Growth
The future of customer loyalty: from transactions to tribes
Executives think loyalty is rising. Customers disagree. What the evidence actually shows, and why belonging outlasts points.
The gap between what executives think and what customers say
For decades loyalty meant points, discounts and rewards. Spend more, earn more, return again. The evidence now shows a gap between how well leadership teams think that is working and how customers experience it.
PwC surveyed 5,511 consumers and 406 executives for its 2025 Customer Experience Survey, published 29 September 2025 under the title The loyalty illusion. Eighty-nine per cent of executives said customer loyalty to their brand had grown. Forty per cent of consumers agreed. Fifty-two per cent of consumers said they had stopped buying from a brand after a bad experience, and 46 per cent of executives expected their own loyalty programme to be irrelevant within three years.
That gap is the story. Loyalty is being measured from the inside and experienced from the outside, and the two readings have drifted apart.
The honest picture on loyalty programmes
It would be easy to conclude from that survey that loyalty programmes are finished. The evidence does not support the blanket version, and it is worth knowing the counter-argument before you make the claim in a board meeting.
Antavo’s Global Customer Loyalty Report 2026, published 3 February 2026 from 3,000 marketers and 10,000 consumers, reports 92.7 per cent of programme owners seeing a positive return, at an average of 5.3 times. Deloitte’s 2025 Consumer Loyalty Program Survey, published 12 January 2026 from 5,564 US programme members, found 72 per cent saying programmes make them more likely to spend with preferred brands.
Both sets of numbers can be true. Programmes still work on the customers who join and engage. What is weakening is the assumption that a programme creates loyalty in the first place. Bond’s 2025 Loyalty Report, produced with Visa across more than 250,000 consumers and 395 programmes, found only around a third of programmes delivering genuine value to members, with experience and access overtaking points and discounts as the leading driver.
The practical reading: a programme is a mechanism for rewarding loyalty that already exists. It rarely manufactures it.
From membership to meaning
The strongest programmes have shifted from rewards to relationships. Customers who feel they belong to something behave differently from customers collecting points.
Nike connects runners through challenges and shared progress. Emirates Skywards builds recognition and status alongside the miles, which is the mechanic set out in the Emirates Skywards case study. Starbucks turns a routine purchase into a familiar ritual. In each case the transaction is the occasion rather than the point.
The tribe model
People seek belonging because it is part of how they define themselves. The most enduring brands have tribes rather than customer lists. A tribe forms where three things align:
- Shared values. What we believe.
- Shared language. How we talk about it.
- Shared experience. How we live the brand.
Where people buy into your story, they buy into your community, and once they belong they rarely leave. Building that starts with brand positioning that says something specific enough to belong to.
The personalisation paradox
AI has made personalisation more precise and, at the same time, more impersonal. Customers do not want brands to know them so much as to understand them. Data tells you what customers do. Judgement tells you why.
A regional financial brand I worked with introduced AI-driven behavioural segmentation and saw engagement improve. Adding human check-ins at the key milestones improved satisfaction further, and by a wider margin. Automation delivered the efficiency. People delivered the relationship. There is more on where that line sits in brand trust in the AI era.
The community multiplier
The strongest form of loyalty lives between customers rather than between a customer and a brand. Where a community starts connecting with itself, sharing experiences, stories and advice, the brand becomes the place that happens rather than the party doing all the talking.
The IFZA partner network worked on that basis, and so do the best examples elsewhere, from Airbnb hosts to Sephora’s member community. Peer-to-peer engagement sustains retention in a way brand-to-customer messaging does not, because it costs the brand nothing to maintain once it is genuinely useful. Worth being straight about the evidence here: I could find no independent study published since 2023 that puts a reliable commercial value on brand community. The pattern is consistent in practice and the number is not established, so treat it as judgement rather than proof.
What this means in the UAE
Price pressure is doing real damage to habitual loyalty in this market. SAP Emarsys, with Deloitte, surveyed 2,000 UAE consumers and 100 senior UAE marketers for its Consumer Products Engagement Report and found 67 per cent had switched to own-label alternatives on affordability, with 72 per cent of consumer products marketers saying meaningful engagement is getting harder.
In a market where switching is that easy, a discount is a weak defence, because someone will always go lower. What holds is the reason a customer chose you that had nothing to do with price.
Leadership in the loyalty economy
Customer experience is the proof of the promise. Every touchpoint either reinforces trust or erodes it, and loyalty is built across a thousand small moments rather than in the CRM. At IFZA, personalised onboarding, proactive support and recognition-based engagement did more for retention than incentives alone.
The marketing leaders who get this right run ecosystems rather than programmes, joining marketing, technology and service so that loyalty becomes a by-product of the experience. The question shifts from how to retain customers to why they would want to stay.
“Discounts win the next purchase. Belonging wins the next decade.”
Loyalty is earned through consistency rather than bought through incentives. Where customers sense care and reliability, loyalty follows. Turning it into durable growth is part of the growth and performance work I lead.
Five takeaways
- Eighty-nine per cent of executives say loyalty has grown. Forty per cent of consumers agree.
- Programmes still return well for engaged members, and only about a third deliver genuine value.
- A programme rewards loyalty that already exists. It rarely creates it.
- Two thirds of UAE consumers have switched to own-label on price, so discounting is a weak defence.
- Reward participation and belonging alongside purchase.
Sources. Executive and consumer perception gap: PwC 2025 Customer Experience Survey, The loyalty illusion, published 29 September 2025, 5,511 consumers and 406 executives. Programme return: Antavo Global Customer Loyalty Report 2026, published 3 February 2026, and Deloitte 2025 Consumer Loyalty Program Survey, published 12 January 2026, 5,564 programme members. Programme value: Bond Loyalty Report 2025 with Visa, published 4 August 2025, 250,000+ consumers and 395+ programmes. UAE switching: SAP Emarsys with Deloitte, Consumer Products Engagement Report, UAE edition, 2,000 UAE consumers and 100 senior UAE marketers.
Frequently asked questions
Select a question to open the answer.
Is customer loyalty actually declining?
It depends what you measure. PwC found 89 per cent of executives saying loyalty to their brand had grown against 40 per cent of consumers, and 52 per cent of consumers had stopped buying from a brand after a bad experience. Loyalty programme returns, by contrast, remain strong among engaged members. What is weakening is habitual loyalty, not the mechanics of rewarding it.
Do loyalty programmes still work?
For engaged members, yes. Antavo reported 92.7 per cent of programme owners seeing a positive return in February 2026, and Deloitte found 72 per cent of members more likely to spend with preferred brands. Bond’s 2025 report, however, found only around a third of programmes delivering genuine value. A programme rewards loyalty that exists rather than creating it.
What is the tribe model of loyalty?
Loyalty built on identity rather than incentives. A tribe forms where customers share values, a common language and a shared experience of the brand. Where people buy into the story and the community, they rarely leave, which makes that loyalty far more durable than a points balance.
Why does emotional loyalty matter more than transactional loyalty?
Because it is more defensible. A customer who stays for a reason unrelated to price cannot be bought away by a lower one. Be careful with the numbers attached to this claim: several widely quoted figures on emotional loyalty come from agency research with no published method.
How do brand values affect customer loyalty?
They matter most where they are demonstrated rather than stated. Values that show up in how a business behaves, in service, pricing and how it handles mistakes, build loyalty. Values that appear only in campaigns invite scepticism.
What is driving customer switching in the UAE?
Price, mainly. SAP Emarsys, with Deloitte, found 67 per cent of UAE consumers had switched to own-label alternatives on affordability. In a market where comparison takes seconds, discounting is a weak defence because someone will always go lower.
How should a marketing leader build loyalty in 2026?
Join marketing, technology and service so loyalty becomes a by-product of the experience rather than the output of a programme. Reward participation alongside purchase, use AI for prediction while keeping people at the moments that matter, and measure retention against the experience rather than the incentive.
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