Fact-checked by Grok 2 weeks ago

Loyalty program

A loyalty program is a marketing initiative sponsored by retailers, airlines, and other businesses to encourage repeat customer engagement by offering redeemable rewards such as points, discounts, tiered perks, or exclusive access in exchange for ongoing patronage or data sharing.^[1] These programs operate on principles of behavioral reinforcement, where accumulated value from transactions unlocks benefits that aim to bind customers to a brand over competitors, often integrating digital tracking for personalized incentives.^[2] Common variants include points-based systems, where spending translates to redeemable credits; tiered structures that escalate rewards with loyalty levels; and coalition models partnering multiple firms for cross-redemption.^[3] The origins of loyalty programs trace to the late 18th century, when American retailers issued copper tokens redeemable only at their establishments to promote return visits, evolving through 19th-century trading stamps like those from the Sperry and Hutchinson Company in 1896, which customers pasted into books for household premiums.^[4] Post-1930s innovations, such as airline frequent flyer miles introduced by American Airlines in 1981, digitized and scaled these mechanisms, leading to today's app-based ecosystems that leverage big data for targeted offers.^[5] By the 21st century, adoption surged with e-commerce, though proliferation has commoditized many schemes, diminishing differentiation.^[6] Empirical analyses reveal loyalty programs can modestly boost retention and spending— for instance, participants often exhibit 5-10% higher purchase frequency in controlled retail settings—yet results vary by industry and design, with critics noting they frequently subsidize high-volume buyers who would remain loyal absent incentives, yielding limited net gains for firms after reward costs.^[7]^[8] Defining characteristics include reliance on customer data analytics for efficacy, raising privacy concerns in an era of surveillance capitalism, alongside challenges like reward dilution from oversaturation and the need for experiential or personalized elements to sustain engagement beyond transactional exchanges.^[9]^[10]

History

Origins in early commerce

In the late 18th and early 19th centuries, American retailers issued copper tokens to customers alongside purchases, which could be redeemed exclusively for merchandise or services at the issuing store on future visits.^[5] This practice, documented as early as 1793 in Sudbury, New Hampshire, where a local merchant distributed such tokens to encourage ongoing trade, represented an rudimentary closed-loop incentive system that bound value to the point of origin.^[11] Tokens, often made of low-denomination copper to mimic coinage, facilitated small-scale retention by leveraging scarcity and exclusivity in pre-industrial commerce, where customers lacked widespread alternatives and merchants competed through personalized loyalty rather than advertising.^[12] These tokens emerged amid economic constraints, including coin shortages during the post-Revolutionary period, serving dual purposes as makeshift currency and patronage motivators redeemable only locally to prevent leakage to competitors.^[13] By the 1830s and 1840s, their use proliferated among grocers, bakers, and general stores, with issuers stamping denominations like "good for 5 cents" or "one loaf of bread" to enforce redemption specificity and track informal accumulation.^[12] This mechanism empirically supported repeat transactions in community-based economies, as evidenced by surviving artifacts from over 600 issuers between 1800 and 1861, demonstrating a causal tie between token circulation and sustained merchant-customer ties without formal ledgers or widespread credit risks.^[13] The late 19th century saw an evolution toward trading stamps, which replaced physical tokens with collectible paper equivalents distributed by retailers in proportion to purchase amounts—typically one stamp per 10 cents spent.^[14] Pioneered around 1891 by Schuster's Department Store in Milwaukee, this system allowed stamps to be pasted into books and redeemed for household premiums via centralized catalogs, scaling incentives beyond single-store limits while maintaining retailer affiliation.^[15] The Sperry & Hutchinson Company's S&H Green Stamps, introduced in 1896, formalized this approach as the first major independent stamp promoter, partnering with thousands of grocers and enabling customers to accumulate thousands of stamps annually for items like china or linens, thereby amplifying retention through deferred, tangible rewards in an era of rising consumer goods variety.^[16]^[17]

20th-century expansion

Trading stamp programs expanded significantly in the early 20th century as retailers sought to incentivize cash purchases and repeat business amid growing competition. Introduced in the 1890s, these programs gained traction with grocery chains, where customers received stamps proportional to purchase amounts for redemption of household goods. By the 1920s, brands like Betty Crocker launched points systems, allowing consumers to collect coupons from product boxes for catalog merchandise, fostering brand loyalty among homemakers.^[11]^[18] The Sperry & Hutchinson Company's S&H Green Stamps epitomized this trend, reaching peak popularity in the 1960s when the firm distributed three times more stamps annually than the U.S. Postal Service issued, supported by the era's largest consumer catalog. Post-World War II economic expansion, characterized by rising disposable incomes and suburbanization, accelerated adoption as retailers competed for consumer spending in a burgeoning mass market. These programs demonstrably boosted repeat visits—studies of trading stamps showed up to 20% higher retention rates for participating stores—though proliferation led to early redemption challenges as stamps flooded the market, diluting individual value.^[16]^[19] Airline loyalty programs marked a late-20th-century innovation, enabled by the Airline Deregulation Act of 1978, which dismantled fare and route controls, intensifying competition and prompting carriers to fill excess capacity. American Airlines launched the AAdvantage program on May 1, 1981, as an invitation-only system awarding credits for flights redeemable for tickets, initially targeting high-value customers to monetize off-peak seats without direct price cuts. This model capitalized on business travel growth, with early data indicating 10-15% uplift in flyer retention, though it foreshadowed dilution from over-accrual as competitors replicated the approach.^[20]^[21]^[22]

Digital transformation and modern innovations

The digital transformation of loyalty programs accelerated in the 1990s with the integration of credit card-linked rewards, allowing issuers to tie points accumulation directly to transaction data for automated tracking and redemption.^[23] By the early 2000s, this evolved into card-linked offers (CLOs), where e-commerce platforms enabled targeted promotions based on purchase history, shifting from manual stamp-based systems to data-driven personalization.^[24] Early web portals further facilitated online enrollment and balance checks, laying the groundwork for scalable digital ecosystems. Post-2000 advancements in mobile technology introduced real-time engagement via smartphone apps, exemplified by Starbucks Rewards, which launched in 2009 and integrated mobile ordering with points tracking to enable seamless accumulation and redemption.^[25] These apps leveraged GPS and push notifications for location-based offers, increasing transaction frequency by providing instant visibility into rewards status and reducing friction in participation.^[26] By 2024-2025, artificial intelligence (AI) and advanced data analytics drove hyper-personalization, with programs using machine learning to predict preferences and tailor rewards in real time, as emphasized in the EY Loyalty Market Study 2025.^[27] A BCG report from 2024 highlighted elevated consumer expectations, noting 5-10% higher switching rates to competing programs due to demands for customized experiences, though well-executed digital systems maintained engagement through predictive analytics and dynamic tier adjustments.^[9] This era also saw integrations with broader ecosystems, such as AI-powered gamification and cross-app partnerships, enhancing retention by fostering experiential value over transactional points.^[28]

Types of Loyalty Programs

Closed-loop programs

Closed-loop loyalty programs, also termed proprietary or single-sponsor programs, confine the earning and redemption of rewards exclusively to the issuing brand's ecosystem, preventing use across external partners.^[29] This isolation ensures that accumulated value, such as points or perks, holds utility only within the sponsor's offerings, creating inherent switching costs for participants.^[30] Unlike coalition models, closed-loop structures eliminate reward dilution, as incentives drive repeat behavior solely toward the brand, minimizing leakage where value dissipates through multi-partner redemptions.^[30] The design promotes tighter brand lock-in by leveraging proprietary customer data for tailored experiences, which causal analysis attributes to higher retention over fragmented alternatives. Companies retain full ownership of behavioral insights, enabling precise targeting without data-sharing compromises inherent in coalitions. Empirical outcomes support this: participants in such programs exhibit lower churn due to the non-transferable nature of rewards, fostering habitual patronage as the marginal cost of defection rises with accrued benefits.^[29] Prominent examples include Walmart+, introduced in September 2020, which by 2025 boasts over 40 million members spending 35% more annually than non-subscribers, reflecting sustained engagement confined to Walmart's retail and delivery services.^[31] ^[32] Similarly, Sephora's Beauty Insider, with more than 45 million enrollees, drives 80% of North American sales and achieves an 80% retention rate—exceeding retail benchmarks—through tiered perks redeemable only at Sephora outlets and online.^[33] ^[34] These cases demonstrate how closed-loop exclusivity correlates with verifiable loyalty metrics, unmediated by cross-brand influences.^[35]

Open-loop coalition programs

Open-loop coalition programs involve multiple non-competing brands collaborating to form a shared loyalty ecosystem, where customers accumulate points through purchases at any participating partner and redeem them across the network for rewards from various entities. This structure leverages a centralized points pool, enabling interoperability that expands redemption options beyond single-brand limitations, thereby amplifying network effects as more partners increase the program's overall utility and attractiveness to consumers.^[36]^[37] Pioneering examples include Air Miles, launched in the United Kingdom in 1988 as the first multi-partner travel rewards program and expanded to Canada in 1992, which aggregates miles from diverse sponsors like retailers and service providers for redemption on flights, merchandise, or experiences. Similarly, the Nectar program in the UK, introduced in 2002, operates as a digital-first coalition with core partners such as Sainsbury's, Esso, and eBay, allowing members to earn and spend points interchangeably to foster habitual engagement across everyday spending categories. These models demonstrate how shared infrastructure facilitates scalability, with Nectar's coalition encompassing over 16 major brands and serving millions of active users through unified data and reward coordination.^[38]^[39]^[40] Empirically, such programs drive higher enrollment rates compared to proprietary systems by offering diversified earning opportunities, as evidenced in European implementations where coalition breadth correlates with broader consumer adoption; for instance, Nectar's model has sustained participation over two decades amid economic shifts, attributing growth to cross-brand point accumulation that enhances perceived program value. However, redemption rates exhibit variability, often lower than in closed systems due to point dilution across partners, with studies indicating that while cross-reward effects boost initial uptake, devaluations or mismatched incentives can erode sustained usage and impose financial strains on high-traffic merchants.^[41]^[42]^[43] The inherent trade-offs balance consumer flexibility—gaining expansive choice without siloed points—with elevated operational demands on partners, including shared administrative costs for point issuance, tracking, and settlement, which can strain smaller entities unless offset by volume-driven efficiencies. Partners typically compensate the coalition operator for issued points upon redemption, creating incentives for aligned reward relevance but risking inter-brand cannibalization if redemption skews toward dominant players. This causal dynamic underscores the programs' reliance on robust governance to mitigate dilution risks while capitalizing on aggregated data for targeted personalization.^[44]^[45]^[37]

Core Features

Enrollment and customer identification

Enrollment in loyalty programs begins with customer registration, where individuals provide identifying information to create a unique account linked to their transactions. Traditional methods include issuing physical plastic or paper cards upon signup at points of sale, which customers then present or scan during purchases for verification.^[46] Key fobs or keychain tags serve similar purposes as portable alternatives, while low-tech options like entering a registered phone number or email at checkout enable identification without carrying items.^[47] The transition to digital enrollment has reduced barriers, with customers signing up via brand websites or mobile apps by submitting details such as name, email, and phone number. In 2024, 63% of recent loyalty program enrollments occurred through mobile apps or websites, reflecting preferences for seamless, frictionless processes over physical alternatives.^[48] App-based methods often use QR codes generated on smartphones for instant scanning at checkout, eliminating the need for physical media and enabling real-time verification.^[47] The COVID-19 pandemic, starting in 2020, spurred a surge in contactless enrollment and identification techniques, as consumers favored touch-free options amid health concerns. This shift accelerated adoption of digital wallets, app integrations, and text-to-join features, where customers opt in by texting contact details for automated account creation.^[49] However, these methods necessitate collecting personal data for linkage, creating trade-offs where participants exchange privacy for program access; for instance, retailers like Kroger have faced scrutiny for aggregating and selling shopper data derived from loyalty identifiers.^[50]^[51] Such practices underscore the tension between convenient identification and risks of data commodification, with privacy advocates warning of potential exploitation under cost-saving pretexts.^[52]

Points accumulation and redemption mechanics

Customers accumulate points in loyalty programs primarily through qualifying purchases, where earn rates are calculated as a fixed ratio, such as 1 point per dollar spent or 5% of purchase value in points, incentivizing repeat transactions.^[53] Additional accumulation occurs via referrals, awarding points for successful customer acquisitions, and targeted behaviors like product reviews or social media interactions to encourage advocacy beyond mere spending.^[2]^[54] These mechanisms align with incentive design by linking rewards to measurable actions that drive revenue or engagement, though earn rates must balance attractiveness against program costs to avoid over-issuance.^[55] Redemption mechanics impose minimum thresholds, often 100-500 points, to prevent trivial exchanges and concentrate value in meaningful rewards, while expiration policies—typically 12-24 months of inactivity—curtail long-term liabilities by forfeiting unredeemed points, known as breakage.^[56] Breakage rates, frequently exceeding 50% in retail programs, effectively reduce the net cost of issued points, as expired balances revert to the issuer without payout; for instance, policies expiring points annually on a fixed date for all members streamline administration and favor active participants.^[57]^[58] Economically, points represent deferred discounts rather than free value, with profitability emerging when the marginal cost of accumulation (e.g., 1-3% of sales) is offset by uplift in customer lifetime value; break-even occurs at low redemption rates, such as 20-50%, where unredeemed points subsidize acquired loyalty without eroding margins.^[59]^[60] This structure exploits causal asymmetries in consumer behavior, as partial redemptions amplify perceived gains while high breakage—often 80% or more—ensures the program's net positive return, contingent on redemption not exceeding issuance costs.^[57] Empirical evidence from business analyses indicates short-term sales uplifts of 10-20% attributable to points-based incentives, driven by increased purchase frequency among enrollees, though long-term efficacy diminishes without scaling to higher-value behaviors due to habituation effects.^[61]^[62] These gains, observed in controlled implementations, underscore the mechanics' reliance on controlled liability management to sustain viability over baseline discounting alternatives.^[59]

Tiered structures and membership costs

Tiered loyalty programs segment participants into hierarchical levels, typically denoted as basic, silver, gold, platinum, or elite, where advancement depends on cumulative spending, purchase frequency, or engagement metrics that surpass predefined thresholds.^[63] Higher tiers unlock progressively valuable perks, such as enhanced redemption rates, priority service, exclusive offers, or personalized benefits, incentivizing sustained or accelerated customer expenditure to qualify or retain status.^[64] This structure economically rationalizes resource allocation by concentrating rewards on high-value customers, whose lifetime value often justifies the marginal costs of elite incentives, while basic tiers serve as low-barrier entry points to build initial habits.^[59] Premium tiers frequently incorporate membership fees, ranging from annual subscriptions akin to the Amazon Prime model—where users pay upfront for bundled privileges—to one-time or recurring charges that filter for committed participants.^[65] These fees generate predictable revenue streams decoupled from transactional sales, offsetting program administration costs and signaling customer investment, which correlates with heightened engagement and spending uplift of approximately 10% post-enrollment in modeled scenarios.^[59] Psychologically, tiers leverage loss aversion, where the prospect of demotion from a higher status—entailing forfeited perks—exerts greater influence on behavior than equivalent gains, prompting customers to expend more to preserve elite positioning.^[66] Status signaling further amplifies this, as elevated tiers confer a sense of superiority and social distinction, empirically fostering increased loyalty and purchase volume among qualifiers through reinforced self-perception.^[63] Despite these mechanisms, tiered systems exhibit exclusionary dynamics, disproportionately benefiting high-spenders while marginalizing lower-volume participants, who comprise the majority in skewed distribution data from hierarchical programs.^[67] This fosters inequality in reward access, as lower tiers offer minimal differentiation, potentially eroding broad participation and inviting backlash from non-qualifiers perceiving the structure as elitist or unattainable.^[68] Empirical retention models indicate that while top-tier members drive outsized value, overall program efficacy hinges on balancing inclusivity to avoid alienating the base, with some analyses revealing negligible per-visit spending lifts in non-tiered alternatives.^[69]

Reward Structures

Monetary incentives

Monetary incentives in loyalty programs deliver direct financial value to participants through mechanisms such as cashback rebates, discount coupons, and point-to-cash conversions, functioning as deferred price reductions that incentivize repeat transactions without immediate margin erosion. These rewards typically equate to 1-5% returns on purchases in retail contexts, where cashback is calculated as a percentage of spending and redeemed post-purchase or applied to future bills.^[70]^[71] Such structures exploit customers' sensitivity to immediate economic gains, mirroring the appeal of everyday bargaining while embedding loyalty via accumulation thresholds. Empirical analyses affirm the efficacy of these incentives in driving behavioral loyalty, with a 2021 meta-analysis of over 100 studies across industries finding that monetary reward programs yield statistically significant increases in purchase frequency (effect size d ≈ 0.20-0.30) and customer retention rates, outperforming non-reward baselines by simulating discounts that encourage habitual patronage without full upfront pricing concessions.^[72] This causal link stems from reinforced purchasing habits, as evidenced by field experiments showing 10-20% uplift in repeat spend among cashback enrollees compared to non-participants.^[73] However, effectiveness varies by segment, with price-sensitive consumers responding more robustly than others.^[74] Despite these benefits, monetary incentives exhibit inherent limitations in fostering deep lock-in, as their fungible nature enables easy cross-program comparisons, prompting switching to competitors offering superior rates or terms—evident in surveys where 30-40% of participants actively evaluate alternatives annually.^[9] This commoditization undermines long-term exclusivity, with redemption patterns revealing that cash-equivalent rewards often fail to deter defection when baseline economics (e.g., competitor pricing) shift, contrasting with less comparable non-monetary perks.^[75] Consequently, programs relying solely on such incentives may achieve short-term volume gains but struggle against rational arbitrage by informed consumers.

Non-monetary and experiential rewards

Non-monetary rewards in loyalty programs encompass intangible benefits such as exclusive access, personalized services, and unique experiences that cultivate emotional connections rather than direct financial returns. These perks, including priority upgrades, VIP event invitations, and customized recommendations, differentiate programs by leveraging scarcity and prestige to enhance perceived value. For instance, elite tiers in airline frequent flyer programs grant complimentary lounge access, offering amenities like comfortable seating, complimentary meals, and workspaces, which travelers report as key motivators for continued patronage.^[76]^[77] Experiential rewards drive superior retention compared to commoditized incentives by fostering long-term brand affinity through memorable interactions. A 2024 BCG analysis of consumer expectations revealed that participants seek programs delivering differentiated experiences, such as personalized content and partnerships, beyond mere monetary value, with U.S. consumers averaging membership in 14 programs yet prioritizing those with experiential elements for sustained engagement. Similarly, experiential offerings like brand-hosted events or early product previews outperform transactional rewards, as evidenced by reports indicating they generate enduring loyalty by aligning with customers' lifestyles and creating scarcity-driven attachment.^[9]^[78]^[79] In 2025 trends, demand for such rewards has intensified, with surveys showing consumers favoring innovative, diverse features like timely personalized alerts and experiential opportunities over discounts alone. The EY Loyalty Market Study of 2025 highlighted that most respondents desire programs incorporating non-monetary perks to boost satisfaction, correlating with reduced churn rates—up to 79% of members attributing retention to experiential program aspects. Airline examples underscore this, where lounge privileges not only elevate travel satisfaction but directly influence repeat business, as lounges contribute to brand reputation and member stickiness amid competitive devaluations of point-based systems.^[80]^[81]^[76]

Implementation and Access Channels

Digital platforms

Digital platforms, including mobile applications and websites, enable scalable implementation of loyalty programs by facilitating real-time points accumulation, redemption, and customer interaction through integrated data systems. Mobile apps allow users to earn and redeem rewards instantly at points of sale via QR codes or NFC, with 60% of loyalty program members preferring app-based access for its convenience over other methods.^[82] This tech-enabled approach leverages device capabilities for seamless transactions, contrasting with slower traditional channels, and supports data collection on user behavior to refine program mechanics. Push notifications within apps drive engagement by delivering timely alerts on points balances, personalized offers, or redemption opportunities, resulting in up to fourfold improvements in user retention rates compared to apps without them.^[83] Websites complement apps by providing comprehensive account management, such as historical transaction reviews and tier status updates, accessible via browsers for users without mobile devices or preferring desktop interfaces. These platforms enhance scalability, as cloud-based infrastructures handle millions of users without proportional cost increases, while aggregating transaction data for analytics that inform program adjustments. Recent innovations include AI-driven personalization, with over 80% of brands planning to deploy tailored rewards via algorithms analyzing purchase history and preferences by 2025.^[84] Integrations with digital wallets (e.g., Apple Pay) and e-commerce ecosystems enable frictionless redemptions, such as applying points at checkout, boosting participation; for instance, app users exhibit 23% higher retention after three months than non-app users.^[85] Empirical data from 2025 reports indicate that 72% of mobile loyalty app users report increased repeat purchase likelihood due to these features.^[86]

Traditional and hybrid methods

Traditional loyalty programs primarily utilize physical mechanisms such as punch cards or stamp cards, where customers receive a tangible card that staff mark with a punch or stamp for each qualifying purchase. Upon accumulating a fixed number of marks—typically ten for "buy ten, get one free" schemes—customers redeem a reward, like a complimentary item.^[87] These methods rely on manual verification at the point of sale, often via in-store scans of barcoded cards or simple phone-based inputs of membership numbers.^[88] Hybrid approaches blend these physical elements with limited digital integration to enhance inclusivity, such as embedding QR codes or barcodes on cards that customers or staff scan using mobile apps for verification, while preserving the card for non-smartphone users.^[89] This setup allows seamless transitions between manual punches and app-linked tracking, accommodating environments with variable technology access.^[90] Such methods offer accessibility advantages, particularly for demographics like the elderly or residents in regions with low smartphone penetration, where physical cards provide verifiable, low-barrier participation without requiring internet or devices.^[91] The tangible nature of stamps or punches also delivers immediate visual feedback on progress, fostering a sense of achievement through direct handling.^[89] Nevertheless, traditional systems face elevated fraud risks, including card duplication, unauthorized marking, or sharing among non-customers, which undermine reward integrity due to the absence of centralized digital safeguards.^[92] Manual processes further slow data capture and increase errors in tracking purchases, limiting analytical insights compared to automated alternatives.^[88]

Industry-Specific Applications

Retail and consumer goods

Loyalty programs in retail and consumer goods sectors emphasize frequent, low-value transactions typical of everyday shopping, such as groceries and household essentials, to build scale through repeat visits. These programs often integrate digital apps for personalized discounts on staples like milk, bread, and cleaning supplies, capitalizing on high purchase volumes to drive incremental sales. Empirical analyses indicate that such initiatives can increase average basket size by encouraging add-on purchases, as retailers use data from program enrollment to suggest complementary items at checkout.^[93] Target Circle exemplifies this approach, offering members 1% rewards on purchases alongside tailored deals based on shopping history, which contributed to a 9% uplift in digital sales after program enhancements introduced tiered benefits in early 2025. Grocery chains similarly deploy apps like those from Kroger or Safeway, where redemption occurs predominantly on essential goods, fostering habitual buying patterns as consumers accumulate micro-rewards—small discounts or points—on routine staples, thereby reinforcing store preference without requiring large expenditures. Studies across multiple retailers confirm that these micro-incentives yield higher redemption rates for high-frequency categories compared to luxury items, as the immediate utility aligns with consumers' causal incentives for cost savings on necessities.^[94]^[95] Meta-analyses of loyalty program outcomes reveal consistent positive effects on retention and spend in volume-driven retail environments, with top-performing schemes boosting revenue from active redeemers by 15-25% annually through sustained engagement on everyday purchases. However, effectiveness hinges on avoiding dilution from overly broad targeting; programs that prioritize data-driven personalization over generic offers demonstrate superior basket uplift, as evidenced by large-scale grocery studies spanning hundreds of brands.^[72]^[96]^[97]

Travel, airlines, and hospitality

Loyalty programs in the airline industry originated with American Airlines' AAdvantage, launched on May 1, 1981, as the first widespread frequent flyer scheme, allowing members to earn miles based on flight distance and fare class for redemption toward free tickets, seat upgrades, or partner services.^[20] Subsequent programs, such as United Airlines' MileagePlus introduced shortly after, expanded to include elite tiers offering perks like priority boarding and lounge access, fostering repeat business in a deregulated market post-1978 Airline Deregulation Act.^[98] These schemes emphasize experiential rewards tied to transient travel, where miles accrue not only from flights but also from co-branded credit card spending and partner purchases, with redemption often requiring advance booking amid capacity constraints. Airlines manage program economics through revenue diversification, primarily by selling miles to financial institutions for credit card issuance, generating billions annually; for instance, American Airlines derived $5.2 billion from such partnerships in 2023, often exceeding core ticket sales profitability.^[99] This model enables overbooking of reward inventory, as historical redemption rates hover below 20-30% due to expiration policies and behavioral inertia, allowing carriers to recognize deferred revenue while maintaining high load factors on paid seats.^[100] Causally, this structure incentivizes customer lock-in via network effects in alliances like Star Alliance or Oneworld, where miles transfer across partners, but it relies on predictable non-redemption to avoid fulfillment costs exceeding liability reserves. Empirical analyses indicate these programs yield a loyalty premium, with members contributing disproportionately to revenue through higher yields per passenger; one assessment links frequent flyer participation to elevated fares at hub airports via reduced price sensitivity.^[101] However, effectiveness varies, as programs enhance retention among moderate flyers but show diminishing returns for heavy users who optimize redemptions, per qualitative reviews of European carriers like Air Berlin.^[102] Overall, loyalty initiatives bolster margins amid volatile fuel costs, with Skift Research estimating them as resilient assets yielding superior cash flows compared to commoditized operations.^[103] In hospitality, hotel chains mirror airline models with points-based systems, such as Marriott Bonvoy (launched 2018 via merger) or Hilton Honors, where guests earn 5-10 points per dollar spent on stays, redeemable for free nights, upgrades, or suite access at over 7,000 properties.^[104] These programs integrate experiential elements like late checkout or spa credits for elite tiers, accruing points from direct bookings to encourage bypass of online travel agencies, though revenue often stems from partnerships rather than stays alone.^[105] Devaluation poses inherent risks, as airlines and hotels periodically increase miles/points required for rewards or restrict availability, eroding perceived value and trust; U.S. Department of Transportation probes since 2023 highlight how such changes, like Delta's 2023 dynamic pricing shifts, disadvantage non-elite members amid rising program liabilities.^[106] This practice, while stabilizing short-term economics, can prompt customer churn if redemption barriers exceed loyalty incentives, underscoring the tension between revenue extraction and sustained engagement.^[107]

Gaming, casinos, and entertainment

In casino loyalty programs, complimentary offerings, or "comps," are determined by a player's theoretical loss (theo), calculated as the product of wager volume, game duration, and the house edge, rather than actual outcomes. This approach allows operators to extend incentives like free slot play, hotel accommodations, meals, and access to shows proportionally to anticipated revenue, typically rebating 25-40% of theo in value to encourage prolonged engagement despite inherent variance in gambling results.^[108]^[109] Tiered membership structures, such as those in MGM Rewards or Caesars Rewards, escalate benefits based on theo thresholds—for example, qualifying for elite status might require $10,000-50,000 in annual theo, unlocking priority reservations and personalized host services that foster retention by reducing perceived risk through guaranteed perks. Empirical analysis from a Las Vegas casino evaluation showed loyalty program enhancements yielded a long-term increase in player value, with conflicting but generally positive findings on sustained play amid competitive pressures.^[110]^[111] A 2015 field experiment at a Midwest casino demonstrated that refined loyalty interventions boosted daily slot coin-in by $302,455 without significantly altering table game metrics, attributing gains to targeted retention of high-value players via variance-mitigating rewards. Similarly, the American Gaming Association's 2023 data linked robust programs to a 30% uplift in repeat visits, as comps counteract short-term wins that might otherwise deter future play.^[112]^[113] In video gaming, loyalty systems mirror casino dynamics by dispensing rewards like exclusive skins, battle passes, or currency to offset variance from probabilistic mechanics such as loot boxes or gacha pulls, which impose effective house edges of 5-20% on microtransactions. Platforms like Xbox Live Rewards or PlayStation Stars accrue points from playtime and purchases, redeemable for in-game boosts that sustain daily active users; industry reports indicate such programs elevate retention by 20-50% in free-to-play titles by framing random outcomes as navigable through accumulated status.^[114]^[115] Casino-integrated entertainment loyalty extends comps to theater productions or concerts, where VIP tiers grant exclusive seating or pre-show access tied to gaming theo, empirically linking these perks to extended on-property dwell time and reduced churn despite overall house advantages. For instance, programs at resorts like those operated by Wynn or MGM bundle show tickets with free play, data from gambling research syntheses showing heightened perceived value that promotes cross-activity loyalty in high-variance environments.^[116]^[117]

Food and beverage sectors

In quick-service restaurants and cafes within the food and beverage sector, loyalty programs leverage frequent, low-value transactions to build habits and gather behavioral data for personalized targeting, with 71% of such establishments offering programs as of 2025.^[118] These adaptations emphasize mobile apps for seamless accumulation of points on habitual purchases, such as daily coffee, enabling operators to analyze purchase patterns and predict churn through transaction frequency metrics.^[119] Starbucks Rewards exemplifies this approach, where members earn two Stars per dollar spent via the app—translating to a free beverage after 150 Stars—and tiered benefits like Gold status for higher spenders, driving repeat visits among 30 million active U.S. users as of 2024 data extended into 2025 operations.^[120] The program's 2025 pilot "Coffee Loop" further tests punch-style mechanics, offering a free coffee after nine purchases to mimic traditional formats digitally while limiting participation to combat overuse. Such high-frequency models yield robust datasets for inventory optimization and promotions, though empirical retention hovers at 55% industry-wide, reflecting saturation where consumers juggle multiple apps leading to diluted engagement.^[121] Punch-card systems persist as low-tech alternatives in independent QSRs, awarding stamps per qualifying purchase (e.g., one drink) redeemable after 10-12 visits, fostering incremental loyalty without digital barriers but risking loss or fraud.^[122] Digital hybrids, like app-based virtual punches, enhance trackability while retaining simplicity for smaller outlets.^[123] Countering rigid loyalty, "disloyalty" punch cards have appeared in networks of independent coffee shops, such as a 2023 scheme across five northeast UK cafes where stamps from distinct venues culminate in a free drink, satirically incentivizing exploration over exclusivity to highlight consumer choice amid program proliferation.^[124] Similar initiatives in Edinburgh and U.S. cities like Washington, D.C., from 2014 onward, underscore pushback against saturation, with participants reporting broadened tastes but no formal metrics on sustained disloyalty impacts.^[125] By 2025, such counters reveal causal tensions: while loyalty apps excel in data-driven retention for chains, oversaturation prompts 20% higher visit frequency among members yet elevates churn when rewards feel commoditized.^[126]

Economic Impacts and Empirical Effectiveness

Benefits to businesses

Loyalty programs contribute to business profitability by capturing revenue from breakage, the unredeemed fraction of points or rewards issued to customers, which often ranges from 20% to 30% across various programs.^[127] This unredeemed value accrues as pure profit since companies avoid associated redemption costs, such as product fulfillment or discounts, while having already benefited from the initial customer spending that earned the points.^[128] In high-volume sectors like retail, breakage can represent a significant margin enhancer, as infrequent redeemers forfeit value that bolsters overall program economics without additional outlay.^[57] Empirical evidence from meta-analyses demonstrates that loyalty programs drive measurable sales and profit growth, with firms implementing such programs experiencing an average 7% increase in total sales and 6% in gross profits.^[72] These findings derive from synthesizing data across diverse industries and program designs over four decades, isolating program effects beyond self-selection biases where inherently loyal customers might join regardless.^[129] A 5% improvement in customer retention via these programs correlates with profit uplifts of 25% to 95%, as retained customers yield higher lifetime value through repeat transactions at lower acquisition costs.^[130] Beyond direct revenue, loyalty programs furnish granular customer analytics that enable precise segmentation and personalization, optimizing marketing efficiency and inventory management.^[10] Transactional data from program participation reveals purchasing patterns, preferences, and demographics, allowing businesses to target high-value segments with tailored offers that increase conversion rates and reduce wasteful broad-spectrum advertising.^[131] This data-driven approach enhances causal links between program incentives and incremental spending, as segmented cohorts respond more predictably to rewards aligned with their behaviors.^[8]

Consumer advantages and behaviors

Consumers derive tangible financial advantages from loyalty programs, including direct savings through discounts, cashback, and redeemable points that lower the net cost of goods and services. These mechanisms enable rational accumulation of value over time, with participants often reporting reduced expenditures; for example, 85% of consumers identify points, cashback, and promotions as key benefits influencing their program engagement.^[9] Convenience arises from streamlined tracking via apps or cards, facilitating personalized offers without additional effort beyond routine purchases. Exclusive perks, such as early access or member-only deals, further incentivize participation, with 79% of customers stating that unlocking such benefits drives their loyalty to brands.^[132] Behavioral patterns reflect calculated responses to program structures, where consumers strategically stockpile points to ascend tiers offering superior rewards, even in non-tiered linear systems designed without explicit stockpiling incentives. Research indicates this hoarding persists as participants delay redemptions to maximize future value, prioritizing larger, aggregated payoffs over immediate small gains.^[133] Tier progression encourages concentrated spending to unlock escalating benefits, fostering habitual patronage aligned with perceived long-term utility. Yet, these behaviors entail trade-offs, as the effort to monitor balances and optimize redemptions yields marginal returns for many; global redemption rates for loyalty rewards average 49.8%, with points often expiring unused, underscoring the rational calculus of time invested against realizable savings.^[134] ^[132] Participants weigh these opportunity costs, selectively engaging in programs where exclusive drivers outweigh administrative burdens, as evidenced by sustained participation rates despite suboptimal utilization.^[135]

Evidence from studies on program outcomes

A comprehensive meta-analysis published in 2021, synthesizing 429 effect sizes from studies spanning 1990 to 2020, found strong evidence that loyalty programs (LPs) enhance customer loyalty overall, with a particularly robust impact on behavioral loyalty—such as repeat purchases and share of wallet—evidenced by an average effect size indicating significant increases in these metrics.^[136] However, the analysis revealed more modest effects on attitudinal loyalty, such as emotional attachment or preference, suggesting LPs primarily drive observable actions rather than deep-seated preferences.^[136] This distinction aligns with causal mechanisms where programs reinforce habitual behaviors among predisposed customers but struggle to convert indifferent ones without complementary factors like product quality.^[136] Subsequent reviews, including the 2024 EY Loyalty Market Study surveying over 5,000 consumers across multiple markets, affirm that personalization in LPs—tailoring rewards to individual purchase histories and preferences—significantly boosts sales and engagement, with personalized programs linked to higher repeat business rates and customer retention compared to generic ones.^[48] Similarly, analyses from eMarketer in 2024 highlight that enhanced personalization addresses consumer demands, yielding measurable uplifts in program participation and revenue per user, though effectiveness varies by program maturity and data utilization quality.^[137] These findings underscore that LPs amplify engagement when leveraging granular data, but generic implementations yield weaker outcomes, as they fail to account for heterogeneous customer motivations. Long-term evaluations present mixed results on sustained value, with empirical evidence indicating diminishing returns over time absent ongoing innovation or adaptation. A 2024 study on promotional incentives within LPs observed initial short-term spikes in purchase frequency but attenuated long-term effects, attributed to habituation and competitive saturation.^[138] Broader research, including longitudinal analyses, supports that without refreshers like tiered rewards or experiential elements, participation rates decline as customers perceive reduced marginal value, leading to net effectiveness erosion after 2-3 years in many cohorts.^[139] This pattern reflects underlying causal realities: LPs most effectively scale existing behavioral predispositions rather than generating loyalty ex nihilo, with sustained impacts requiring alignment to evolving preferences rather than static incentives.^[136]^[138]

Global and Regional Variations

Asia-Pacific adoption patterns

In the Asia-Pacific region, loyalty programs demonstrate accelerated adoption amid robust economic growth and technological integration, with the market projected to expand by 16.3% to US$35.83 billion in 2025.^[140] This growth reflects high-density implementations in urbanized markets like Japan, China, and India, where programs leverage digital ecosystems for widespread consumer engagement. Coalition models, while not ubiquitous, facilitate cross-partner point accumulation; Japan's T-Point, launched as one of the region's first large-scale coalitions, enables redemption across diverse retailers, contributing to Japan's overall loyalty market value of US$10.66 billion in 2023.^[141]^[142] Comparable programs include Japan's Ponta and Australia's Flybuys, which expand reach through strategic alliances amid competition from proprietary schemes.^[143] Mobile-first strategies dominate due to smartphone penetration rates often exceeding 75%, particularly in East Asia, where super-apps integrate loyalty features with payments and e-commerce.^[144] In markets like China and India, platforms such as Alipay and Paytm exemplify this trend, with digital payment-linked programs driving real-time rewards and reducing reliance on physical cards.^[145] Younger consumers, comprising a significant demographic, favor AI-enhanced, interactive experiences over static points, accelerating adoption in high-growth sectors like retail and fintech.^[146] Participation rates exceed global benchmarks, with over 75% of consumers enrolled in at least one program, supported by cultural emphases on collectivism that prioritize sustained brand relationships.^[144] In Asia-Pacific, nearly 33% of participants cite emotional connections to brands as a primary motivator for joining, surpassing worldwide averages and reflecting values that favor interdependence over individualism.^[147] Urban density in megacities further amplifies engagement, as frequent transactions in concentrated retail environments reinforce habitual program use, though empirical studies note variability by market maturity.^[148]

European regulatory contexts

The General Data Protection Regulation (GDPR), implemented on May 25, 2018, fundamentally shapes loyalty programs across the European Union by requiring operators to process personal data only on a lawful basis, such as explicit consent or legitimate interest, while adhering to principles of data minimization, purpose limitation, and accountability.^[149] Programs must obtain granular consent for tracking purchase histories, awarding points, or sending personalized offers, with mandatory transparency via clear privacy notices detailing data collection, usage, and retention periods; non-compliance risks fines up to 4% of global annual turnover or €20 million, whichever is higher.^[149]^[150] These rules constrain deep behavioral profiling and cross-device tracking, as loyalty schemes cannot retain or share data indefinitely without justification, often necessitating anonymization techniques or aggregated insights to avoid infringing on individuals' rights to access, rectification, or deletion of their information.^[151] Consequently, personalization evolves more cautiously, prioritizing opt-in mechanisms over pervasive surveillance, which some operators mitigate by redesigning apps and databases for pseudonymized data handling—evident in cases where global firms paused EU operations briefly to overhaul systems for compliance.^[151] This framework promotes market dynamics centered on trust rather than data exhaust, enabling programs to sustain engagement through verifiable consent trails that support targeted yet privacy-respecting rewards. In the United Kingdom, aligned with EU standards via the UK GDPR since Brexit, the Nectar program—serving over 18 million households—has integrated compliance by updating privacy policies to specify data sharing with partners like Sainsbury's and forming GDPR-aligned collaborations, such as anonymized audience segments for advertising with Channel 4 launched in recent years.^[152] Such adaptations balance regulatory demands with operational viability, fostering consumer confidence that can underpin program retention, as evidenced by Nectar's continued coalition model across 300+ brands despite heightened scrutiny on data flows.^[152] Overall, GDPR-influenced regimes yield programs resilient to privacy challenges, though they temper innovation in favor of ethical data stewardship.^[153]

North and South American developments

In the United States, loyalty programs have achieved significant dominance through airline frequent flier initiatives tightly integrated with co-branded credit cards, generating billions in revenue for major carriers as of 2025.^[154] Programs such as American Airlines' AAdvantage and Delta's SkyMiles exemplify this model, where consumers earn transferable points via everyday credit card spending, redeemable for flights, upgrades, or partner perks, with top programs ranked for value in points flexibility and policy leniency.^[155] This integration has expanded beyond travel, allowing airlines to monetize non-flight purchases while fostering sustained engagement through tiered elite status benefits like priority boarding and free baggage.^[156] Canada's loyalty landscape mirrors U.S. credit-linked models but emphasizes broader retail and everyday rewards, with the market projected to reach $1.78 billion by 2025 at a 14.6% compound annual growth rate.^[157] Canadians participate in an average of 14 programs, favoring tangible, accessible rewards in grocery and fuel sectors via platforms like PC Optimum and Aeroplan, which blend points accumulation with airline partnerships for hybrid redemption options.^[158] Developments include rising adoption of gamification and sustainability-linked incentives, though challenges persist in program saturation and redemption ease.^[159] In Latin America, loyalty programs contrast with North American formality through informal, mobile-first adaptations driven by e-commerce expansion, with the regional market forecasted to grow 17% to $5.09 billion in 2025.^[160] Retail apps in countries like Brazil and Mexico have surged alongside online sales exceeding $319 billion in 2024, offering points for purchases via platforms integrated with local payment systems and social commerce.^[161] This growth reflects adaptations to fragmented banking infrastructure, prioritizing app-based accumulation over credit card ecosystems, with a 9.8% CAGR through 2028 fueled by digital-native consumers.^[162] Across both regions, 2025 trends emphasize hyper-personalization in hybrid models combining transactional points with experiential rewards, as U.S. brands leverage AI for tailored offers amid consumer demands for relevance.^[163] Empirical data shows these evolutions boosting retention, though North American credit depth provides scalability absent in South America's app-centric informality.^[164]

Oceania and other regions

In Australia, the Flybuys program exemplifies a prominent coalition loyalty initiative, jointly owned by Coles Group and Wesfarmers, involving partnerships with retailers like Kmart and Target as well as fuel providers such as Shell.^[165] Launched in 1994, it rapidly attracted one million households within the first six weeks and has sustained dominance, with over 10 million cardholders across more than 5.5 million households as of 2022.^[166] Approximately 86% of Australian consumers participate in at least one loyalty program, reflecting high per-capita engagement facilitated by the market's retail concentration, where two major grocers dominate significant share.^[167]^[168] New Zealand exhibits similarly elevated adoption, with 97% of residents enrolled in at least one retail loyalty program according to a 2022 Visa study.^[169] Key schemes include Fly Buys, which operates across grocery and fuel sectors akin to its Australian counterpart, alongside AA Smartfuel and Countdown's Onecard, underscoring widespread reliance on points-based rewards in a concentrated retail landscape.^[170] In Africa and the Middle East, loyalty programs remain niche and emerging, often hampered by uneven infrastructure in less developed markets, including limited digital payment systems and internet penetration that constrain scalability.^[171]^[172] Growth is projected at 18.1% annually in Africa through 2029, driven by mobile fintech in select countries like Kenya and South Africa, yet broader rollout lags due to regulatory variances and infrastructural gaps.^[173] In the Middle East, programs like Shukran Rewards and Amber emphasize experiential perks amid a 13.8% CAGR forecast, but adoption is tempered in infrastructure-challenged areas, prioritizing discounts over complex data-driven personalization.^[174]^[175]

Loyalty Programs as Virtual Currencies

Functional parallels to currency systems

Loyalty program points operate as a form of quasi-currency, functioning as a redeemable store of value within a closed ecosystem controlled by the issuing entity, much like historical company scrip systems where workers received tokens exchangeable only for goods at employer-owned stores.^[176]^[177] This confinement to the program's network—typically redeemable solely for the sponsor's products, services, or partner offerings—mirrors scrip's role in enforcing economic dependency and loyalty in isolated company towns, where alternative uses were precluded, preserving internal stability but limiting broader fungibility.^[176] From an accounting perspective, issued points represent deferred revenue liabilities on the balance sheet, reflecting the obligation to deliver future value equivalent to a portion of the original purchase price, estimated at the fair value of expected redemptions.^[178]^[179] Breakage, or the portion of unredeemed points that expire unused, allows issuers to recognize this as immediate profit once estimable, with retail programs often achieving breakage rates exceeding 80%, effectively converting unclaimed liabilities into revenue without fulfillment costs.^[57]^[180] This mechanism parallels uncirculated scrip's value retention for the issuer, bolstering financials while incentivizing selective redemption patterns. In stable closed systems, points maintain consistent purchasing power for defined rewards, akin to fixed-exchange scrip upholding value within the town's commissary, fostering predictable consumer behavior without external volatility.^[181] However, devaluation—through reduced point values, higher redemption thresholds, or altered terms—erodes this stability, diminishing perceived worth and paralleling fiat currency inflation's assault on trust and savings.^[182] Empirical observations indicate such changes provoke customer backlash and loyalty attrition, as seen in airline frequent flyer program adjustments that heightened redemption barriers, leading to widespread perceptions of betrayal and program abandonment.^[182]^[183]

Blockchain and emerging integrations

Blockchain integrations in loyalty programs primarily involve tokenizing rewards as cryptocurrencies or non-fungible tokens (NFTs) to leverage distributed ledger technology for enhanced transparency and immutability. These tokens record transactions on tamper-proof ledgers, theoretically mitigating fraud such as point duplication or unauthorized redemptions, which affect up to 1-2% of loyalty transactions in traditional systems according to industry estimates.^[184] However, empirical data on fraud reduction remains anecdotal, with no large-scale studies confirming superior outcomes over centralized databases as of 2025.^[185] Notable pilots emerged in 2024-2025, focusing on niche applications. In December 2024, Japan's Loyalty Marketing initiated a blockchain pilot for its Ponta Points program on the Avalanche network, onboarding 30,000 customers to test tokenized point issuance and redemption, aiming for verifiable transaction histories.^[186] Similarly, Starbucks expanded its Odyssey program in 2023-2024, using blockchain to distribute NFTs as loyalty rewards for customer engagement, such as virtual experiences, though participation has been limited to select markets with under 100,000 active users reported.^[187] These initiatives highlight potential for fraud-resistant ledgers but involve high development costs—often exceeding $1 million for initial setups—and face scalability issues on public blockchains due to transaction fees and latency.^[188] Interoperability remains a touted benefit, enabling cross-program point exchanges via standardized tokens, as explored in conceptual frameworks for aviation and retail alliances. Yet, real-world evidence is confined to small consortia; for example, a 2024 token-based pilot by a European retail coalition allowed limited swaps but reported integration expenses 3-5 times higher than legacy APIs, deterring broader adoption.^[189] Overall, while blockchain offers causal advantages in auditability for high-value or multi-partner programs, its niche deployment reflects unresolved challenges like regulatory hurdles for tokenized assets and minimal proven ROI beyond hype-driven marketing.^[190]

Criticisms and Controversies

Privacy, data usage, and surveillance risks

Loyalty programs typically require participants to provide personal identifiers such as names, email addresses, phone numbers, and payment details, alongside transaction histories to enable personalized offers and rewards.^[191] This data aggregation facilitates consumer profiling, constructing detailed behavioral models of spending habits, preferences, and demographics that extend beyond immediate transactions.^[192] Such profiling, while enhancing targeting efficiency, heightens vulnerability to misuse if data is compromised, as profiles can reveal intimate lifestyle patterns including health, travel, and financial behaviors.^[193] Verifiable data breaches underscore these risks. In August 2023, Caesars Entertainment experienced a breach exposing sensitive personal information of a substantial portion of its loyalty program members, including names and contact details, following a ransomware attack linked to social engineering.^[194] Similarly, Marriott International's Bonvoy program suffered multiple incidents between 2018 and 2020, compromising passport numbers, payment card data, and travel histories for up to 500 million accounts globally.^[195] In September 2025, Estonia's Apotheka pharmacy loyalty program leak revealed names, identification codes, emails, and gender data for numerous users, resulting in a €3 million fine for inadequate safeguards.^[196] These events demonstrate how breached loyalty data can fuel identity theft, phishing tailored to exposed habits, or resale on dark web markets.^[197] Surveillance concerns arise from data retention and potential third-party sharing, where aggregated profiles may enable broader monitoring without explicit consent. For instance, programs like those of airlines and hotels have linked loyalty data to government watchlists post-breaches, amplifying risks of unwarranted scrutiny.^[198] In a July 2025 Qantas cyberattack, stolen customer records—including frequent flyer details—highlighted how such data could be exploited for persistent tracking across ecosystems.^[199] However, empirical privacy calculus models indicate that participants often disclose data when perceived rewards—such as discounts and convenience—outweigh disclosed risks, reflecting voluntary trade-offs in opt-in systems rather than inherent coercion.^[200] Economic assessments of targeted marketing further suggest that efficient data use reduces promotional waste, yielding net consumer value through lower prices funded by precision, provided breaches remain infrequent relative to participation scale.^[201]

Questions of true loyalty versus price sensitivity

Critics argue that loyalty programs often foster spurious rather than genuine loyalty, primarily by appealing to price-sensitive consumers who prioritize discounts over brand affinity. Empirical analysis from the credit card industry in the early 1990s revealed that reward programs, while increasing short-term usage among participants, predominantly attracted customers prone to switching providers for superior incentives, thereby elevating acquisition costs without enhancing long-term retention to the sponsor.^[202] This pattern extends to other sectors, where program enrollees demonstrate heightened elasticity, defecting to competitors offering marginally better redemption values or accrual rates, as documented in behavioral data from frequent flyer initiatives.^[7] Behavioral metrics, such as repeat purchase rates, frequently appear inflated due to self-selection bias, wherein heavy or habitual buyers join programs irrespective of incentives, attributing their patterns to the scheme rather than underlying preferences. A review of airline and retail implementations found no significant attitudinal shifts toward brand preference among members; instead, redemption patterns correlated strongly with deal availability, subsidizing transient, price-driven patronage over committed relationships.^[202] ^[203] Consequently, firms risk channeling rewards toward low-margin, opportunistic users who exploit promotions across multiple programs, eroding profitability without cultivating the emotional or habitual bonds indicative of true loyalty.^[7] Meta-analytic evidence reinforces this skepticism, showing that loyalty program effects on retention diminish when controlling for deal-proneness, with many initiatives failing to differentiate between passive repeaters and actively loyal customers. In competitive markets like groceries, participants' share-of-wallet remains volatile, responsive to rival discounts, underscoring that programs often serve as de facto price-buffering tools rather than loyalty builders.^[129] This dynamic prompts reevaluation of program efficacy, prioritizing designs that target attitudinally committed segments over broad enrollment drives.^[204]

Economic distortions and anti-competitive effects

Loyalty programs can erect barriers to entry for competitors by leveraging accumulated customer data as a "data moat," which incumbents use to personalize offers and predict behavior in ways new entrants cannot replicate without similar historical transaction records.^[205] This advantage stems from years of program data collection, enabling targeted retention strategies that raise rivals' customer acquisition costs and deter market entry, as analyzed in antitrust discussions of unilateral conduct.^[206] Additionally, programs impose switching costs on participants through accumulated points or status, further entrenching incumbents and limiting competitive expansion.^[207] Tiered loyalty structures, where benefits escalate with spending thresholds, create disparities in access to discounts and perks, effectively segmenting the market and disadvantaging lower-tier or non-participating consumers.^[67] High-value customers in elite tiers receive superior deals, such as exclusive pricing or priority access, which incumbents can withhold from rivals, widening competitive imbalances and potentially foreclosing smaller entrants from attracting premium segments.^[67] Economic models indicate this tiering reinforces inequality in bargaining power, as firms prioritize rewarding entrenched loyalty over broad price competition.^[67] Such programs distort pricing dynamics by enabling firms to maintain elevated base prices for non-members while offering targeted rebates to loyals, thereby softening overall price competition.^[208] Research demonstrates that hidden loyalty status obscures competitors' ability to undercut deals selectively, leading incumbents to sustain high margins across customer types rather than engage in aggressive discounting.^[208] Consequently, effective prices may rise for marginal or infrequent buyers, as non-loyalty rates increase to subsidize program incentives, per analyses of loyalty discount equilibria.^[209] Government inquiries, including Australia's 2019 review, have noted these effects reduce market fluidity and consumer choice.^[210]

Regulatory challenges and consumer manipulation claims

Loyalty programs have faced regulatory scrutiny in the European Union primarily under the Unfair Commercial Practices Directive (2005/29/EC), which prohibits practices that are contrary to professional diligence and materially distort consumer behavior. Authorities examine expiration policies for points or rewards, requiring clear disclosure of any time limits to avoid misleading consumers about the value or usability of accumulated benefits; failure to communicate such conditions transparently can render programs unfair if they induce purchases under false expectations of permanence. For instance, national enforcers, including those in member states like the Czech Republic, have initiated reviews of retail loyalty schemes to ensure terms do not exploit consumer inertia through opaque or punitive expiry rules.^[211] Consumer manipulation claims often center on "dark patterns"—interface designs that subvert user autonomy—allegedly embedded in loyalty program apps and enrollment processes. In January 2024, a coalition of consumer rights groups filed a complaint against Starbucks, accusing its mobile app of using deceptive elements, such as obscured opt-out options and urgency prompts tied to rewards, to nudge users toward higher spending for points accumulation. Similarly, the National Advertising Division (NAD) in March 2023 recommended modifications to Pier 1 Imports' rewards membership after finding pre-checked boxes and buried disclosures constituted dark patterns that tricked consumers into unintended enrollments. These tactics, drawing from behavioral economics, exploit cognitive biases like loss aversion, though empirical evidence on their net harm remains mixed: while designs demonstrably increase short-term engagement, studies indicate many rational consumers recognize and mitigate such nudges by tracking terms independently.^[212]^[213] Critics further allege that variable reward structures in loyalty programs mimic slot-machine mechanics, fostering overspending through intermittent reinforcement akin to the motivating-uncertainty effect, where unpredictable bonuses heighten dopamine responses and perceived value. Proponents of minimal regulation argue this encourages innovation in customer retention without proven widespread deception, as consumers often switch programs based on total utility rather than being irrevocably manipulated; regulatory overreach, such as blanket bans on variability, could stifle competitive differentiation. Nonetheless, agencies like the U.S. Federal Trade Commission have amplified scrutiny, citing rising sophistication in such patterns since 2022, prompting calls for clearer guidelines on reward devaluation or hidden conditions in program administration.^[214]^[215]^[216]

References

[1]
Loyalty Program: Definition, Purpose, How It Works, and Example
Loyalty programs, sponsored by retailers and other businesses, offer rewards, discounts, and other special incentives as a way to attract and retain customers.What Is a Loyalty Program? · How It Works · Purpose · Example
[2]
Loyalty programs: How they work, examples, and tips - Zendesk
Aug 11, 2025 · A customer loyalty program (or rewards program) is a customer retention strategy businesses use to entice customers to continue buying from them.Types of loyalty programs · examples of customer loyalty...
[3]
7 types of loyalty programs and their benefits - TechTarget
Dec 23, 2024 · 1. Tiered loyalty program · 2. Subscription-based or paid loyalty program · 3. Value-based loyalty program · 4. Points-based loyalty program · 5.
[4]
The Evolution of Loyalty Programs: From Stamps to Cutting-Edge Tech
The concept of loyalty programs dates back to the late 19th century when retailers started using trading stamps as an incentive for repeat business.
[5]
A History of Loyalty Programs, and How They Have Changed
Sep 14, 2018 · Some believe that the early roots of customer loyalty programs started with “premium marketing” in the late 18th century.
[6]
Loyalty Program, Membership Or Subscription: What's The Difference?
Sep 5, 2024 · A loyalty program is a marketing tool, designed to increase customer retention and repeat business. It helps companies reward and encourage customer loyalty.
[7]
Do Customer Loyalty Programs Really Work?
Loyalty programs and other marketing tactics such as price cuts and promotions are effective only in the long term, to the extent that they entice more ...
[8]
Analyzing the impact of loyalty card programs on customer behavior
Aug 23, 2023 · This study aims to analyze the impact of loyalty card programs on customer behavior in the Albanian market.
[9]
Loyalty Programs and Customer Expectations Are Growing | BCG
Dec 9, 2024 · People are more loyal to programs if the company teams with partners that are a good fit with its brand or purpose, providing valuable, ...
[10]
Members only: Delivering greater value through loyalty and pricing
Apr 3, 2024 · On their own, loyalty programs can be helpful tools to drive long-term engagement and stickiness. Pricing can be a very effective way to ...
[11]
The True History Of Loyalty Programs
Loyalty programs have been around for hundreds of years, with approaches becoming more sophisticated over time. This article chronologically details the ...
[12]
As Good As Little 'Bits,' Tokens Were a Big Hit - HistoryNet
May 15, 2018 · Groceries, bakeries and ice companies all provided tokens. There were tokens for a ride on a streetcar, a meal, a shave and a bath. In fact, the ...
[13]
The Use of Private Tokens for Money in the United States - jstor
Tokens issued from 1800 to 1861, 608. - War of 1812 period, 608. - Jacksonian era,. 611. - Gold tokens, 617. - Georgia, 617. - North Carolina ...
[14]
Trading Stamps | Encyclopedia.com
The most prominent trading stamps were S&H Green Stamps, first issued by the Sperry & Hutchinson (S&H) Company in 1896. Other major trading-stamp brands ...
[15]
The Surprising History Of Loyalty Programs
May 26, 2021 · The first company to introduce these stamps was Schuster's Department store in Milwaukee in 1891. Customers received one stamp for every US $.
[16]
History of S&H Green Stamps
Founded in 1896, S&H Green Stamps were popular in the 1960s, then declined, reintroduced in 1999, and are now back with a new model.
[17]
S&H Green Stamps Had Consumers Saving By the Book
Jun 30, 2021 · “S&H” symbolizes the Sperry & Hutchinson Co, which Thomas Sperry and Shelley Byron Hutchinson established in 1896. S&H Green Stamps became the ...
[18]
History of Loyalty - From Ancient Virtue to Modern Programs
Sep 25, 2025 · Loyalty is a concept as old as civilization itself, deeply woven into the fabric of human relationships, governance, and commerce.
[19]
This History of Loyalty Programs, Part One - Kobie Marketing
Jun 22, 2015 · One of the first such national programs was S&H Green Stamps, launched in 1896. Green Stamps and their imitators allowed customers to ...<|control11|><|separator|>
[20]
AAdvantage Celebrates 40 Years of Loyalty Innovation
Apr 5, 2021 · When the AAdvantage program began on May 1, 1981, membership was by invitation-only and rewards included a first-class ticket to any destination ...
[21]
Airline Deregulation: When Everything Changed
Dec 17, 2021 · In 1978, Congress passed a law allowing airlines to set their own fares and routes, an event that transformed the commercial airline ...
[22]
[PDF] THE MYTH OF “DEREGULATION” IN AIR TRANSPORTATION
Deregulation also spurred new service features, such as frequent flyer programs, computer reservation systems, and alliance arrangements offering seamless ...
[23]
the voice of the loyalty marketing industry since 1990 - SEC.gov
According to Cardweb.com, 40 percent of all Visa and MasterCard issuers now operate a rewards program tied to their credit card offering. COLLOQUY estimates ...Missing: transformation | Show results with:transformation
[24]
Rewards Reimagined: A Decade and a half of Transformation in ...
Mar 2, 2025 · The early 2000s brought further innovation with Card Linked Offers (CLOs) and the impact of e-commerce, which enabled more personalized rewards ...
[25]
Starbucks: Winning on rewards, loyalty, and data
Feb 9, 2020 · The Reward Program is available on mobile devices as the Starbucks app, and has seen impressive membership and growth since 2008, with multiple ...Missing: 2000 | Show results with:2000
[26]
Rewarding Our Customers | Starbucks Archive
The programs combined in 2009 to create My Starbucks Rewards, with welcome, green and gold levels. Now integrated within our mobile app, the program is still ...Missing: 2000 | Show results with:2000
[27]
2025 EY Loyalty Market Study
To enable hyper-personalization at scale and create uniquely tailored experiences for each customer, brands need to define their target customers and understand ...
[28]
Loyalty Program Trends: Global Customer Loyalty Report 2025
Jan 23, 2025 · Consumers: 39.6% of consumers would be more likely to join a loyalty program if it had AI. · Companies: 37.1% of program owners use AI to manage ...
[29]
What is Closed Loop Loyalty? A Complete Guide - Leat Blog
Closed loop loyalty programs help businesses keep customers longer by giving them personalized rewards and experiences. When customers get offers that match ...
[30]
Coalition vs Proprietary Loyalty Programs - The Wise Marketer
Feb 10, 2021 · We describe this as having a higher “earning velocity”, where coalition members can earn rewards at faster rates than they could by collecting ...
[31]
How Walmart Enhances Customer Experience (CX) with Digital and ...
Sep 6, 2024 · According to Walmart's internal data, Walmart+ members spend 35% more than non-members, illustrating the program's success in boosting customer ...
[32]
Walmart's Strategic Reinvention: How Pricing Power and Customer ...
Aug 21, 2025 · Walmart's success in retaining customers hinges on more than just low prices. The Walmart+ membership program, with 40 million subscribers, ...
[33]
Sephora's Secret Sauce: Exclusive Experiences over Discounts
Oct 12, 2025 · ... retention. With more than 45 million members, Sephora's multitiered Beauty Insider ... rate,” Berlind said. “They're really into beauty and ...
[34]
Does Customer Loyalty Boost Retention Rates? - Reward the World™
Sep 3, 2024 · Sephora's Beauty Insider: This tiered loyalty program has helped Sephora achieve a retention rate of 80%, well above the retail industry average ...
[35]
https://freeyourself.com/blogs/news/beauty-brand-loyalty-program-statistics
[36]
What Is a Coalition Loyalty Program - Growave
Sep 2, 2025 · Short answer: A coalition loyalty program is a shared rewards system where multiple non-competing brands let customers earn and redeem points ...
[37]
Creating a Coalition Loyalty Program: a Full Guide - Antavo
“When done well, a coalition programme offers the benefits of flexibility, affordability and visibility for merchants, and for customers, they offer speed and ...
[38]
About Us | Read About Our Story So Far - IAG Loyalty
1988. Air Miles launches, the UK's first travel loyalty programme ; 1991. Iberia Plus launches ; 1994. British Airways acquires Air Miles ; 1998. Birchwood opens – ...Missing: structure | Show results with:structure
[39]
About us - Air Miles
Launched in Canada in 1992, the AIR MILES Reward Program is owned and operated by AIR MILES Loyalty Inc. For more information, visit loyalty.com.
[40]
Nectar Loyalty Programme - Nectar360
Nectar's unique coalition model brings together some of the nation's biggest and best brands in one digital-first programme. We deliver personalised, ...
[41]
The Power of Coalition Loyalty in a Shifting Economy - Nectar360
Nectar's coalition loyalty model, now 22 years old, has stood the test of time, consistently empowering its members to earn and redeem value across their ...
[42]
Coalition Loyalty Programs: Successes and Failures
Jul 3, 2024 · Research shows well-structured coalition programs can significantly enhance customer loyalty and retention rates. The key lies in carefully ...
[43]
Cross-reward effects in a coalition loyalty program: The impact of a ...
We show that cross-reward effects changed (lessened), leading to larger financial losses for the most popular stores.
[44]
Coalition Loyalty Programs: Benefits and Best Practices for ...
Oct 1, 2024 · Nectar operates on a system where it receives payment for each point issued to customers, reimbursing brands when those points are redeemed.What are Coalition Loyalty... · How to Create a Successful...
[45]
Preparing for loyalty's next frontier: Ecosystems - McKinsey
Mar 5, 2020 · At the same time, brands must be open to the trade-offs inherent in an ecosystem-based loyalty partnership. Ecosystem-centric loyalty may ...
[46]
Identification of Loyalty Program Members: Are Cards Still a Thing?
Mar 29, 2023 · Historically, loyalty program members have used paper or plastic cards to identify themselves during a transaction. For years, such cards were ...Missing: enrollment methods
[47]
Loyalty program implementation: a step-by-step guide
Rating 4.8 (15) Make sure every customer can be quickly identified as a loyalty member at the point of sale. If it's through phone number, email, membership ID, or app QR ...
[48]
[PDF] The 2024 EY Loyalty Market Study
Top channels for program enrollment are digital, with 63% of respondents most recently enrolling in a loyalty program through a brand's mobile app or website.
[49]
The Evolution of Customer Loyalty Programs - PaySimple
Discover how customer loyalty programs evolved during the pandemic and why contactless payments are key for merchants going forward.
[50]
https://www.wishtv.com/news/local-news/krogers-data-collection-practices/
[51]
Tricky Trade-off: Are loyalty cards compromising your privacy? - WCAX
Nov 13, 2017 · Consumers need to know they are giving up their privacy. That's the trade-off. You're allowing intense digging into your spending habits in exchange for those ...
[52]
The ethics of loyalty cards: dodgy pricing and data collection
Sep 4, 2024 · Privacy campaigners strongly believe loyalty cards could easily become the gateway for personal data exploitation under the guise of cost-saving ...
[53]
Points-Based Loyalty Programs: How Do They Work? - Arrivia
Dec 14, 2023 · A loyalty points program is a rewards system where customers earn points based on specific actions or purchase amounts.
[54]
Top loyalty features: 6 effective loyalty mechanics from leading brands
Rating 4.8 (15) Effective loyalty features include point systems, tiered rewards, reward catalogs, vouchers/coupons, referral programs, and gamification elements.Top Loyalty Program Features... · Reward Catalogs · Vouchers And Coupons
[55]
How To Determine The Points Model For Loyalty Programs
Apr 11, 2025 · 1. Define the Earn Rate · 2. Determine the Redemption Value · 3. Compare with Competitors · 4. Calculate Break-Even and Profitability.
[56]
Guide to Loyalty Points Expiration – Should You Do It and How?
Without any limits placed on the number of loyalty points and no points expiration date, companies can risk higher chances of fraud and liabilities.Missing: thresholds | Show results with:thresholds
[57]
Breakage: Good or Bad for Loyalty Programs? - Travel Data Daily
Many retail loyalty programs have breakage rates as high as 80% or more. This means that 80% of points expire without being redeemed. So the points end up ...
[58]
Points Expiration Strategies: Balancing Customer Satisfaction and ...
May 14, 2025 · Properly implemented expiration policies typically increase overall redemption rates by 15-25%, improve program participation by 10-20%, and ...Customer Experience... · Expiration Strategy Options... · Implementation In Shopify<|control11|><|separator|>
[59]
Leveraging the Loyalty Margin: Rewards Programs That Work
For example, our research shows that a loyalty program that costs 3 percent of revenues breaks even at a 10 percent incremental share and generates 100 percent ...
[60]
https://blog.brandmovers.com/mastering-loyalty-program-optimization-redemption-rates
[61]
Study Shows Loyalty Programs Increase Purchases by 20%
A study showed customers in a loyalty program spent 68% more with instant rewards, and saving for bigger rewards also increased spending.
[62]
Must-know brand loyalty and customer rewards program statistics
The top performing loyalty programs boost revenue from customers who use them by 15-25% annually. Over 83% of consumers say belonging to a loyalty program ...Customer Loyalty And Loyalty... · Customer Retention... · Business Revenue Statistics
[63]
[PDF] Feeling Superior: The Impact of Loyalty Program Structure on ...
Our research studies the status that firms bestow on customers within the hierarchies created in the firms' loyalty programs. Firms are increasingly segregating ...
[64]
(PDF) Multi-Tier Loyalty Programs to Stimulate Customer Engagement
May 14, 2022 · Building on loyalty program and customer prioritization research, we discuss whether, why, and how multi-tier loyalty programs are effective ( ...
[65]
Why your loyalty program should charge a fee - PR Daily
Nov 15, 2021 · Why your loyalty program should charge a fee · Differentiates your brand. Members of paid programs purchase more frequently and are more likely ...
[66]
The Psychology Behind Loyalty Programs - SaaSquatch
When combined with the loss aversion effect, customers will go to great lengths to maintain their VIP status if it's questioned or at risk of being taken away.
[67]
Refocusing loyalty programs in the era of big data: a societal lens ...
Jun 2, 2020 · First, the reward structure of LPs can increase inequality. For example, status and reward tiers create a hierarchy among consumers by providing ...
[68]
To Tier Or Not To Tier: Evaluating A Tiered Loyalty Program - Forbes
Feb 14, 2025 · Potential Downsides When Introducing Tiers In Your Loyalty Program · Complexity And Confusion · Exclusivity Backlash · Cost And Resource Management.
[69]
[PDF] Can Non-tiered Customer Loyalty Programs Be Profitable?
Non-tiered loyalty programs can increase customer value by almost 30% over five years, mainly due to reduced attrition, with minimal impact on spending per ...Missing: uplift | Show results with:uplift
[70]
How Much Cashback Should I Give in My Loyalty Program? - Toki
Mar 10, 2025 · A good rule of thumb: Keep cashback at 10-20% of your profit margin per sale. For a $30 profit, that's $3-$6 back.
[71]
Guide: Cash-Back vs Points-Based Rewards for Retailers - Marsello
Benefits and Drawbacks of Points-Based Programs · Complexity: Customers may find it harder to understand the value of their points compared to cash-back.
[72]
(PDF) 40 years of loyalty programs: how effective are they ...
We perform a comprehensive meta-analysis of loyalty programs across various LP designs and industries and spanning different performance metrics to identify ...
[73]
How cashback strategies yield financial benefits for retailers
Results demonstrate that cashback generation and retention increase consumer's loyalty towards the cashback. Second, program loyalty is a strong driver of ...
[74]
Loyalty Programs: Generalizations on Their Adoption, Effectiveness ...
Aug 9, 2025 · We conclude that LPs are effective in increasing consumer purchase behaviors over time, but their impact differs across consumer segments and markets.
[75]
Why Customer Loyalty Programs Can Backfire
When loyal members encounter service failures—shipping issues, problems with returns, stockouts, and the like—they get more upset than customers who are not ...
[76]
https://www.amworldgroup.com/blog/airline-loyalty-programs
[77]
The Future of Airline Loyalty Programs | Future of Travel - OAG
May 20, 2024 · American Airlines pioneered customer loyalty in the airline industry with the launch of the AAdvantage program in 1981. This initiative marked ...
[78]
Mission: Loyalty — The Secret Behind Experiential Rewards - Antavo
These types of rewards generate short-term loyalty. Soft benefits, which include experiential rewards, create long-term brand love. They are usually harder to ...
[79]
Why Traditional Loyalty Programs Are Being Outperformed by ...
Rating 9.5/10 (20) Mar 28, 2025 · Discover how experiential rewards outperform traditional cashback programs in fostering loyalty. Learn how unique gifts create lasting ...
[80]
[PDF] 2025 EY Loyalty Market Study
Jun 3, 2025 · Companies have much to learn from customer insights and should strive for a deeper level of understanding through hyper- personalization, which ...
[81]
Transforming Loyalty Programs: Transactional to Experiential
Apr 12, 2024 · 5x cheaper to retain existing customers than to generate new customers. Loyalty programs reduce churn, with 79% of customers saying they are ...Traditional Loyalty Schemes · Changing Motivations · Experience Is The Real...
[82]
5 key stats on loyalty programs and how data-driven insights can ...
Jul 17, 2024 · Key stat: 60% of loyalty program members prefer using a mobile app to access their programs, while 22% don't have a preference and will use ...
[83]
Maximize App Engagement with Push Notifications - InterTech Media
Apps using push notifications see up to 4x better retention rates, according to research by Localytics. Users who opt into push alerts are more likely to engage ...Missing: program | Show results with:program
[84]
Why Edge AI-Driven Personalization Is The Key To Customer Loyalty
Aug 6, 2024 · A 2024 Deloitte Digital report found that over eight in ten brands predicted they'll offer personalized rewards through their loyalty programs, ...
[85]
Mobile Apps are Key to Customer Loyalty - Bryj
May 21, 2024 · Research shows that app users demonstrate a 23% higher retention rate than non-app shoppers after the first 3 months. This shows that mobile ...
[86]
Mobile Apps for Loyalty Programs: Why Do You Need One? - Spoonity
May 2, 2024 · 72% of consumers who use mobile loyalty apps are more likely to make repeat purchases (McKinsey & Company, 2021); 65% of consumers who use ...
[87]
Why and How to Run a Punch Card Loyalty Program? - Voucherify
Nov 20, 2024 · Traditionally, customers received a physical card stamped with each McCafé purchase, rewarding them with a free beverage after a set number of ...Benefits Punch Card Loyalty... · 1. Starbucks Rewards · 2. Krispy Kreme's...
[88]
Loyalty Programs: A Deep Dive into Traditional and Digital Approach
Dec 26, 2024 · Traditional loyalty programs rely on physical rewards, often in the form of punch cards, stamp cards, or points-based systems.10 Customer Loyalty Trends... · 6. Gamified Loyalty Programs · 9. Premium Loyalty ProgramsMissing: methods | Show results with:methods
[89]
Physical vs Digital Loyalty Cards: Choosing the Right Solution for ...
Mar 24, 2024 · A common hybrid model involves offering traditional cards for in-store use while providing digital access through QR codes or simple phone ...
[90]
Complete Guide to Designing a Successful Hybrid Loyalty Program
Nov 4, 2024 · A hybrid loyalty program combines digital and traditional engagement methods for a comprehensive customer rewards experience.
[91]
Loyalty Program Accessibility for All Customers - Loyal-n-Save
Sep 29, 2025 · Small businesses can make their loyalty programs accessible using physical tools like punch cards, offering digital incentives or exclusive ...
[92]
Punch Cards vs. Digital: Reasons To Invest in Digital Customer Loyalty
Oct 19, 2023 · Physical punch cards have several inherent vulnerabilities that make them susceptible to fraud and abuse.
[93]
[PDF] Loyalty Schemes in Retailing - OAPEN Library
Let us imagine the simple example where a grocery retailer wants to increase turnover through targeted promotions. Different approaches exist to resolve ...
[94]
Target Boosts 9% Digital Sales with Loyalty Program Enhancements
Jan 23, 2025 · Target has revamped its Target Circle loyalty program, introducing three tiers aimed at maximizing consumer engagement and value.
[95]
Grocery loyalty programs that offer simpler, better redemption drive ...
Jul 10, 2024 · Grocery loyalty programs that offer simpler, better redemption drive higher customer engagement: Study · Consumers want choices, but lack options.
[96]
Next in loyalty: Eight levers to turn customers into fans | McKinsey
Oct 12, 2021 · Our research has found that top-performing loyalty programs can boost revenue from customers who redeem points by 15 to 25 percent annually.Missing: empirical | Show results with:empirical
[97]
Research Focus: Effectiveness of Grocery Retail Loyalty Programs
Sep 10, 2019 · This article reviews a large-scale study of grocery retail loyalty programs across 358 brands in 27 countries to identify what works and ...Missing: Target Circle apps empirical
[98]
The Evolution of Frequent-Flyer Programs - The Points Guy
May 20, 2021 · Southwest created a mileage program called The Company Club in June 1987 and then renamed it Rapid Rewards in 1996, which was more on-the-nose.
[99]
Frequent flyer programs: The most profitable part of the airline ...
Sep 8, 2024 · American Airlines reported revenue of $5.2 billion from co-branded cards and other partnerships. United reported a mere $3.2 billion on its ...
[100]
The Economics of Frequent Flyer Programs: How Airlines ... - Atlys
Nov 29, 2024 · The primary way airlines monetize their frequent flyer programs is by selling miles to partners, especially credit card companies and banks.
[101]
[PDF] Are Frequent-Flyer Programs a Cause of the “Hub Premium”?
This paper estimates the relationship between frequent-flyer programs (FFPs) and fares at hub airports. I exploit the formation of partnerships that allowed.
[102]
Do Customer Loyalty Programs Really Work in Airlines Business?
The main aim of this paper is to identify what extends customer loyalty program work in customer retention, customer engagement, and revenue generation in ...<|separator|>
[103]
Airline Loyalty: The Financial Powerhouse at the Center of Airline ...
Loyalty programs have proven to be valuable financial assets for airlines, yielding high margins, superior profits, steady cash flows, and resilience.
[104]
Best hotel rewards programs: How to choose in 2025 - The Points Guy
Jun 5, 2025 · The article reviews the top hotel loyalty programs for 2024, highlighting their strengths, ideal audiences and unique features.
[105]
10 best hotel loyalty programs and how to set up your own - Mews
May 7, 2024 · 1. Marriott Bonvoy. The Marriott Bonvoy gives points on hotel stays, dining and car rental. · 2. Hilton Honors · 3. World of Hyatt · 4. IHG One ...
[106]
Airlines face government scrutiny over devaluation of frequent flyer ...
Jan 1, 2024 · The Department of Transportation is examining whether airlines have been making promises about the value of the miles but then later tweaking the fine print.
[107]
Why Your Airline Miles, Credit Card Rewards Keep Being Devalued
May 8, 2025 · Any good loyalty program comes with the risk of people milking too much out of it, at least from the airline's point of view. This has prompted ...
[108]
Casino Comps: How The Comp System Works
Aug 31, 2024 · Casino operators base comps on that theoretical loss. A percentage of it is rebated to players as meals, rooms and so on. Bigger bettors and ...
[109]
Casino THEO and Average Daily Theoretical – ADT - TravelZork
Jul 20, 2021 · So, theoretically, if you played $5000 through the machine, your average loss would be $23 and you would earn $10 in comps and $5 in bounce-back ...
[110]
Seeking a detailed understanding of the mysterious MGM Comp ...
Dec 14, 2024 · The biggest factor MGM uses in their comp calculation is average trip theoretical loss. ... New MGM Rewards Member - Casino comps question.ELI5 How to Get Comps from Casinos : r/vegas - RedditWorking the comp system with a partner. Advice needed. : r/vegasMore results from www.reddit.com
[111]
[PDF] The long-term impact of a loyalty program: An evaluation from a Las ...
Few empirical studies attempted to evaluate the value of loyalty programs but the findings have been conflicting with each other. Given the competitive climate ...<|separator|>
[112]
Improving Casino Performance Through Enhanced Loyalty Programs
Aug 6, 2025 · The results indicated that the loyalty program variable significantly increased slot coin-in at a rate of $302,455 per day, but did not ...
[113]
The Impact of Casino Loyalty Programs on Player Retention
Mar 26, 2025 · According to a 2023 study by the American Gaming Association, casinos that adopt effective loyalty programs see a 30% rise in subsequent visits ...Missing: empirical | Show results with:empirical
[114]
5 Loyalty Program Lessons to Learn From Gaming Rewards - Antavo
Gaming rewards are a web of in-game incentives used by video games to build player loyalty and retain and encourage day-to-day engagement.
[115]
Top 3 Best Customer Loyalty Programs For Games - Helika
Top 3 Best Customer Loyalty Programs For Games ; 1.1. 1. Xbox Live Rewards ; 1.2. 2. Amazon Prime Gaming Rewards ; 1.3. 3. Playstation Stars.
[116]
[PDF] LOYALTY PROGRAMS IN THE GAMBLING INDUSTRY - Greo
In this REA, I review empirical evidence that speaks to who is most likely to join a loyalty program as well as the factors that facilitate and hinder perceived ...
[117]
Loyalty programmes in the gambling industry: potentials for harm ...
This article reviews the scant empirical literature, with an aim to stimulate discussion and research about the impact of loyalty programme membership on ...
[118]
Restaurant Loyalty Program Trends and Statistics for 2025 - iOrders
Apr 30, 2025 · 68% of full-service restaurants and 71% of quick-service establishments offer a loyalty program. This number is expected to reach 80% by the end of 2025.
[119]
Food & Beverage Loyalty Programs: 2025 Best Practices - Yotpo
Oct 15, 2025 · This guide gives you a clear look at the best practices for creating a food and beverage loyalty program that works in 2025, helping you turn ...
[120]
Starbucks Rewards: A Loyalty Program Case Study - LoyaltyLion
Oct 12, 2025 · Starbucks Rewards is a loyalty program with a simple, but effective, points-based system. Members can sign up for free and start collecting member points.Missing: 2000 | Show results with:2000
[121]
Restaurant Customer Retention Statistics – Data, Trends & Loyalty ...
Jun 25, 2025 · In the restaurant industry, the rate of customer retention is at 55%, lower than most industries. 2. Is 70% a good retention rate?
[122]
5 Restaurant Loyalty Program Ideas to Reward Customers
For example, if you run a cafe, consider awarding customers points for any drink over $5, rather than only for a coffee purchase. And, make your rewards more ...Benefits of a Restaurant... · Restaurant Customer Loyalty...
[123]
Restaurant loyalty programs: 10 successful examples (2025)
Rating 4.8 (15) Another successful example of a restaurant loyalty program is MyPanera Rewards by Panera Bread Company. Panera Bread was once the favorite place for Americans ...
[124]
Disloyalty Card: 6 north-east cafes team up for new scheme
Aug 9, 2023 · The disloyalty cards can be collected at north-east cafes Figment, Mount, Foodstory, Dreamy Goat Coffee Co and Coffee Apothecary.Missing: quick | Show results with:quick
[125]
Curious coffee drinker? This (dis)loyalty card is for you.
Jan 6, 2014 · Here's the list of coffee shops where your disloyalty can be rewarded. Peregrine Espresso · Blind Dog Cafe · La Mano · Filter Coffeehouse · The ...Missing: quick restaurants
[126]
9+ Restaurant Loyalty Program Statistics: A Must-Know in 2025
Mar 15, 2025 · 57% of restaurants have reward and loyalty programs. Loyalty program members visit restaurants 20% more frequently and spend 20% more than non- ...
[127]
Loyalty Breakage Definition - Voucherify
Some studies have reported average breakage rates ranging from 5-30%, while others have reported higher or lower rates. For instance, retail loyalty breakage is ...
[128]
Point Breakage in Loyalty Programs: Understand Its Impact
Feb 20, 2024 · For example, B2B brands might see average breakage rates of up to 70-85%, if it goes above this, then it's alarming.Missing: statistics | Show results with:statistics
[129]
[PDF] A META-ANALYSIS ON LOYALTY PROGRAM MEMBERSHIP ...
This study addresses this gap in the literature using meta-analysis to assess the relative importance of loyalty program effects on different customer outcomes.
[130]
Loyalty programs boost businesses' ability to keep customers
Apr 14, 2020 · In business, simple loyalty programs can strongly increase customer retention, Washington University in St. Louis researchers have found.
[131]
New loyalty program analytics lead to better strategies
Feb 28, 2023 · New approaches to analyzing customer behavioral patterns are leading to better strategies and are the key to unlocking the value of loyalty programs.
[132]
117 Staggering Loyalty Program Statistics for 2025 - Queue-it
Sep 2, 2025 · 78% of loyalty program owners think diverse reward redemption options have a positive impact on customer retention and satisfaction. Access ...
[133]
Stockpiling Points in Linear Loyalty Programs - Valeria Stourm, Eric ...
Apr 1, 2015 · Customers often stockpile reward points in linear loyalty programs (i.e., programs that do not explicitly reward stockpiling) despite ...
[134]
Loyalty Program Redemption Rates: How to Calculate and Improve ...
Jul 12, 2024 · It's calculated by dividing the number of rewards redeemed by the total rewards earned. Redemption rates are important to measure because they ...Missing: profitability break-
[135]
The Top 221 Customer Loyalty Statistics for 2025 and Beyond - Antavo
Aug 4, 2025 · Elevate your loyalty strategy with top-notch insights from 221 loyalty statistics of 2025. Dive in now to revolutionize your approach.
[136]
40 years of loyalty programs: how effective are they ...
Sep 8, 2021 · We find strong evidence that LPs enhance customer loyalty. However, while LPs particularly enhance behavioral loyalty, shifting consumers' attitudinal loyalty ...
[137]
US Retail Loyalty Programs 2024 - eMarketer
May 15, 2024 · Key Stat: US consumers held an average of 17.9 loyalty program memberships in 2023, a record high, and actively participated in 50% of them.
[138]
and long-term effects of promotional incentives in a loyalty program ...
The authors found that this type of LPs leads to an increase of approximately 30% in 5-year customer value, and more than 80% of the increase can be explained ...
[139]
[PDF] Understanding The Boomerang Effect of Loyalty Programs
The core hypothesis of our study focused on the potential diminishing returns of loyalty program investments. What we found was surprising. Loyalty program can ...
[140]
Asia Pacific Loyalty Programs Intelligence Report 2025
Sep 9, 2025 · The loyalty market in Asia Pacific is expected to grow by 16.3% on annual basis to reach US$35.83 billion in 2025. In value terms, the loyalty ...Missing: patterns | Show results with:patterns
[141]
The history of loyalty point culture in Japan - SupremeTech
Oct 1, 2025 · ... T-Point, Japan's first large-scale coalition loyalty program. Suddenly, customers could earn and spend points not just in one store, but ...
[142]
Japan Loyalty Programs Market Intelligence Report 2023: A $16.74 ...
Aug 4, 2023 · The loyalty market in Japan is expected to grow by 12.5% on annual basis to reach US$10657.4 million in 2023. In value terms, the loyalty market ...Missing: T- | Show results with:T-
[143]
Asia Pacific Loyalty Programs Business Report 2025
Feb 18, 2025 · Japan's T-Point and Ponta and Australia's Flybuys are among the few coalition-style programs, leaving most businesses to develop independent ...
[144]
Asia's Loyalty Landscape - Changing Customer Engagement in East
Jul 21, 2025 · With 97% smartphone penetration and some of the highest mobile usage ... This mobile-first culture powers loyalty ecosystems. Super-apps ...
[145]
Asia-Pacific Loyalty Management Market Size & Share Analysis
Oct 10, 2025 · By loyalty program type, business-to-consumer schemes held 37.73% of the Asia-Pacific loyalty management market share in 2024, while coalition ...
[146]
https://www.marketwatch.com/press-release/asia-pacific-loyalty-programs-intelligence-report-2025-market-to-grow-by-16-3-to-reach-35-83-billion-this-year-future-growth-dynamics-to-2029-researchandmarkets-com-cf2d2130
[147]
Emotional Loyalty in Asia Pacific: Overcoming Point Liability
Oct 13, 2023 · Almost one in three Asia Pacific respondents join loyalty programmes to stay connected to a brand they love, higher than the global average.Missing: empirical | Show results with:empirical
[148]
The Impact of Cultural Values on Loyalty Program Choice
Aug 6, 2025 · The authors develop and test theory proposing that cultural values influence loyalty program choice. The results indicate that cultural differences matter.
[149]
How the GDPR affects loyalty programmes - IT Governance Blog
Apr 13, 2018 · GDPR affects loyalty programs by requiring a lawful basis, limiting data use, data security, and preparing for individuals' rights to access ...
[150]
Navigating Loyalty Program Regulation & Compliance - Arrivia
Jul 1, 2024 · The General Data Protection Regulation (GDPR) influences how loyalty programs in the European Union (EU) collect and store consumer data.
[151]
How GDPR Affects Loyalty Programs and Personalized Marketing ...
Some global firms have chosen to limit or suspend European loyalty programmes until compliance can be fully ensured. Others have invested significantly in ...
[152]
Channel 4 and Nectar360 sign pioneering data partnership
The innovation enables FMCG clients to accurately target customers in a GDPR compliant way, utilising segments created by Nectar360 which groups customers with ...
[153]
How data protection builds customer trust and loyalty - DPO Centre
Oct 28, 2024 · Data protection builds trust through transparency and Privacy by Design, which are vital for customer loyalty and brand credibility.
[154]
Airlines Want a Piece of Every Purchase You Make
Sep 6, 2025 · The biggest U.S. airlines make billions of dollars from their loyalty programs and branded credit cards, which some analysts believe are now ...
[155]
Airline rewards rankings 2025: These programs offer the best ...
Sep 10, 2025 · Airline rewards rankings 2025: These programs offer the best points value, flight change and cancellation perks. American, Alaska, and United ...
[156]
Protect Our Points - Airlines for America
These programs allow airlines to reward their most loyal customers with perks such as free checked bags, upgraded seats, priority status and even free trips and ...
[157]
Canada Loyalty Programs Market Intelligence Report 2025-2029
Sep 9, 2025 · The Canadian loyalty market is poised for significant growth, expected to reach $1.78 billion by 2025 with a 14.6% CAGR.
[158]
The Untapped Potential of Customer Loyalty Plans
Dec 4, 2024 · By Deborah Aarts | Dec 4, 2024 ... Loyalty programs have become so prevalent that the average Canadian is now a member of 14 programs.
[159]
Canadians want access, tangibility in loyalty programs: expert
Jul 29, 2025 · An increasing amount of Canadian companies are creating loyalty programs to retain customers and grow market share, and while each new ...
[160]
Latin America Loyalty Programs Market Databook 2025:
Feb 19, 2025 · The loyalty market in Latin America is expected to grow by 17% on annual basis to reach US$5.09 billion in 2025. In value terms, the loyalty ...
[161]
https://www.statista.com/topics/2453/e-commerce-in-latin-america/
[162]
Latin America Loyalty Programs Market Intelligence Report 2024-2028
Oct 11, 2024 · The loyalty market in the region will continue to grow over the forecast period and is expected to record a CAGR of 9.8% during 2024-2028.
[163]
The Future of Loyalty Programs: US Trends for 2025 - Comarch
Mar 6, 2025 · What's next for US loyalty programs? Discover 2025 trends based on market research, including hyper-personalization, data privacy, ...
[164]
Hyper-Personalized Loyalty Programs 2025 - Nector.io
Feb 13, 2025 · Hyper-personalization has emerged as a pivotal strategy for US brands seeking to redefine loyalty programs in 2025.Missing: hybrid North
[165]
The Ultimate Guide to Flybuys - Point Hacks
Jun 19, 2025 · Flybuys is a big loyalty program that's affiliated with Coles and Virgin Australia – but it also has many more partners.
[166]
Fly Buys program introduced - Australian food history timeline
A million Australian households joined within the first six weeks. Fly Buys remains Australia's largest loyalty program, with more than 10 million cardholders ...
[167]
Australia Loyalty Programs Market Report 2025 - ALA
Feb 11, 2025 · Over 86% of Australian consumers are members of at least one loyalty program, and around half actively engage with them.Missing: Oceania Zealand
[168]
The Australia Loyalty Solutions Market Map - Ellipsis
Australia's loyalty market is worth US$4bn and it's growing at 13% annually. With a GDP similar to Canada's, it's also highly concentrated with two grocers, 2 ...
[169]
[PDF] Earning the loyalty of New Zealand's modern-day digital customer
Loyalty programmes are par for the course for many New. Zealand retailers and banks. In fact, 97% of Kiwis are members of some form of retail loyalty programme.
[170]
Call me loyal, I'll hold you loyal too - New Zealand Marketing ...
Oct 13, 2023 · According to that study, the top 10 loyalty programmes in New Zealand, were, in order, AA Smartfuel, Countdown Onecard, Fly Buys, Air New ...
[171]
Africa Loyalty Programs Market Databook 2025, with - GlobeNewswire
Feb 25, 2025 · Regulatory and infrastructure challenges vary by country: Countries like Nigeria, South Africa, and Kenya have favorable digital payment ...
[172]
Middle East And Africa Loyalty Program Management System Market
Aug 6, 2025 · The level of technological infrastructure and internet penetration in various countries directly affects the implementation and scalability of ...
[173]
Africa Loyalty Programs Market Intelligence Report 2025-2029
Sep 5, 2025 · The African loyalty market is set to grow 18.1% annually, reaching $852.4M by 2025 and $1.52B by 2029, driven by mobile and fintech ...
[174]
Middle East Loyalty Programs Market Future Growth Dynamics ...
Mar 17, 2025 · The loyalty market in the Middle East will continue to grow over the forecast period and is expected to record a CAGR of 13.8% during 2025-2029.
[175]
Exploring The Top 5 Retail Loyalty Programs In The Middle East
Nov 14, 2024 · Top 5 Stand Out Loyalty Programs in The Middle East · 1. Amber · 2. Shukran Rewards · 3. Club Apparel · 4. MyClub · 5. SHARE Rewards.
[176]
Frequent Flyer Miles as Company Scrip: Implications on Taxation
Aug 6, 2025 · These popular programs have been the subjects of much discussion on whether or not the frequent flyer miles received by customers are taxable.Missing: parallels | Show results with:parallels
[177]
Scrip: Definition, Types, Common Examples, and Uses - Investopedia
A scrip is is a substitute or alternative to legal tender. Holding a scrip entitles the bearer to receive something in return.Missing: parallels | Show results with:parallels
[178]
Points, Miles, and Balance Sheets: How Loyalty Programs ... - LinkedIn
Oct 22, 2024 · These liabilities are recorded on the balance sheet as deferred revenue and are based on the fair value of the points/miles issued. Liability ...
[179]
7.2 Customer options that provide a material right - PwC Viewpoint
Customer loyalty programs are used to build brand loyalty and increase sales volume. ... accounting for breakage at RR 7.4). The reporting entity is ...<|separator|>
[180]
7.4 Unexercised rights (breakage) - PwC Viewpoint
Breakage applies to not only sales incentive programs, but also to any situations where a reporting entity receives prepayments for future goods or services.
[181]
What are Loyalty Currency and how do they work? - Leat Blog
Aug 4, 2025 · Loyalty currency is an alternative currency like points or credits, earned through purchases or engagement, and redeemed for rewards.
[182]
Mastering the Tide of Change: A Comprehensive Guide to Loyalty ...
Feb 29, 2024 · A perceived reduction in value can significantly erode brand loyalty and customer trust, underscoring the need for strategic management of these ...Missing: empirical | Show results with:empirical
[183]
The effects of loyalty programs on customer satisfaction, trust, and ...
This study examines the differential effects of the benefits customers receive from a loyalty program (LP) on satisfaction with the LP, trust in the LP, and ...
[184]
Making blockchain real for customer loyalty programs | Deloitte US
Discover how to reduce costs, gain efficiencies, and realize the full value of loyalty rewards programs by using blockchain.
[185]
Blockchain-Based Loyalty Management System - MDPI
Apr 27, 2023 · This paper explores the shortcomings of current loyalty programs identified through the literature review, and proposes a loyalty management system with ...2. Literature Review · 2.1. 2. Blockchain · 3. Proposed Loyalty...<|control11|><|separator|>
[186]
Can Blockchain Make Loyalty Marketing Programs Better?
Aug 21, 2025 · In December 2024, Loyalty Marketing launched a pilot program for Ponta Points, onboarding an initial 30,000 customers to a blockchain-based ...
[187]
How to Create an Efficient Loyalty Program with Blockchain
Dec 12, 2023 · Real-Life Examples: Starbucks: The company leverages blockchain in its loyalty program, offering more customized rewards through its mobile app ...Blockchain As A Solution · Benefits For Different... · Challenges And Solutions In...<|separator|>
[188]
(PDF) Blockchain for Loyalty Rewards Program Management
Nov 16, 2019 · We present recently reported case studies that have leveraged blockchain technology to provide aviation-centric services. Furthermore, we ...
[189]
The Blockchain Revolution For Loyalty Programs - Oliver Wyman
Blockchain could provide instant redemption and exchange for multiple loyalty point currencies on a single platform.
[190]
Case Studies in Token Success: Revolutionizing Customer Loyalty
Jun 5, 2025 · For example, a customer might earn 100 tokens for a purchase, which can be redeemed for rewards across various platforms. These tokens are ideal ...
[191]
Understanding Loyalty Program Privacy Risks - Cloaked
Nov 18, 2024 · Loyalty programs offer rewards but come with privacy risks. They collect personal data like names and shopping habits, raising concerns ...Missing: economic | Show results with:economic
[192]
[PDF] Impeding Individual User Profiling in Shopper Loyalty Programs
Unfortunately, in the pursuit of these savings, users often unknowingly sacrifice their privacy and allow themselves to be profiled.
[193]
Contextual integrity of loyalty programs, compromised? Interrogating ...
This study explores privacy issues complicated by the commodification of consumer health data in the United States by looking into loyalty programs (LPs).
[194]
Risks and rewards: Managing loyalty program privacy and security
Oct 28, 2024 · For example, in August 2023, Caesars Entertainment suffered a data breach that exposed sensitive personal information of a “significant number ...
[195]
How to protect yourself against rewards program data breaches
Jul 31, 2024 · Both Marriott Bonvoy and IHG One Rewards have been subjected to data breaches that affected millions of consumers, and the Equifax hack of 2017 ...
[196]
Company fined €3 million over Apotheka loyalty program data breach
Sep 5, 2025 · The leaked files contained the personal data (first and last name, personal identification code, language, gender, e-mail address, telephone ...
[197]
7 Loyalty Program and Rewards App Attacks - Dark Reading
The number of attacks targeting loyalty and rewards programs is growing. Here are some of the lowlights.
[198]
Radisson Suffers Global Loyalty Program Data Breach
Nov 2, 2018 · Radisson Hotel Group has suffered a data breach that resulted in the theft of data for its Radisson Rewards global loyalty program.
[199]
Here's what the Qantas cyber attack may mean for your data and ...
Jul 2, 2025 · Qantas is warning a "significant" amount of customer data has likely been stolen from its records during a cyber attack against the airline on Monday.<|separator|>
[200]
The trade-off between privacy and incentives - ScienceDirect
Although consumers are generally willing to share personal information when the anticipated benefits outweigh the perceived privacy risks (Ackermann et al ...
[201]
Privacy versus reward: Do loyalty programs increase consumers ...
Privacy versus reward: Do loyalty programs increase consumers' willingness to share personal information with third-party advertisers and data brokers?
[202]
Do Rewards Really Create Loyalty?
Customer rewards have been reviled in the business press as cheap promotional devices, short-term fads, giving something for nothing.
[203]
Customer Loyalty and Customer Loyalty Programs - ResearchGate
Aug 9, 2025 · However, empirical research shows that loyalty in competitive repeat-purchase markets is shaped more by the passive acceptance of brands ...
[204]
(PDF) Characterising the deal-proneness of consumers by analysis ...
Aug 6, 2025 · This study characterises the 'deal-proneness' of consumers by analysis of the consumer-level characteristics of price sensitivity and brand loyalty.
[205]
How to Build a Data Moat: A Strategic Guide for Modern Enterprises
Solution: By implementing loyalty programs that track customer purchases and ... These insights form an entry barrier for competitors, making the logistics firm's ...
[206]
Understanding Single-Firm Behavior: Loyalty Discounts Session
Commission. 9, This series is designed to help advance the. 10, development of the law concerning treatment of. 11, unilateral conduct under the antitrust laws.
[207]
[PDF] Loyalty Discounts and Rebates - Canadian Competition Law Review
Loyalty discounts and rebates may also have anti-competitive effects by raising switching costs for consumers and strengthening barriers to entry and expansion ...
[208]
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4377561
[209]
[PDF] The Economics of Loyalty Discounts and Antitrust Law in the United ...
Relative to the equilibrium without loyalty programs, the non-loyalty prices increase, so that small consumers are worse off with loyalty programs. Large.
[210]
https://www.accc.gov.au/about-us/publications/customer-loyalty-schemes-final-report
[211]
Balance Sheet Implications of Store Credit and Loyalty Points in E ...
Feb 1, 2025 · The EU Unfair Commercial Practices Directive requires that any conditions (like point expiry or limited usage) be communicated clearly to ...
[212]
Starbucks accused of 'manipulating' its mobile app users into paying ...
Jan 3, 2024 · A new complaint from a consumer rights coalition alleges that the company uses manipulative digital design features in its app to deceive rewards members.
[213]
NAD Finds Dark Patterns in a Rewards Program
Mar 10, 2023 · In its decision, NAD leaned on the FTC's “Bringing Dark Patterns to Light” report and the agency's .com Disclosure guidelines. To those who ...
[214]
Motivating-Uncertainty Effect - The Decision Lab
Motivating Uncertainty Effect is a psychological phenomenon where people are motivated more by uncertain rewards than by rewards of a certain magnitude.
[215]
Is It Loyalty or Habit? - Behavioral Economics Institute
May 18, 2021 · Variability means that sometimes the rewards may be unexpected or better than what the consumer anticipates. This activates the dopamine ...Missing: overspend | Show results with:overspend
[216]
FTC Report Shows Rise in Sophisticated Dark Patterns Designed to ...
Sep 15, 2022 · The Federal Trade Commission released a report today showing how companies are increasingly using sophisticated design practices known as “dark patterns”