How do hotel loyalty programmes actually work?
You earn points on qualifying spend and status on qualifying nights, and the two operate separately — which is the first thing to understand, because points are the currency and status is the treatment.
Earning points. Typically a fixed number per unit of eligible spend on the room rate, multiplied by a status bonus, plus promotions. Bookings through third-party sites usually earn nothing and do not count towards status, which is the single most consequential rule and the reason direct booking is pushed so hard.
Earning status. Usually by nights or stays in a calendar year, sometimes by spend, with credit card spend and partner activity contributing in some programmes.
What status is actually worth, in rough order of value: late checkout, which is consistently the most useful and least advertised; room upgrades, subject to availability and usually excluding the best categories; free breakfast, which at a mid-tier hotel is a real cash saving; lounge access; welcome points or amenities; and internet, which is now generally free anyway.
How points are valued. Redemption rates vary enormously by property and date. The useful discipline is to calculate cents or pence per point — divide the cash price by the points required — and compare against your programme's typical value. Redemptions at expensive properties in peak season usually give better value than cheap off-season ones.
The traps:
Devaluation. Programmes change award charts, frequently with little notice, and points held are not protected. Points are a depreciating currency, so earning and holding large balances indefinitely is a poor strategy.
Dynamic pricing, where award costs track cash prices and the bargains disappear.
Expiry after a period of inactivity, avoidable with any qualifying activity.
Resort and destination fees, which are frequently still charged on award stays.
Chasing status by booking stays you did not need, which costs more than the benefits return.
The honest summary: loyalty pays if you travel regularly for work and concentrate your stays. For occasional leisure travel, the best rate usually beats the programme.