Hyatt Gold Passport shifts 89 hotels, or 22 percent of its 411 hotels to higher category award levels effective June 4, 2010. The program adds a new high-end hotel award category 6 containing 20 hotels costing 22,000 points per night. The majority of changes are higher category hotels moving upward. California’s Andaz West Hollywood is the only former top-tier category 5 hotel to drop one level.

There is an outcry over two category leaps like the Grand Hyatt New York and California’s Huntington Beach Hyatt Regency rising from category 4 to category 6. Hotel location, in addition to hotel quality and relative rate, appears to be a major factor in the new award rankings. California sees major award inflation with 10 hotels rising in the upper categories of 4, 5 and 6.

Mitigating the high end changes are 65 hotels (16 percent of Hyatt) moving to lower categories. Category 1 grows as 46 hotels move down, dropping 37.5 percent in award price. Category 1 awards cover 24 percent of Hyatt brand hotels and category 2 comprises another 36 percent in the new charts. Hyatt with 60 percent of all hotels in the two lowest award categories compares favorably to Hilton with fewer than 5 percent or Starwood with fewer than 20 percent of hotels at the two lowest award levels.

Points inflation was predictable

Hyatt Gold Passport is still giving away mid-tier Platinum elite status for the rest of 2010 after a year of instant elite offers and generous fast-track after 15 nights to Diamond elite with its loyalty benefit of four complimentary suite upgrades, each good for up to seven-night stays. Lucrative miles, points and free night bonuses and an announcement of a co-branded credit card launching in summer 2010 may be other factors inflating the Hyatt program.
The award changes come just two months after my InsideFlyer April 2010 hotel loyalty programs analysis revealed Hyatt ranked best award value among major chains. My prior analysis only considered hotel price, award category and base points with elite bonuses. A hotel like the Grand Hyatt San Francisco sees its award value drop by one-third as the cost increases from 12,000 to 18,000 points.

Creating loyalty within a hotel loyalty program

The transparency of Hyatt Gold Passport is a major difference in the category changes announcements made this past year by Hilton and Marriott, and even Starwood’s “no changes” position. Reactions to Hyatt Gold Passport’s hotel award category changes are relatively muted responses.

Hyatt announced award category changes April 29–five weeks before the effective date. All award category changes were posted on the Hyatt Gold Passport Web site. Hyatt showed respect for its loyalty members by allowing the award booking window before changes take effect and alleviating members concerns over award reservations. Hilton and Marriott only released small selections of hotel category changes prior to new award levels being implemented this year.

Hyatt award stays booked before June 4 can be modified for up to 90 days (Sept. 2) using the old award chart level. This allows changes in dates or length of stay for a hotel reservation with stay dates into the first half of 2011 using the older award level.

Points will be automatically refunded for award stays booked by June 4 at hotels dropping in category on that date for subsequent stays.

Gold Passport raises the bar for elite member benefits

Hyatt Gold Passport sets a high standard for hotel loyalty programs.
* Free Internet access at all properties worldwide for all Gold Passport elite members. Marriott limits benefit to Gold and Platinum elites at hotels in the Americas. SPG offers benefit only to Platinum elites.
* Full daily breakfast for Diamond members and up to three other registered guests. Hilton makes you choose between breakfast for two guests, free Internet or elite bonus points as a Gold or Diamond member. Marriott guarantees lounge and continental breakfast for Gold and Platinum.
* 2,500 bonus points when the Regency Club lounge is closed to Diamond member. SPG guarantees Platinum members lounge access, but no defined provision for closed lounges.
* 5,000 points if your guaranteed bed type is not received as Platinum or Diamond elite at a Hyatt Hotel. Hyatt Place and Summerfield Suites offer 2,500 points.
* Suite upgrades using points have better defined rates than Marriott and lower cost than the double points required by SPG. Hilton does not offer suites for points.
* Hyatt Gold Passport allows any two members to combine points for free. Hilton charges $25 per 10,000 points for member account transfers. SPG allows transfers only between members in same household. Marriott allows free transfers between legal spouses and domestic partners.

Gold Passport’s ascendance in the loyalty program world positions Hyatt Hotels for growth. Hopefully other hotel loyalty programs follow Hyatt’s lead.