The corporations that dominate the world responded to the aftermath of the pandemic downturn in their own ways, but there's a common impulse among most of them: recover as much lost income as possible.
Since the world opened back up, businesses have been hell-bent on making back the money they missed, even if doing so puts the squeeze on consumers. That has meant flagrant price increases (contributing to inflation), curtailed services (remember when hotels supplied housekeeping daily?), smaller staffs, and customers getting less for their money (such as reduced portion sizes at restaurants).
Loyalty programs are proving to be an especially tempting target for cutbacks. Across industries, points just don't go as far as they did before Covid floated into our lives.
Some examples: Last spring, Marriott began rolling out a switch of its hotel redemption rates from predictable categories to dynamic rates, resulting in an increase in award prices.
Chipotle points are also worth less—as of October, a burrito that was redeemable for 1,400 points now requires 1,625 points, increasing how much you have to spend to get one.
Dunkin' points used to get you a free coffee after around $40 or so in spending. As of last month, it takes $50.
Exacerbating the weakened loyalty market, customers who were sitting on piles of points during the shutdowns emerged from isolation eager to spend their points, and that sudden influx of redemptions further threatened cash flow for businesses.
In air travel, the high number of customers trying to cash in miles has resulted in demand for award seats outstripping supply, leading to post-pandemic inflation for points redemption. That's why even though the major airlines haven't explicitly rolled out new schemes to devalue miles, it often costs more of them to book a free flight. To get the most from your miles these days, you have to book many months ahead.
Limiting options and inventory further, many airlines are cutting off some of their redemption partnerships.
Change is in the air. Corporate flacks try to spin alterations to their loyalty programs as somehow advantageous for you (the president of Dunkin' even implied customers were begging for the switch), but trends show that loyalty goalposts are being moved farther away.
Your points savings can be drained of power overnight. "I was 5 points away from a free drink then the next day in the updated app I was over 500 points away from a free drink. That is ridiculous," one Reddit user wrote after the Great Dunkin' Devaluation.
You might have stored your points to use on a rainy day, but companies have their own plans for rainy days, and that often involves weakening the value of your redemptions. You have to make your move before they do.
After all, they already got your money when they gave you the points, so making those worth less gets companies off the hook for giving out more freebies. And that helps make up for pandemic losses.
Rising interest rates and high-flying inflation are warning signs for future belt-tightening by businesses, so get ahead of your redemptions. Don't sit on miles or points. The risk of waiting for an undetermined future date is the risk of finding out too late that your loyalty doesn't go very far anymore.
If you have a stock of miles or points in your cache, whether for flights, hotel nights, or free food, now might be a good time to think about redeeming—before the issuing company succumbs to post-pandemic fiscal temptation and declares your points to be worth less than you bargained for.