Stash Hotel Rewards was the perfect combination of Jeff Low’s two areas of expertise. “I know rewards programs,” says the CEO and founder of Stash, “and I’ve always loved independent hotels.” Stash was launched in May 2010 with 65 three- and four-star-rated independent hotels in the U.S. That number is now at 164 after recent and big-name additions like The Modern Honolulu (originally the Waikiki Edition), the Iron Horse in Milwaukee and the Viceroy Miami.

Jeff Low, the founder and CEO of Stash Hotel Rewards

More than 15 new member properties have been added in the last month alone and Low says Stash has become the largest loyalty program for independent hotels in the U.S. The concept is simple: Guests can join Stash for free and then earn five points for each dollar spent on room rates. Those points can be redeemed at the 164 member properties in the U.S. and now the Caribbean and soon Canada. Points never expire, and there are no blackout dates or restrictions.

Low uses a highly scientific definition to explain exactly who the frequent traveler is: “It’s when your three-year-old asks when is daddy visiting again,” he jokes. Those road warriors, he says, rationalize the frequent travel by earning points, rewards and eventually family vacations to places like Disney World.

“The problem is these great independent properties didn’t offer points,” Low says. “And George Clooney [the character — a frequent traveler — he played in Up in the Air] is a really important guy to hotels. Almost 50% of roomnights come from frequent travelers and independent hotels can’t attract that guy. They’re losing 50% of the market.”

A map of Stash Hotel Rewards member properties.

Denihan Hospitality Group, which has six of its Affinia hotels in the Stash program, has seen those guests increase their average stays from 2.8 times a year to 3.3.

Independent hotels — if they’re not joining collections or soft brands from franchise companies like Marriott International or Choice Hotels — typically rely on transient business and more expensive online travel agencies for reservations. Stash provides a lower-cost alternative to gain some of that business and a way for frequent travelers to earn points at non-branded properties.

“Stash did something we’ve all been talking about, trying to figure out for years,” says Lisa Koester, director of sales and marketing at California’s Napa River Inn, a Stash member hotel. “They connected independent hotels with a points program. It’s genius.”

Hotels pay an initial $5,000 fee to have the up-front website built for Stash and then pay approximately 1.5 cents for every Stash point earned each month. “Stash costs about 4% of joining Autograph or Ascend and we don’t tell them how to run their hotel, mandate [property improvement plans] or put any constraints on how they manage the hotel, and our contracts are for one year,” says Low, who before starting Stash developed and ran Expedia’s ThankYou rewards program.

The Modern Honolulu

Although the big — really huge — difference is instead of having 10s of millions of members like with Marriott and Choice’s rewards programs, Stash is closing in on 100,000 members. As a result, fewer guests are booking or being exposed to member properties because of Stash, but also far fewer guests are earning points and costing those properties, Low points out.

Member hotels set the redemption rate for whatever they want, allowing for yield management during busier or slower times. Hence there are no blackout dates, and frequent travelers can redeem a point for roughly 1.5 cents whenever they want (10,000 points would usually earn a room night ranging in price from $130 to $150).

Low says there aren’t any guaranteed areas of protection for member properties, but Stash does discuss potential additions with its current partners. In major cities, like San Francisco there are currently seven Stash properties, and more than 10 in New York City. In Dallas, Indianapolis and Kansas City, for example, there are none.

Low says international expansion will come, but not before reaching density here in the U.S.

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