Your top 5% don't want points

In today's Mailbites, we talk about loyalty, the programs brands build to reward their best customers, and why so many of them reward the wrong thing in the wrong way.

Now, onto today's story.

The Story

A small slice of your customers, often the top five or ten percent, drives a wildly outsized share of your revenue. Keeping them happy is some of the highest-return work you can do. So brands build loyalty programs. And most of those programs quietly miss what loyalty actually is.

The default program is points. Spend a dollar, earn a point, bank enough points, get a discount. There's nothing wrong with it exactly, but notice what it is: a delayed discount with extra steps. It rewards spending with money off, which means your most loyal customers, the ones who'd happily pay full price, are the ones you're training to expect a markdown. You're discounting your best buyers and calling it a perk.

Worse, points reward the transaction and ignore the relationship. Your top customers usually aren't sticking with you for a 5% rebate. They're sticking with you because they like the brand, trust the product, and feel some connection to it. A points balance does nothing for that. It treats your most emotionally invested customers like a punch card.

The loyalty that works tends to reward with access and recognition more than with money:

• Early access. Let your best customers shop the new drop, the limited release, the restock before everyone else. Exclusivity is a reward that costs you nothing and means a lot.
• Recognition. A genuine thank-you from a real person, a handwritten note in the box, being remembered. Customers tell stories about brands that made them feel seen, never about brands that gave them points.
• The unadvertised extra. Free shipping that just happens, an upgrade, a small surprise gift. Unexpected generosity buys more loyalty than any advertised tier.
• Belonging. A community, a name for your members, the sense of being on the inside. People are loyal to things they feel part of.

None of this means scrap points entirely; for some businesses they work fine as a baseline. The point is to ask what your best customers actually value, and it's rarely a rebate. Reward the relationship, not just the receipt, and the people who already love you will love you louder.

Until next week,

Ani