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Alaska Airlines has announced that it has expanded its existing arrangement with Rocketmiles to allow Mileage Plan members to book hotel nights using their Alaska Miles.
Travelers have been able to earn Alaska Miles on their Rocketmiles bookings for as long as I can remember but this is the first time that travelers have been able to use Alaska Miles in lieu of cash when making a reservation.
Here’s what Alaska had to say in its announcement:
“With the launch of mileageplanhotels.com, Mileage Plan members can choose to earn up to 10,000 Mileage Plan miles for every night of their stay, use their miles, or a combination of cash and miles, to book brand name hotels, boutique properties and resorts.”
According to Ryan Butz (Alaska’s managing director of loyalty) the ability to use Alaska Miles to book hotels was “among the most requested enhancements to Mileage Plan” so, although I’m more than a little sceptical of that statement of fact, apparently quite a few people should be happy with this news….but are the deals any good?
What Value Do You Get?
I picked a random date in July and decided to see what Alaska’s new partnership with Rocketmiles would offer me. These were the first two properties I saw:
If I was happy to pay for the same night with cash Rocketmiles was offering the JW Marriott for $1,131.50 including all taxes and fees and was offering a 10,000 mile bonus as well:
A like for like comparison of the two would therefore be $1,131.50 cash or 75,500 Alaska Miles for the night meaning that I would be getting ~1.5 cents of value out of each Alaska Mile.
That, however, isn’t quite the end of the math as the Marriott website is offering a post-tax AAA rate of $1,074.90 for the same night:
….so, given the choice of paying $1,074.90 or 65,500 Alaska Miles means that I would be getting ~1.65 cents of value per mile….and that’s surprising.
I would have expected Marriott’s rate to be net better than the one offered by Rocketmiles but, because Rocketmiles is offering such a big miles incentive when you book with cash, it’s actually the Rocketmiles rate that’s net better.
1.5 cents per mile isn’t exactly great value for Alaska Miles but it’s actually a considerably better rate than I was expecting to see.
Applying the same process to a booking at the Sheraton Grand shows that Rocketmiles is selling the same room for $613.67 after tax and is offering a 10,000 mile bonus too.
A like for like comparison of the two would therefore be $613.67 cash or 62,100 Alaska Miles for the night meaning that I would be getting ~1.0 cent of value out of each Alaska Mile.
The best rate I could find on SPG.com for the same night was $593 including all taxes…..
…meaning that, based on this rate, using Alaska Miles for this booking would get me ~1.14 cents of value out of each Alaska Mile.
The figures for the Sheraton are more like what I was expecting to see before I started out this exercise and, unless you have more Alaska Miles than you know how to use, are a very good example of a poor use of miles.
I didn’t stop my research there and I checked out quite a few more hotels just to see what sort of range of values was on offer – it was broad.
I found properties where using miles would only get me a little over 0.7 cents/mile in value (Peninsula Chicago), properties closer to 0.9 cents/mile (Hotel Chicago Downtown) and a few around 1.2 cents and 1.4 cents/mile.
I didn’t manage to replicate the 1.5 cents of value the JW Marriott at LA Live is offering.
Thoughts
As always, math is key here.
The number of bonus miles Rocketmiles is prepared to offer on a hotel night can really skew the value proposition so you have to be careful how you work out the numbers.
I can see two scenarios where using Alaska Miles for hotel reservations may work out ok:
- You have a large stack of Alaska Miles and you can get between 1.4 and 1.5 cents of value out of them by booking a hotel – not a great redemption but if you have more miles than you know what to do with why part with cash if you don’t have to?
- You have a low number of Alaska Miles with little chance of adding to the balance any time soon – paying (or part-paying) for a hotel room with the limited number of Alaska Miles you have could be a good way of getting rid of a mileage balance that would otherwise just sit there and devalue.
Alaska Miles are probably among the more valuable miles out there right now so if you don’t fall in to one of the two categories above (or if you can’t get over 1.5 cents in value) I can’t see how using your miles to book hotels is a sensible thing to do.
What do you guys think?
An Aside
If you’re happy paying the huge sum of money needed to book the JW Marriott in the example I cited earlier, Rocketmiles essentially allows you to buy 10,000 Alaska Miles for $56.60 ($1,131.50 – $1,074.90) which comes out to ~ 0.57 cents/mile. That’s an absolute steal.
