Back in 2017, Hilton Honors got rid of “award charts” and started to price its award nights flexibly – dynamic award pricing. There does appear to be a loose connection between cash rates and award prices, and many hotels continue to have an informal cap on award pricing. (although this might be changed overnight with no warning)
When the economy / travel was booming, this change was viewed as a way to sneak through devaluations without anybody really noticing. Now that travel is limited – especially in countries that rely heavily on tourism but have closed their borders – we can see how award pricing can drop lower than anybody might have ever imagined.
A great example is the 5-star Conrad hotel in Bangkok, Thailand. Even though it’s not one of the top hotels in Bangkok, or even one of the best Conrad hotels worldwide, it is still an excellent choice for Hilton Honors members visiting Thailand.
You might be inclined to spit out your morning Corn Flakes when you find out that award nights are currently pricing as low as 13,000 points per night!
If you are reading this post from anywhere outside of Thailand, you won’t be able to take advantage because the border is essentially shut. But moreover… you might not even want to!
Even though 13,000 points sounds cheap, the cash rate is a mere $48. Once you add on taxes, etc. you would only pay $57…
Why This is Both Right AND Wrong at the Same Time
If you are somebody who just likes to earn some points from travel and a credit card – to spend on your holidays (wherever and whenever you can get away) – then the dynamic award pricing model means that you can never really go too far wrong. 13,000 points for a free night at a 5-star hotel is amazing.
This is far better than the alternative of a fixed award chart, where a hotel of this quality might charge 40, 50 or 60,000 points per night.
If you do some simple math, you arrive at a “value” of 0.44 cents per point ($57 / 13,000). You could choose to pay $48 + tax ($57), earning points in the process. Or you could spend those 13,000 points. Many so-called “travel hackers” will pay cash because they wouldn’t be getting their 0.5-0.6 cents per Hilton point.
But at a time where room rates are very low, you will therefore struggle to find many hotels meeting your requirements for spending points. And this will result in you accumulating more and more Hilton points. Always a bad idea…
The Bottom Line
Even though Hilton’s dynamic award pricing algorithm is pricing certain award nights unbelievably low, it still isn’t low enough to keep “travel hackers” happy. Great for those who don’t want to think too hard about spending points, bad for those trying to find “excess value” from their points balance…