Best Rate Guarantee claims are one of the most lucrative, but challenging, aspects of being a “travel hacker”. In general, all hotel chains claim to have the lowest rates when booking directly. But since they DON’T always offer the lowest rates, Best Rate Guarantee policies are in place to allow members to continue to book direct – necessary for elite status benefits/qualification and points earning – while also taking advantage of the lower rate. Most major hotel chains will add another incentive on top, which is why many travel hackers put substantial effort into finding BRG opportunities to claim.
Hyatt’s version of a Best Rate Guarantee policy is surely one of the most valuable. You can choose between:
- 5,000 points
- a 20% discount on the lower, matched room rate
But which one should you choose?
Step 1 – How Much is 5,000 Points Worth?
Notwithstanding the current “buy points” promotion that is more expensive than usual, I like to use the 1.8 cent price that Hyatt regularly uses when selling points at a discount. After all, if we are choosing between 5,000 points and a discount, we are effectively “buying” 5,000 points.
So… 5,000 points = $90.
Step 2 – Calculating the Added Value of Paying a Higher Room Rate
Let’s look at a simple example where your matched rate is $400 and you must pay 12.5% in taxes, bringing your total cost to $450. You would have the choice of:
- 5,000 points worth $90
- A 20% discount worth $90, bringing your total after-tax cost down to $360 for the room
These options might appear equivalent, especially if you are indifferent between earning more points and receiving a discount. (as long as your valuation metrics are met)
But… a higher room rate means that you will earn MORE points. On the $400 room rate you could earn:
- 5 base points –> 2,000 points
- 1.5 Globalist tier bonus points –> 600 points
- 4 co-branded credit card points –> 1,600 points
- for a total of 4,200 points
If you discount that $400 room by 20%, your rate would become $320, meaning that you could earn:
- 5 base points –> 1,600 points
- 1.5 Globalist tier bonus points –> 480 points
- 4 co-branded credit card points –> 1,280 points
- for a total of 3,360 points
What Does This Mean?
In my example above, if you choose to decline the discount in favor of 5,000 points, you could also earn an extra 840 points, simply because you are paying a higher room rate. (and that’s before any double or triple point promotions)
This means that you would actually be earning 5,840 “extra” points by declining the 20% discount. At our 1.8 cent value, that works out to $105.
As anybody familiar with Microsoft Excel will know, you cannot allow a “circular argument”, where two calculations depend on each other. So here’s where we stop the loop with an easy rule-of-thumb…
If the 20% discount works out to $100 or more, choose the discount… If a 20% discount works out to less than $100, choose the points…
Adjust as appropriate if Hyatt is offering a double or triple point promotion, as you would be even more incentivised to pay a higher room rate and earn even more points.
How Do I Find These Amazing Best Rate Guarantee Opportunities?
In my experience, Hyatt will only regularly accept claims against the two major Online Travel Agency empires:
- Expedia, Hotels.com, etc.
- Priceline, Agoda, Booking.com, etc.
This makes it easier for novices in a way, as you can easily compare rates against the major OTAs by using Google Hotels or Kayak / Trivago. Those obscure Russian or Chinese travel websites are unlikely to be approved, so you don’t need to waste your time…
The Bottom Line
You can read up on Hyatt’s Best Rate Guarantee policy by clicking here.
But the next time you are filling in the Best Rate Guarantee claim form, remember the $100 rule when choosing between points and a discount…
