Marriott CEO Anthony Capuano revealed some details about the evolving economics of the Marriott Bonvoy program. While they’re probably necessary from the perspective of hotel owners, this is something that members should be worried about…
Marriott charges hotels less for points, pays them more for redemptions
During Marriott’s Q2 2026 earnings call, the company’s CEO made some interesting comments that could impact Marriott Bonvoy members, including this one:
“At the beginning of the year, we lowered loyalty charge-out rates across our global system by roughly 5% to what we believe are the lowest in the industry across all chain scales. In addition, earlier this year, we enhanced owner reimbursement for Bonvoy redemption stays on high-demand nights. We have also introduced streamlined brand standards, which simplify operations and reduce costs, and we have rolled out flexible renovation scopes that focus on customer-facing elements of the hotels.”
Just to simplify that even more:
- When you stay at a Marriott you’re issued Bonvoy points (assuming you’re a member), and that’s funded by the loyalty charges that Marriott bills hotels, which are a percent of revenue; Marriott has just lowered those fees by 5%, to give hotel owners some relief, and claims it now has the lowest fees in the industry
- When you redeem points, the amount the hotel is reimbursed varies based on how full the hotel is, and Marriott has reportedly increased reimbursement for hotels when the properties are quite full
- Also, not directly related to Bonvoy, but Marriott is reducing brand standards, to give hotel owners more flexibility, so that’s not great in terms of consistency
All of these updates won’t be good for Bonvoy members
Let’s be clear here — Marriott centrally controls the value of Bonvoy points and sets award pricing, based on the economics of the program. With these latest changes, Marriott is taking in less money from individual hotels for awarding points, and is increasing the amount that hotels are paid when members redeem points.
Do we think Marriott is just willing to eat all of those costs, and greatly reduce its margins? That seems highly unlikely for a publicly traded company. Instead, this almost certainly points to the continued devaluation of Bonvoy points, particularly for redemptions at hotels when they’re close to being at capacity. Since Marriott doesn’t publish award charts, expect continued devaluations… which you’d expect either way.
Admittedly none of this is surprising. A couple of months ago I wrote about how Marriott hotel owners came together to demand more money for award stays. They felt like Marriott was using the Bonvoy program to centrally boost its profits, essentially at the cost of individual hotel owners. So I do think that Marriott had to make things more compelling for owners. For that matter, this matches the industry trend, as Hilton Honors is providing similar relief to hotel owners.
So, what is Marriott telling investors to make them more optimistic about this situation? They’re pointing out the continued growth of the Bonvoy program, as it now has 295 million members (up from 200 million in early 2024, so the growth rate is wild).
Jen Mason, the company’s CFO, noted how the co-brand cards will be undergoing a refresh, and that’s expected to help margins as well (again, probably not great for actual members):
“The benefit to the loyalty program and to our fees from our new U.S. co-branded card deals is expected to build over time as new and refreshed U.S. card products with new cardholder benefits are introduced, supporting anticipated growth in new accounts and cardholder spend.”
Bottom line
Marriott’s CEO made some interesting comments about the Bonvoy program during the company’s Q2 2026 earnings call. Specifically, he indicated that the company has dropped loyalty fees for hotel owners by around 5%, and on top of that, has increased reimbursement fees for hotel owners for award stays at nearly full properties.
Obviously this materially cuts into the margins of the program, but I’m sure it won’t be Marriott taking the loss on this, but instead, members.
What do you make of these comments from Marriott’s CEO?