Many loyalty cards have an option to donate points to charity. It is very tempting to give a few thousand points to charity and feel that you have made a useful contribution without actually spending any of your own money.
The problem is that most of the deals offered are very bad value.
Frequent flyer and frequent hotel guest schemes always give the best value when redemptions are made “in house”. When you start swapping hotel points for flights or car hire, or vice versa, you almost always lose value. A “free flight”, not only costs the airline nothing (because, in theory, it is a seat that would remain unsold) but they are actually gaining income from the “taxes and charges” they make you pay. If an airline has to cough up actual cash to a charity, instead of giving the member a flight, it is going to lose money.
We have often said that the best way of giving to charity in these circumstances is to use your points for an actual reward and then give the cash value to a charity of your choice. The charity is going to gain much more cash and you will not have lost anything.
However, we have to say we were pleasantly surprised by The Priority Club, the loyalty scheme for Holiday Inn, Intercontinental etc. They have just announced a special donation scheme for the Haiti earthquake – and the sums actually make sense!
Donate 10,000 points and they will give $40.
The only way to judge this is by looking at what you could get with 10,000 points.
A night in a Holiday Inn Express or other Holiday Inns goes from 10,000 to 20,000.
A full breakfast at a Holiday Inn or Crowne Plaza (value, maybe £12) costs 4,000 points and a three-course dinner with a glass of wine (say £20) costs 8,500 points.
A voucher for £25 to use at Argos costs 15,000 points.
Looking at this list, if you could find a Holiday Inn available that you wanted to stay at, you might still be better off using the points for the free night. Using the points for breakfast or dinner could also make good sense. Have a free dinner for 8,500 and send a cheque to a charity for £20 and everyone wins.
Nonetheless, the “value gap” is much less than we normally see with such charity rewards so, for once, we can actually recommend donating Priority Club points to charity.
This is clearly costing the Intercontinental group money so they should be congratulated.
www.priorityclub.com