2021 World of Hyatt category changes - Not Too Bad...

by Neil McPherson

16 February 2020.
14 March 2020 - updated to reflect introduction being deferred until July 2021.

This article is based on World of Hyatt Terms and Conditions dated 25 November 2020.
To save sifting through all the T&C's, for key details on the program and what they mean for you, please refer to our World of Hyatt guide.

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Introduction

It’s around this time each year that Hyatt (and others) update the categories of their properties and/or the points required per reward night for those categories. For the 2020 World of Hyatt category changes, I hoped that the changes would be relatively light, given the move (in a small way, initally at least) into peak/off-peak pricing (see Hyatt peak pricing announcement).

From 22 March, 216 of the approximately 1,400 properties participating in World of Hyatt were to change categories.

World of Hyatt announced in early March that due to the Covid-19 virus crisis, it is deferring the recategorisation of properties until 2021, with 5 exceptions which will still be effective from 22 March 2020:

• The Hyatt Centric Park City will move from Category 6 to Category 7
• The Park Hyatt Mallorca will move from Category 6 to Category 5
• The Park Hyatt Shenzhen will move from Category 4 to Category 5
• The Park Hyatt Ningbo will move from Category 3 to Category 4
• The Alila Yangshuo will move from Category 4 to Category 5

By comparison, the original announcement was for about half the proportion of changes being made under the larger Marriott Bonvoy program.  

Assuming the changes will remain the same when introduced in 2021, the following remains accurate.  But we won't really know until next year.

In their original February 2020 announcement, World of Hyatt noted that:

• No new Categories have been added, and the points required for each Category will remain the same.
• When you book before March 22, your reservations will follow the current "Standard" pricing in the Hyatt free night award chart.
• Reservations made on or after March 22 will follow the new free night award chart and incorporate the updates noted below
• Existing reservations for nights on or after March 22 will receive a refund for the point difference if the hotel moved to a lower category.

Overview

The movements within the Hyatt category changes are fairly even, so it’s mostly a rebalancing, with only a slight overweighting towards higher categories (116 increases vs 100 decreases).

The changes aren't too concentrated either. There are movements up and down for both lower and higher category properties.

There is a concentration of movements within the brands, however.

Read more to see where the category changes will occur and how they may affect your plans.

What is the impact of the changes?

The complete list of 2020 World of Hyatt Award Chart changes is no longer available on Hyatt's website.  

Assuming the changes will remain the same when (re)introduced as the 2021 World of Hyatt Award Chart changes, the following remains true. 

The changes affect 216 (or 15%) of participating properties in total, of which there are almost the same number of increases (116) as decreases (100), or 1.16 times as many increases as decreases - a far cry from Marriott's ratio of 3.26 times.

Categories with most change

The moves across categories seem quite fair. There will be an overall increase in category 1 and decreases in both categories 2 and 3.

The number of properties in category 4 doesn't change, with

• the number of properties moving up from category 4 into 5 (21) exactly matched by the number moving up into category 4 from 3.
• the number of properties moving down from category 5 into 4 (17) was exactly matched by the number moving down from category 4 into 3.

So Hyatt has ensured that members with free night certificates seeking to maximise their value will have

1. the same number of properties to choose from when they come to redeem them;
2. roughly the same "quality" of properties to choose from with only 4 more "ex category 3 properties" than "ex category 5 properties" joining category 4.

Similarly, other properties moving down from category 6 are also "topping up" category 5, while other move up from category 6 to 7 (which has no change in numbers overall).

Category 8, with the highest points requirement, will have the largest increase in property numbers (13), indicating movement among the higher luxury/premium brands and locations. The category with the second-largest increase in property numbers is Category 1 (with an increase by 12) - almost even-handed increases at both ends of the price range.

Chart 1 - February 2020 Hyatt category changes - number of properties by category

Brands most affected

Fans of the premium and luxury Hyatt-branded properties will be pleased. Park Hyatt, Hyatt Regency and Grand Hyatt have had more properties re-classified lower than higher (by 4, 5 and 6 respectively).

The brand affected the most by moves upwards is SLH (36 upwards and 26 downwards, so an increase by 10 overall). This is perhaps the most interesting move for two reasons:

• it may be indicative of a re-positioning of SLH against its own luxury brands;
• SLH properties are also able to be booked directly, so will some members' stays move to outside the World of Hyatt ecosystem where World of Hyatt points and tier bonuses won't be earned?

The brands with other significant upward moves are Hyatt House (9) and Hyatt Place (5).
Smaller increases occurred with Alila (only 1 change - upwards) and Destination Hotels (only 2 changes - both upwards), which appear to be solely adjustments.

The all-inclusive, resorts oriented brands of Miraval (luxury resorts and spas), Hyatt Ziva (family-oriented) and Hyatt Zilara (adults only) had no changes made to the properties' categories.


Chart 2 - February 2020 Hyatt category changes - change in number of properties by brand

Regions most affected

Only two regions had significantly more properties re-classified to higher categories than lower ones - North America (by 35) and Africa (by 4). North America has by far the most properties, so perhaps the extent of change there is no surprise.

The regions with the largest number of properties re-classified into a lower cost category are Latin America & Caribbean and the Middle East (both 7 more). American holiday-makers heading south may find some surprising bargains.

Oceania is another surprise. It has 5 changes, all re-classifications downwards, including the Melbourne Park Hyatt (from category 5 to 4) - creating some bargains for Australian stays in particular.

Continental Europe (or the "new EU") was reasonably balanced in rises and falls, but the UK has 10 changes, of which 8 are decreases:

• the Hyatt Places at Heathrow and West London;
• the Hyatt Regency Birmingham; and
• 5 SLH properties, including Cromlix in Scotland (from category 7 to 6).

and 2 are increases (both SLH properties)

• Langshott Manor and
• The Fish Hotel.

Table 1 - February 2020 Hyatt category changes - number of properties by region

Airport Hotels - moves affecting "road warriors"

Hyatt Place Heathrow wasn't the only Hyatt airport hotel to move categories.

Hyatt airport hotels that moved to lower pricing categories included:

• Hyatt Place London Heathrow Airport (category 2 to 1)
• Hyatt Regency Charles de Gaulle (category 2 to 1)
• Hyatt Place Frankfurt Airport (category 2 to 1)
• Hyatt Place Salt Lake City Airport (category 2 to 1)

For European trips, the Hyatt Regency at Charles de Gaulle (CDG) Airport (4 stars, modern) now looks very attractively priced.

But some Hyatt airport hotels moved to higher pricing categories (all located in USA):

• Hyatt Place La Guardia Airport (category 3 to 4)
• Hyatt Regency Orlando Airport (category 3 to 4)
• Hyatt Regency John Wayne Airport (category 2 to 3)
• Hyatt House John Wayne Airport (category 2 to 3)
• Hyatt Place Indianapolis Airport (category 1 to 2)
• Hyatt Place Cincinnati Airport (category 1 to 2)
• Hyatt Place Austin Airport (category 1 to 2)

Observations

The increased cost from the 2020 Hyatt category changes is not too bad - pretty even handed across categories and locations, but with an adjustment between top-tier Hyatt-owned properties and those of the SLH alliance.

The table below shows how significant the increased cost (in points) will be when you redeem your hard-earned points.  For a category 3 property moving to category 4, the increase in peak season is "only" 20% compared to 2019. For most other single category increases, the rise is 20% to 33% with 1/3 being more than 33%.

Table 2 - Points Only - cost impact of moving up a single category

On the other hand, there are a number of movements that will result in savings at some properties. The table below shows how significant the cost savings (in points) will be when you redeem after March 22.

If your favourite property has moved down a category, your stay in 2020 could be up 46% cheaper than last year, with many savings in the 17% to 25% range.

Table 3 - Points Only - savings from moving down a single category

If you are looking for a property that is minimally affected by peak/off-peak pricing, categories 4 and 5 look to be the best.  Coincidentally,

• category 4 has had no change in the number of properties from which to select (still a good number of options for certificate holders);
• category 5 has had an increase in the supply of properties.

What should you do?

1. Pay for future planned booking(s) in full before March 22 with existing points if the property is being re-classified upwards.


2. Points + Cash may become more relevant to lock in additional holidays, prior to the price increases from March 22nd.

Combining Points + Cash requires 50% of the points required for a free night and 50% of the Standard Rate. Starting March 22 when you combine Points + Cash, you can save 50% of the points required for a free night and 50 -70% off the Standard Rate for a Standard Room.

3. Generally, if you were considering any "aspirational stays" you should also book now to avoid the increased points requirements for free nights. However most aspirational Hyatt properties are unaffected (Park Hyatt Maldives Hadahaa, Park Hyatt Paris-Vendôme, Park Hyatt Sydney)

The main exception and one to book now in my view is:

• the Grand Hyatt Tokyo (category 6 to7).

The aspirational SLH properties did not fare so well.  The following are all going to rise after March 22 and so should be booked before then. Alternatively, look at booking direct with SLH - you won't get Hyatt points or tier benefits, but the cash price may be cheaper.

• Viceroy Bali (category 7 to8).
• 137 Pillars, Chiang Mai (category 6 to7).
• Cape Fahn Hotel (category 5 to 6).

4. No need to worry if you have already booked for a property which is going to fall in category, as Hyatt states on the page announcing the changes that "Existing reservations for nights on or after March 22 will receive a refund for the point difference if the hotel moved to a lower category".

5. If you have not yet booked the following, better to wait until after March 22:

• Park Hyatt, Mallorca (category 6 to 5).
• The Fortress Resort and Spa, Sri Lanka  (category 6 to 5).

Conclusions

In my view, the changes are not too bad:

• reasonably even-handed,
• minimal number of aspirational properties adversely affected
• more than a month's notice provided.

The main "losers" in the changes are SLH properties (more have moved to higher priced categories) and some  US based airport hotels.

It is interesting to contrast the approaches of World of Hyatt and Marriott Bonvoy for their moves to peak/off-peak pricing and their first awards reclassification following it. In both instances, World of Hyatt's changes have been more member-friendly than those of Marriott Bonvoy.

World of Hyatt has historically been seen as a very good loyalty program, especially for upper-tier members, but limited by a small footprint of properties. The recent alliance with SLH (earn and redeem World of Hyatt points with SLH property stays) and the acquisition of Alila and other brands within Two Roads Hospitality will lessen this concern, while strengthening its presence in the wellness space and appeal to high-end travellers.

Following these reasonably member-friendly changes, World of Hyatt is looking very attractive.

The changes to the World of Hyatt program will surely be reason to attract members of other loyalty/rewards programs, particularly Marriott Bonvoy members given the treatment they receive.

I suspect one of the reasons a mass movement hasn't occurred yet is Hyatt's very limited status-matching program.

If only there was a Hyatt-badged credit card available in Australia or the UK...

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