As travel loyalty programs have evolved over the last half dozen years, the option to book award rooms or flights with a combination of points and miles has become increasingly common. The upside: Adding more flexibility to a loyalty program makes it easier for anyone to use the service. As Hyatt learned late last month, however, the downside is that “cash + points” transactions can also be difficult to manage.

Until last week, the World of Hyatt loyalty program had a feature that allowed members to book award rooms with cash and points by simply billing members half the typical number of award points for the room and then charging a tiered fee for the rest of the rate, depending on the hotel’s category. What many found out, however, was that many of those combinations created amazingly good deals for many rooms in the hotel’s portfolio, especially when rates were high from events like conferences or holidays.

Revenue, too, was also a problem for the cash + points awards. “It’s about cost savings to the loyalty program, shifting the cost of the rooms from the program to the consumer,” says Gary Leff, who runs the popular View from the Wing blog. “Under the old model Hyatt was paying more to properties than with these new awards.”

Hyatt, it seemed, wasn’t fond of how the revenue portion of that equation was stacking up. As of Nov. 1, it officially changed the way its “cash + points” transactions work, and now charges 50 percent of the typical points per room plus 50 percent of the standard daily rate.

Loopholes like these, for many, are part of the attraction of loyalty programs. But as Hyatt just pointed out (and as the airlines have underscored for years), revenue today is more important than loyalty tomorrow.

UPDATE: This story was updated to include a quote from Gary Leff and highlight cost issues faced by Hyatt.

— Grant Martin, Business of Loyalty Editor

Skift Stories and More Expert Insight

How Air France-KLM’s CEO Wants to Be Like Other Airline Groups: While Air France and KLM are part of the same holding company, they are two very different airlines.

A Lesson in Hotel Loyalty That Goes Beyond Just Points: The hospitality industry can be overly obsessed with trends, the latest shiny technology, and the idea of big data. But an iconic and instructive example of just how the industry is based on people and their effort can be seen with Hector Ruiz, who serves as hotel ambassador for The Carlyle Hotel in New York.

Hyatt’s High Hopes for Two Roads Revealed: It’s a well-known fact that in today’s highly competitive and increasingly consolidated hospitality industry, relatively smaller public hotel companies like Hyatt are seeking ways to add more scale.

Lufthansa’s Low-Cost Subsidiary Blunts Profit: Lufthansa is having problems with its low-cost Eurowings unit, blaming it on Tuesday for a fall in earnings.

La Quinta Payoff: Wyndham Sees Big Revenue Jump From Its Latest Acquisition: Having just become its own public company in June, Wyndham Hotels & Resorts is primarily focused on three things: growing the number of rooms in its system, demonstrating the value of its brands to hotel owners, and integrating its $1.95 billion purchase of La Quinta.

Southwest Airlines Follows Rivals by Making In-Flight Movies Free: Southwest Airlines Co. is giving up on charging for in-flight movies, bowing to feedback from passengers accustomed to not paying on rival carriers.

Istanbul’s New $25 Billion Airport Opens Amid Fanfare: President Recep Tayyip Erdogan opened one of the world’s largest airports on Monday, declaring completion of the first phase of construction a symbol of Turkey’s strength and resilience — and a victory over forces he said are trying to sabotage its economy.

No More Free Breakfast at Hyatt Place If You Don’t Book Direct: Earlier this year, Hyatt announced major changes coming to the Hyatt Place brand’s breakfast program starting Nov. 1. And now, the time has come to for those changes to go into effect.

American Is Letting You Pay to Secure Elite Status for 2019: It’s approaching the end of the year, which means it’s a good time to start looking at your elite mileage balances, deciding which status levels you want to go for, and how you want to earn them.

SUBSCRIBE

Skift Business of Loyalty Editor Grant Martin [gm@skift.com] curates the Skift Business of Loyalty newsletter. Skift emails the newsletter every Monday.

Subscribe to Skift’s Free Business of Loyalty Newsletter

Photo Credit: Hyatt Regency in San Antonio, Texas, on July 9, 2017. Hyatt retooled its "cash + points" award booking calculations. Phil Roeder