Today we’re talking InterContinental Hotels Group and their craptacular loyalty program, IHG Rewards Club. Their award currency is currently the least valuable, on a per-point basis of all hotel award points I keep track of. That would include Choice Privileges, Hilton Honors, World of Hyatt and Marriott Bonvoy. Basically, anyone that’s a partner of the big-three transferable credit card award programs. So yes, even the paste-flavored bran muffin of the hotels and resorts world, Choice, has a more valuable award currency than IHG.
How Much are IHG Rewards Club Points Worth?
As of June 2019, I calculate a value of .29¢ per point. That’s terrible. The fact they’re a one to one transfer partner with Chase, right alongside Marriott and Hyatt makes it laughable.
Because I rarely re-hash this info, now would be a good time to quickly go over my hotel valuation method. I like to keep my method reasonable and repeatable. However, unlike valuing airline miles, I don’t take a lowest-cost-cash-price approach. That’s because an airline route is semi-generic whereas a hotel is not. Every hotel will have some unique combination of location, amenities, quality, etc. that will set it apart from even the property right next door.
I have a standard basket of cities, New York, Austin, Rome, Seoul, Bangkok, Toronto, London, Beijing, Los Angeles and San Juan, Puerto Rico. I then look at the cash price of a full-week stay booked both 30 and 90 days in advance. Finally, this is divided by the number of points required for an award stay.
Here is where it can get a little controversial. If a property is bookable with cash, but not with points, then I assign a value of 0 for that particular location and date data point. I do this, because to my way of thinking, if a point is not usable, then it is effectively worthless.
Some people will disagree with that method. And I won’t say they’re wrong, but it’s just now how I see it. Nevertheless, for them, I also publish a non-zero average. This number only looks at data points with award availability, thus ignoring zeros and I don’t further discount.
In the case of IHG Rewards Club, their 30 day’s advance booking non-zero average was .4¢, their 90 days advance was .52¢ for an average of .46¢.
IHG Rewards Club Award Night Availability
So, 0.46¢ when we exclude zeros and 0.29¢ when we include them. When this happens, we can immediately infer one thing. IHG Rewards Club has poor award availability. 68.42% to be exact. When looking for an award stay, one will frequently be met with the following message: “No Reward Nights Available”. Which is very odd because they claim that one benefit available to all IHG Rewards Club members is a lack of award blackouts.
IHG Rewards Club Compared to Peers
Compared to other hotel award currencies I track, IHG Rewards Club points are only rivaled in terribleness by Hilton Honors. The latter being worth .35¢ each. From there, we only go up. Choice Privileges points are worth .71¢ each, Marriott Bonvoy 1.11 and the most-valuable, World of Hyatt comes in at 1.38¢ per point.
Let’s talk about those last two for a minute. I find it very weird that Chase considers IHG Rewards Club points broadly similar to the far more valuable Marriott or Hyatt award currencies. I draw this conclusion based on the fact all currently transfer at a rate of 1:1. Very odd.
The Best and Worst I Could do
The absolute best redemption I could find, came from a week-long stay at the InterContinental London Park Lane. This was offered for $3,283 in cash or 420,000 points. This works out to a redemption value of .78¢.
On the other hand, the worst we could do, excluding the zeros that result from findings of no availability was for a week-long stay at the InterContinental Sydney. It was being advertised for $1,055.33 or 390,000 points. This makes our redemption value just .27¢ per point.
One could easily redeem at a rate at least 3 times better by transferring Ultimate Rewards to World of Hyatt or Marriott Bonvoy. Alternatively, last time I evaluated United MileagePlus, another Chase transfer partner, my best redemption was a business-class flight between Dallas and Hong Kong with a redemption rate of 9.34¢. In other words, 12x the best we could do at IHG. The bottom line, is that I can think of almost no scenario in which one would logically convert a valuable Ultimate Reward into a low-value IHG Rewards Club Point. These vast discrepancies in per-point value are why it’s so important to consider both the earn and the burn side of the return on spend equation.
IHG Rewards Club Points Value Distribution
The last thing I always like to run over when we’re talking about an award currency’s per-point value is its normal distribution, or bell curve. This give us an idea of where our likely redemption values will fall. When plotting IHG Rewards Club’s distribution, we get a relatively steep curve. This isn’t necessarily a bad thing, providing the average is respectable. What this means is that most hypothetical redemptions are likely to fall in a relatively narrow band of values.
Going one standard deviation in either direction tells us that statistically, about 68% of all redemptions should fall between .08 and .55¢. Worth noting, is that values on this chart take into account zeros, aka findings of no availability but are not otherwise discounted. In other words, it’s a straight mean.
Because the average value of an IHG Rewards Club point value is so pathetic, this is overall a very poor showing. Let’s for a moment compare to United. Here, our bell curve is wider and hypothetical redemptions are not tightly bound. What this tells is that one has an outside, but realistic, chance of an ultra-high value award redemption.
How Properties are Priced
Like most hotel loyalty programs, IHG Rewards Club operates on a set-point schedule. Meaning each property in their network will cost a pre-set amount of points. This means one’s best redemptions occur when rates are highest. Think the summer travel season for resort destinations, at least in the Northern Hemisphere.[wpdatatable id=34]
Elite status, like much of the program overall, is a little wonky to describe. At its most basic level, it has four, what I’ll refer to as, normal tiers. Club member, Gold, Platinum and Spire. See the chart above for granular differences.
I mentioned a moment ago that the program is a bit on the wonky side of the spectrum. That’s because above, and to some degree below all the aforementioned status tiers, we have InterContinental Ambassador. It’s at the top because it has benefits like guaranteed room upgrades and free weekend nights, a perk exclusive to this status. However, it’s sort of at the bottom because anyone can get it for the relatively reasonable price of $200 or 40,000 points. Included in this pay to play package is automatic Platinum Status. So, what we’ve actually got is an elite tier that you buy, that actually gives you another status that would otherwise be had after 40 paid nights a year. Thinking about that makes my head hurt.
It also makes me wonder, why would anyone be particularly loyal to IHG when the price of admission is otherwise so low. Let’s face it, most people want status for the room upgrades and sometimes extended check-in/out hours. In my opinion, most other benefits fall into the “doesn’t excite me at all” mental bucket. I guess what I’m saying, is that 40 nights is a lot of nights, especially for the non-hardcore business traveler, like me. I have no brand loyalty when it comes to hotels. They’re all just big faceless corporations that don’t actually care about you. It’s not like you’re supporting a local business whose owner it just trying to make ends meet. Every major hotel conglomerate has some trash properties and some beautiful ones. It would make no sense to go out of my way to spend that much time at a certain company’s properties when I could get the same results by spending $200 one time.
How to Earn
If there is one redeeming quality about IHG Rewards Club it’s the fact that points are relatively easy to earn. One gets a base 10 points per dollar at most properties and 5 at Staybridge and Candlewood Suites. This goes up to 20 and 10 points per dollar if you’re a Spire Elite due to the points earning bonus.
Just for fun, let’s compare earn on spend at IHG Properties and those under the Hyatt umbrella. To really make it exciting, let’s assume one is a Spire Elite at IHG and has no status at Hyatt. Because of our status, we’re earning 20 points per dollar worth .29¢ each, or a return of 5.8%. Over at World of Hyatt we’ll earn 5 points per dollar, but they’re worth 1.4¢ each. This gives us a return on spend of 7%. In other words, top tier elites at IHG earn less than anyone does over at Hyatt.
The IHG Rewards Club Premier from Chase
In addition to the traditional points on stays, Chase offers a co-branded credit card, the IHG Rewards Club Premier. It’s currently offering a signup bonus of 80,000 points worth $232 at current valuations. In addition, one gets automatic Platinum elite status, a free anniversary night and the fourth night free on award stays. Considering this card only costs $89, it’s actually a pretty good value. It, along with my United Explorer, are great candidates for sock drawer cards. The Chase IHG Rewards Club Premier advertises 25x points per dollar spent at IHG properties, but I feel this is a bit misleading. In reality, one gets 10 points from the card, and the other 15 from being an IHG Platinum Member. Non-IHG spend earns 2 points per dollar on gas stations, grocery stores and restaurants plus 1 point per dollar on everything else, making this card about as worthless as one can be as an everyday spender.
Other Way to Earn
Finally, we’ve got some oddball ways to earn that most people, including myself will never use. Things like bonus points on Apple purchases, points for consumer surveys and restaurant partners. Their Greener Stay program awards 500 points if one declines housekeeping. So that’s an option if clean sheets and towels aren’t worth $1.45 to you.
Overall, IHG Rewards Club is a loyalty program that doesn’t at all excite me. Their points are the least valuable of any that I track. The fact that Platinum Elite Status can be bought for $200 or acquired via ones Chase IHG Rewards Club Premier Credit card means that brand-loyalty really doesn’t pay off. If one is so inclined to stockpile hotel points over generally more valuable transferable ones, I’d say stick with Hyatt or Marriott.
That said, I do like Chase’s co-branded card offering, if for no other reason than the fact that $89 buys you status and the annual free night pays for the card.