupancy to some degree – maybe not precisely the same way that cash rates are determined, but I’m sure it’s a factor for both. Here, you can see the Medellin Marriott Hotel charging “off-peak” Category 4 rates as they try to fill next week’s distressed inventory, whereas the entire rest of its calendar is a smidge higher.

Ultimately, however, it seems there’s still an element of designating nights as points-peak and points-off-peak under the hood by some subjective measure, somewhat independently from how cash rates are determined, except now it’s within a more variable range.

The Future of Marriott Bonvoy Dynamic Pricing

Since the Marriott and SPG loyalty programs merged, Marriott Bonvoy has shuffled their hotel categories every year.

This year’s shuffle is taking a big step in the wrong direction. While not much has changed structurally, Marriott Bonvoy has moved those structures behind the curtain.

Thankfully, they’d committed to only raising the prices on certain hotels for 2022, and they announced in advance how much those price increases would be. While an unwelcome move, it’s a somewhat surprising level of transparency.

However, this move is the precursor to a much more significant change to the program coming in 2023. We’re anticipating that the award chart will be uncapped, with no limit to how expensive some properties may be to book on points.

When there are no clear rules as to how an award program is priced, it becomes very hard for its members to use it effectively and find nuggets of value.

We’ve seen programs like Hilton Honors and Delta SkyMiles move to fully opaque dynamic pricing, and in doing so those programs have fallen out of favour in the eyes of many former loyalists.

I’m optimistic that Marriott Bonvoy will retain some semblance of sensibility to their award prices. They’re an established brand with an industry-leading footprint, and they ought to know that gutting the program would only lead to them bleeding members.

Although they’re a step in the wrong direction, this year’s changes are somewhat mild. I hope it’s a sign that Marriott Bonvoy will continue to look for ways to provide value for their members going forward. 

Conclusion

All things considered, Marriott Bonvoy‘s dynamic pricing for 2022 is not as catastrophic as I’d feared. Overall, I’d say the high end still offers great value even with a devaluation, the mid-range has improved in some cases, and the low end doesn’t leave much of an impression either way.

I’m very happy to have made a few speculative bookings, all of which have gone up in price significantly. However, many of the affected properties still offer top-notch cents-per-point value if you were to book today at a higher points cost.

I’m also pleased to see that many other properties haven’t changed significantly. Some land on the high end of their range more often, but that always felt like the case, despite Marriott Bonvoy’s previous pledge to limit the number of peak dates. Others have benefitted from a more granular pricing scale on the low end.

For now, it appears as if dynamic pricing is little more than a familiar category adjustment behind the scenes. Next year, we’ll find out if Marriott Bonvoy intends to keep providing strong value for aspirational travellers, or if 2022’s changes are merely a soft landing for truly unrestrained dynamic award pricing.