Marriott Faces $3.99B Loyalty Liability as Points Gap Grows $473M
At year-end, Marriott recorded $3.99 billion in unredeemed loyalty points liabilities while Hilton reported $2.91 billion, part of a collective $11.6 billion owed by the top seven hotel groups. Marriott’s points gap widened by $473 million last year as co-branded credit card signups surged, boosting deferred revenue.
1. Loyalty Liabilities Totals
By December 31, the leading seven hotel groups held $11.6 billion in unredeemed points liabilities, with Marriott owing $3.99 billion and Hilton $2.91 billion. Marriott’s 271 million members and Hilton’s 243 million membership counts underscore similar scale but differing loyalty issuance.
2. Drivers of Growth
Loyalty liabilities ballooned as co-branded credit card partnerships accelerated point accrual, widening the gap between points earned and redeemed by $473 million last year. The accounting treatment of deferred revenue allows hotel groups to hold unredeemed point value as a balance sheet liability.
3. Securitization Prospects
Hotels are exploring pledging loyalty programs as collateral for debt, leveraging the float from unredeemed points. IHG generated $74 million in working capital and $37 million in upfront card agreement cash last year, and airlines have previously raised billions by securitizing loyalty assets.