Written by Julien Ricciarelli-Bonnal
12 August 2026
The Essentials
Points, apps, status levels, discounts and rewards: loyalty programmes have never been more sophisticated, yet they often blur the distinction between loyalty and reward. Encouraging a customer to return through an economic incentive can improve retention and increase customer value without creating any genuine attachment to the brand. As soon as a competitor offers something better, that purchased loyalty may disappear as quickly as it appeared. Loyalty programmes therefore remain powerful marketing tools, provided companies do not expect them to produce something they cannot create on their own: genuine preference. A loyal customer does not return only because there is something to gain. They also return because they prefer to stay.
There was a time when a loyalty card was simple enough to fit into a wallet: a few stamps, a tenth coffee for free or a discount after several purchases. Since then, the principle has become considerably more sophisticated. Cards have become apps, stamps have become points, the best customers receive status levels, rewards are increasingly personalised and some companies have built entire ecosystems around their programmes.
This sophistication follows perfectly rational commercial logic. Retaining a customer, increasing purchasing frequency and gaining a better understanding of their habits has considerable value, while a loyalty programme can also generate useful data for personalising offers. It would therefore make little sense to dismiss these programmes as outdated simply because they have existed for decades.
The problem lies more in the word used to describe them. Many companies talk about loyalty whenever a customer returns, even though repeat behaviour can have very different causes: genuine preference for the brand, habit, convenience, price, lack of alternatives or simply an economic incentive to continue accumulating benefits.
A customer who returns because they genuinely like a company and another who returns because they need another 300 points to unlock a discount may temporarily produce exactly the same result on a dashboard. They do not represent the same asset for the brand.
Bringing a Customer Back Does Not Necessarily Make Them Loyal
The confusion between loyalty and retention is particularly convenient because the latter is much easier to measure. A company can track purchasing frequency, average basket value, points redeemed or the time elapsed since the last order, while it is considerably more difficult to measure what would happen if the customer found an equivalent proposition somewhere else tomorrow.
A loyalty programme affects precisely this equation by adding a cost, however small, to switching. Leaving a company can mean losing points, abandoning a status or giving up a reward that is almost within reach. The brand does not necessarily create any additional preference, but it makes departure slightly less attractive.
This mechanism can be extremely effective. Airlines have taken it particularly far with miles and status levels, retailers personalise their promotions, restaurant chains multiply their apps and many ecommerce businesses now reward purchases, referrals or engagement. Every interaction can become an opportunity to accumulate value that the customer has an incentive to redeem by remaining within the ecosystem.
Yet this commercial effectiveness should not be confused with emotional attachment. When consumers compare two companies and systematically choose whichever one offers the best return in points, they are behaving rationally; they are not necessarily demonstrating loyalty to either of them.
Brands Have Turned Loyalty Into a Transaction
In their efforts to measure customer relationships, companies have gradually transformed a qualitative concept into an accounting mechanism. A purchase earns points, frequency unlocks status, spending triggers benefits and the entire system produces a score that allows customers to be ranked according to their value.
This approach has an enormous advantage: it makes action possible. A brand can reactivate an inactive customer, reward its biggest buyers, offer a personalised promotion or identify people who may be about to leave. It turns a relationship that is difficult to observe into data that marketing teams can actually use.
But it can also create a strange inversion. Instead of rewarding loyalty that already exists, some companies use rewards in an attempt to manufacture that loyalty, eventually creating a relationship in which consumers systematically expect something in return for coming back.
The consequence becomes visible when the reward disappears. If customers immediately reduce their spending when a promotion ends, a status becomes less generous or points lose value, the brand discovers that it had not built preference at all: it had been subsidising behaviour.
A customer who comes back is not necessarily a loyal customer. Sometimes, they simply have another 2,840 points left to spend.
Even the Best Loyalty Programme Cannot Compensate for a Poor Experience
Loyalty programmes become particularly dangerous when they are used to conceal weaknesses in the experience itself. A company can multiply its rewards, but no points system will sustainably transform poor service, a disappointing product or a frustrating customer relationship into something desirable.
Genuine loyalty is often built through much less spectacular elements: consistent quality, simplicity, trust, recognition, the ability to solve a problem and the feeling that a company respects its customers’ time. These factors are more difficult to display inside an app, yet they often determine whether the relationship survives when a competitor appears.
This is also why some brands retain customers without offering the most generous programme in their market. They have created a strong enough preference that consumers do not completely recalculate the economic equation before every purchase. Loyalty begins precisely when choice is no longer based solely on an immediate comparison of the available rewards.
To build a marketing strategy that turns customer experience into a genuine competitive advantage, companies therefore need to look beyond retention mechanisms. A programme can support a relationship, but it cannot replace the fundamental reasons why that relationship deserves to continue.
A Good Programme Should Strengthen Preference, Not Buy It
None of this means loyalty programmes should disappear. When properly designed, they can recognise a company’s best customers, personalise the relationship and add value to an experience that already works. The problem begins when the programme itself becomes the main reason for returning.
Part of the difference lies in the nature of the reward. A systematic discount teaches customers to think in terms of price, while a benefit genuinely connected to the relationship can reinforce a sense of belonging: priority access, additional services, exclusive experiences, recognition of status or attention adapted to the customer’s history. In one case, the brand buys another transaction; in the other, it enriches the relationship.
This distinction becomes even more important as consumers accumulate programmes everywhere. Every retailer has an app, every platform offers a subscription and every brand seems determined to create its own points system, until the benefit that was supposed to differentiate the company gradually becomes another standard feature customers simply expect.
As everyone starts rewarding, rewards inevitably become less distinctive. Companies should therefore return to a much more basic question: if we removed the points, discounts and status levels tomorrow, how many of our customers would genuinely continue to choose us?
Genuine Loyalty May Begin When the Reward Becomes Secondary
A loyalty programme remains a tool and, like many marketing tools, its value depends on what a company expects it to accomplish. Used to increase frequency, understand customers better or recognise people who already have a strong relationship with the brand, it can produce considerable results.
It becomes much more fragile when the company gives it responsibility for creating that relationship on its own. A discount can trigger a purchase, points can encourage another visit and a status can make departure less attractive, but none of these mechanisms guarantees that a consumer will continue choosing the brand when a competitor offers a better reward.
Genuine loyalty has one characteristic that dashboards struggle to measure: it survives a reasonably attractive alternative. This does not mean customers will accept any price or forgive every mistake, but that their preference for the brand is strong enough to prevent the relationship from being put back up for auction every time they make a purchase.
Loyalty programmes have probably never stopped working. What needs correcting is our definition of what they actually accomplish: they can retain, stimulate, reward and help companies understand their customers, but loyalty itself is built elsewhere, through all the reasons that make people want to stay even when they are no longer being indirectly paid to return.
We support companies that want to build a marketing strategy capable of creating lasting preference rather than simply generating a succession of transactions.
Written by Julien Ricciarelli-Bonnal
12 August 2026
