Loyalty programs and service awards don’t produce their intended outcomes

The changes announced recently to the Air Miles program got me thinking. What’s in my wallet? The answer: A pocket full of loyalty.

My wallet is filled with cards for many different loyalty programs. I am a member of three coffee chain’s programs. All my credit cards provide opportunities to earn points.

Every grocery store I enter provides points and I have signed up for all of them. I am enrolled in about half a dozen hotel programs. And there are points from airlines, bookstores and the phone company.

This abundance of reward cards suggests that these programs are as ineffective at building loyalty as are “recognition” programs that reward employees for their service every five years.

Neither works as intended. Programs create neither customer nor employee loyalty.

Opportunities to earn points don’t influence my buying decisions. There are other factors. I will shop, stay or fly with whichever store, hotel or airline offers the best price, is most convenient, provides the best customer service, or is a combination of all three.

There is only one business to which I am truly loyal—my local Second Cup coffee shop—but this has nothing to do with the chain’s loyalty program. 

I am there frequently. It’s where I go to write. The article you are currently reading was conceived, written and revised there. 

I collect points with every cup of tea I purchase. At last count, I had more than 5,000 points in their loyalty program, good for 10 drinks.

Why so many? Because I don’t go this Second Cup for the points. I am a loyal customer because of intangible benefits. I like the atmosphere, the people who work there and the energy of the strangers who patronize the coffee shop.

I never use points to buy drinks at my Second Cup because I am invested in their survival. I know that any time I redeem points it comes right off their bottom line. The franchise does not reimburse franchisees for the “free” drinks they serve.

I save the points until I am passing a corporate store.

I suspect that few staff members are loyal to their employers because of the promise of an invitation to a celebration of service in five year’s time. I never met anyone who said, “I stayed because my employer did such a terrific job of celebrating my five years of service,” but many initiated a job search because they felt their boss didn’t show enough appreciation for what they did. 

Where people feel valued and appreciated is where people want to stay.

Organizations need to offer more than the promise of a celebration of service every five year to improve retention. Of course they need to compensate staff fairly, but more than money is needed. The leadership team must work to create a work environment where staff members want to be, where they believe they belong. 

Meaningful staff recognition conveys the message that staff members are valued as individuals and appreciated for what they do. Where people feel valued and appreciated is where people want to stay.


Looking for advice on creating a workplace where people want to be? Schedule a 15-minute telephone or Zoom conversation with me to discuss your questions about staff recognition. There’s no cost to you. My reward is the opportunity to talk with people who share my passion for staff recognition.

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