The joy of loyalty
Shiona McDougall explores how brands can transform loyalty programs from transactional to relational, creating lasting connections with customers by sparking joy throughout their journey—especially in low-frequency categories like automotive and luxury goods.
I love a good loyalty program. I’m not especially analytical about which ones provide the best value for which purchases. I don’t obsessively chase points. I probably don’t get the most out of the programs I’m a member of. Loyalty programs just make me feel good for making lazy decisions and taking shortcuts when it comes to purchase choices. What’s not to like?
When I’m choosing where to stay for a family vacation, Marriott gets my business every time—less time spent trawling hotel options, and the joy of leveraging all the business travel I’ve had to do to pay for some well-earned downtime somewhere nice.
When I’m shopping for miscellaneous “stuff,” I feed my Amazon habit—and still get a tiny frisson of joy when I can have whatever thing I’ve decided I need tomorrow not next week using Prime. (Delayed gratification is not in my DNA. I would definitely fail the marshmallow test.)
Not all loyalty programs are created equal though. I spent years collecting “Honey” with PayPal with no real understanding to this day of what it is or what to do with it. Low purchase frequency categories in particular could do with going back to basics. Loyalty programs in the low purchase frequency space tend to be a bit “meh.” There’s very little joy.
For brands operating in low purchase frequency categories—think automotive, luxury goods, or home appliances—the traditional punch-card or points-for-purchases models of loyalty programs fall flat. If your customers only buy from you once every few years or even decades, how do you keep them engaged and spark joy in the everyday so they not only want to come back when they’re ready, but they advocate for your brand with their circle of friends and family? The opportunity lies in shifting from a transactional loyalty approach to a relational one.
The solution: loyalty as an engagement ecosystem that brings joy
Loyalty programs of the future will be less about rewarding purchases and more about driving ongoing engagement. It is likely that many transactional purchase decisions will be made by AI agents in the future—especially for high value purchases which tend to be more infrequent and more complex, and therefore justify going to the trouble of briefing AI to do the hard work for you. This means that the role of a loyalty programs becomes less about transaction and more about interaction. And if those interactions can spark joy, the real people behind every future purchase still have an important preference-influencing role to play.
For low-frequency sectors, the key is to build a loyalty program that offers value at multiple places in the customer’s journey—often in their everyday life outside of direct purchasing decisions. Think of it as creating and strengthening an enduring "brand relationship" rather than a building a "customer database." This is how CRM has operated for decades, and the time has come to bring the two often separate disciplines together.
CRM principles can power impactful loyalty evolution with 5 core principles
1. Understand your customer’s and prospect’s affinity for your brand at every step of their customer journey
Map out the customer journey and identify all the possible moments where your brand does and doesn’t bring joy. Put yourself into the shoes of your consumers and think way beyond the moment of purchase. For example, an automotive company might identify opportunities to engage customers during service intervals or when they’re researching vehicle accessories. Data can reveal what customers care about most and when they’re most likely to interact with your brand. Primary research plays a role here too—particularly to bring to life the joy (or lack of it) that is the reality of a customer’s experience with your brand.
2. Capture the right data that will enable natural, real-time interactions
Infrequent purchases mean you must maximize every interaction to learn more about your customer. Progressive data capture—collecting small bits of information over time—can help you enrich your customer profiles without overwhelming your customers with too many questions. For instance, a luxury furniture retailer could gather design preferences or lifestyle details during moments of reflection in between purchases. And don’t forget that there is joy to be had even in data collection if you get the right data value exchange!
3. Leverage your decisioning technology to deliver personalized experiences at scale.
Most businesses have already invested in Adobe, Salesforce, Pega, Braze or similar. Most businesses have not even scratched the surface of the potential of these tools. Setting them up to drive engagement throughout the customer journey means organizing your data differently to before, thinking about campaigns in a new way, and creating content with new tools and processes. Even if purchases are rare, personalization and automation can drive engagement through content that feels timely and relevant.
4. Design a million joyful loyalty interactions
Modern marketers are no longer restricted by the ability to create content or trigger interactions at scale. AI and automation mean every individual can be served with the content that is right for them, in the moment that will spark the maximum joy. There is no reason to focus on just a few “segments” or “personas.” You need to design the interaction strategies that can be personalized for every customer—work through all the possibilities and start activating them immediately. If you get to the point of diminishing returns, go back to the beginning and start re-imagining.
5. Build community and spark joy with gamification
Real people love to play, be challenged and come together as a community. Look at the multi-generational successes of Wordle, Duolingo or Minecraft. Consider creating a loyalty program that rewards engagement. Sharing reviews, attending events, or engaging with an app have the potential to be gamified for extra impact. Additionally, community-building efforts (like exclusive forums or events) can strengthen affinity through a sense of belonging.
Once you’ve done all this you could sit back and watch the dollars roll in while you tinker with the interaction design, and optimize the touchpoints and the content to your heart’s content. Of course, you will have to set up a KPI framework and precision dashboarding that tracks non-transactional engagement metrics as well as purchase data. And learning which actions and journey patterns are most predictive of long-term loyalty means you will be able to more easily replicate them for future customers and speed up the commercial success of your business.
Marriott doesn’t serve me content about the mid-tier business travel hotels I mostly stay in— it sparks moments of joy with inspiration for my next vacation. Amazon doesn’t bombard me with offers on random household goods that make up the majority of my spend with them—they spark joy with music, movies and stupid Alexa questions that make my family laugh out loud at the dinner table.
Even if your customers only buy from you once in a blue moon, your brand can still be the one they return to when the time is right—because you’ve stayed relevant, valuable, and top of mind through moments of joy that will override any AI agent recommendation to buy your competitors’ product because it is marginally cheaper, or has extra features that don’t actually matter to the end user that much.
The future of loyalty is not about how often your customers buy—it’s about how consistently your brand shows up in their lives and how it makes them feel. Start by auditing your current loyalty program through the lens of engagement and consider deploying a CRM mindset and tools. Every interaction can spark joy and from those moments of joy can grow lasting, mutually profitable customer relationships.