Loyalty Is Becoming a Commodity

The Loyalty Number Everyone Likes to Quote

How many loyalty programmes does the average consumer belong to?

It is an impressive number.

And increasingly, it is the wrong number to obsess over.

New 2026 research from American Express found that the average British consumer belongs to 12 loyalty schemes, while Mintel reports that 55% of UK consumers belong to at least four schemes.

On the surface, that looks like a loyalty success story.

Consumers are signing up. They are carrying memberships in their wallets. Brands are building larger addressable audiences.

But there is another number that tells a very different story.

Mintel found that 58% of consumers had actively used three or fewer loyalty schemes in the previous six months.

That is the gap we should be paying attention to.

Because the loyalty industry has spent years optimising for membership.

The next phase needs to optimise for preference, behaviour and share of wallet.

Membership Is Not Loyalty

Signing up for a loyalty programme is easy.

A customer sees a sign-up prompt at checkout. They download an app. They enter an email address. They tap a digital card into their wallet. They receive an introductory offer.

Congratulations.

You have a member.

But you have not necessarily created loyalty.

Membership is a permission structure. It gives a brand the ability to recognise the customer, communicate with them and potentially reward them.

Loyalty is what happens next.

It is the customer choosing you when alternatives are available.

It is the habit that survives a competitor's discount.

It is the decision to consolidate more of their spending with you.

It is the feeling that the relationship has value on both sides.

Those are very different things.

A database full of members can still contain very little genuine loyalty.

The Wallet Is Getting Crowded

The consumer is not short of loyalty options.

Supermarkets. Coffee shops. Airlines. Hotels. Fashion retailers. Beauty brands. Credit cards. Cashback platforms. Delivery services. Local businesses.

And many of them now offer broadly similar mechanics:

Earn something when you spend.

Unlock something when you reach a threshold.

Receive a discount.

Collect points.

Get a birthday reward.

That has created a strange paradox.

Consumers have more loyalty memberships than ever, but each individual programme has to fight harder to become part of the customer's routine.

This is not just a UK phenomenon. Loyalty programmes are increasingly competing for customer attention across categories and markets.

The implication is important.

The competitive set for your loyalty programme is no longer simply the other programmes in your category.

It is every programme competing for space in the customer's attention, wallet and digital wallet.

The Rise of the 'Loyalty Portfolio'

Consumers are becoming portfolio managers.

They do not necessarily have one favourite programme.

They have a collection of programmes that perform different jobs.

One might be their supermarket programme because it saves money on the weekly shop.

Another might be a travel programme because the rewards are valuable for a holiday.

A third might be a coffee programme because the reward is immediate and effortless.

A fourth might simply be useful because it gives them access to member pricing.

This is rational behaviour.

Consumers are not asking:

"Which brand am I loyal to?"

They are increasingly asking:

"Which membership gives me the best value for this transaction?"

That is a subtle but fundamental shift.

It means loyalty programmes are increasingly being evaluated at the moment of choice, not simply at the point of enrolment.

Discounts Can Create Loyalty Without Creating Preference

There is another uncomfortable consequence of a crowded loyalty market.

When programmes compete primarily on immediate financial value, they can train customers to shop the reward rather than the relationship.

This does not mean discounts are bad.

They are often incredibly effective at changing behaviour.

The question is what behaviour they are changing.

If a member buys from you because you are £5 cheaper today, you have influenced today's transaction.

If they choose you because they believe your brand understands them better, gives them recognition, removes friction and consistently delivers better value, you are influencing preference.

Those are not the same thing.

A discount can win a transaction without winning the customer.

The Metric We Should Be Talking About More

Programme membership is easy to report.

It makes a good headline.

"We added one million members."

"Our database grew 20%."

"Three million customers have joined."

But membership growth can hide a deteriorating relationship.

A better question is:

What proportion of our members actively choose us — and is that proportion increasing?

That shifts the conversation towards metrics that are much closer to commercial behaviour:

• Active member rate
• Share of wallet
• Incremental frequency
• Incremental spend
• Repeat purchase rate
• Reward redemption
• Churn among previously active members
• Cross-category or cross-product adoption
• Retention versus comparable non-members

The point is not to abandon membership as a KPI.

It is to stop treating membership as the outcome.

What Actually Makes a Programme Worth Keeping?

If the average consumer already has a crowded portfolio of loyalty memberships, another programme cannot simply ask them to add one more.

It has to earn its place.

That usually comes down to four things.

1. The value is obvious

Customers should not need to understand your economics to understand the benefit.

If the reward takes months to earn, has complicated conditions and is difficult to redeem, it is unlikely to become part of everyday behaviour.

The value needs to be immediate enough to understand and meaningful enough to remember.

2. The programme saves effort

The best loyalty experiences do not create another job for the customer.

They recognise them automatically.

They surface relevant benefits.

They apply rewards at the right moment.

They reduce friction rather than adding another layer of it.

3. The value is differentiated

If every competitor offers points and 10% off, points and 10% off are not a strategy.

Brands need to identify what they can offer that customers cannot easily get elsewhere.

That might be access.

Recognition.

Convenience.

Experiences.

Status.

Relevance.

Or genuinely better economics.

4. It gives customers a reason to come back

The strongest programmes create a reason to return beyond the reward itself.

That might be progress towards a meaningful goal.

It might be discovery.

It might be personalised relevance.

It might be a feeling of belonging.

The reward gets the customer through the door. The experience gives them a reason to stay.

The New Loyalty Question

The old question was:

How do we get more customers into our loyalty programme?

The better question is:

Why should a customer choose our programme over the other ten sitting in their wallet?

That is a much harder question.

It forces loyalty teams to think beyond acquisition and enrolment.

It forces them to understand the customer's wider portfolio of relationships.

It forces a conversation about genuine differentiation rather than another layer of mechanics.

And it changes the role of loyalty.

Because when almost everyone has a programme, having a programme is no longer the competitive advantage.

The advantage is becoming the programme the customer actually uses.

The TLP Take

Loyalty is not becoming less important.

It is becoming harder to fake.

The era of celebrating membership numbers without understanding member behaviour is coming to an end.

Consumers have too many choices, too many memberships and too many ways to compare value.

The programmes that win will not necessarily be the ones with the biggest databases or the most elaborate reward structures.

They will be the ones that become genuinely useful.

Useful enough to open.

Useful enough to remember.

Useful enough to influence a decision.

Useful enough to earn a larger share of the customer's wallet.

The future of loyalty is not about collecting more members. It is about becoming harder to replace.

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