Poll time! It's So Many Point's first anniversary in August, so what should I pull back the curtain on?
In this Issue:
👉🏻The Big Point: Loyalty as Proof of Life
🔎 Points Worth Reading: The Bond Report is out
⚡Quick Points: News on Marriott, Waymo, Chase, and more
👉 THE BIG POINT
Loyalty as Proof of Life
A Pattern Worth Pointing Out
In putting together this newsletter, I’ve noticed a pattern: struggling brands waving the “loyalty looks healthy” flag to counter declining sales. The P&L isn’t pretty, the news is mostly bad, but the shining star is loyalty. So the message to investors becomes: no need to worry, the signs of a turnaround are right here. Or: yes, the brand is in decline, but a program revamp will save the day and anchor the comeback.
Call it Loyalty as Proof of Life. A few examples:
Cracker Barrel’s recent Q3 ’26 earnings call admitted the brand still isn’t out of the woods from its disastrous rebrand (the one that got put on hold) — but the CEO pivoted to program growth: 12 million members, with member sales at 40% of total.
Krispy Kreme bragged on its Q1 ’26 call that 17 million members were “feverishly engaged with the brand”, while the company posted a $22M loss.
Pizza Hut has been closing hundreds of restaurants amid declining sales, but decided this past April was a great time to relaunch Hut Rewards — a bizarre announcement billing it as a “next-generation membership” that was, in fact, a free program much like the old one.
In the UK, ASOS posted a 13% revenue decline in 1H ’25 and announced its new program, ASOS.WORLD, as a big part of the turnaround effort.
And back in 2024, now-bankrupt Spirit Airlines’ CEO offered this gem on the four things the company was focused on: “…refinancing our debt, improving our overall liquidity position, deploying our new product, and growing our loyalty programs.” Yup. Loyalty, right alongside debt refinancing.
Why This Is a Problem
The trouble is two-fold.
First, the metrics. Total members and percentage of transactions are cited as proof that a program is working. That’s not engagement. All a big enrollment number signifies is that you’ve successfully figured out how to sign a whole bunch of people up for something free.
Second, the timing. Launching or relaunching a program while a brand is suffering is common, but I’d argue it’s the worst possible moment to do it. Loyalty is meant to reward your best customers and elevate a brand. It’s not meant to be the brand. Pushing more people into a program while your product is struggling is throwing good effort after bad. Fix the brand basics first.
Two Brands Who Explained it Differently
🌯 Chipotle: Transactions declined for consecutive quarters, but the company focused on actual engagement, such as trips and average check, between loyalty and non-loyalty members, noting that loyalty members were recovering faster. More importantly, they spotted that in-store buyers were far less engaged with the program, and that was exactly where their biggest sales declines were.
Why it was different: They focused on behavior, not sign-ups, and used loyalty to figure out where to focus. They did make program changes (all in the members’ favor), but only recently, after comps flattened.
☕ Starbucks: Comps had been in decline for years when Brian Niccol arrived. His Back to Starbucks plan wasn’t about Starbucks Rewards at all. It was about getting the brand back to its roots and what made it great. At times he sounded almost anti-rewards, saying the program had gotten too heavy on discounting and become cold and transactional. They did eventually relaunch it, and plenty of those changes drew backlash. But comps started growing regardless.
Why it was different: Where Chipotle leaned into loyalty as an honest read on behavior, Starbucks did the opposite. It barely leaned on the program at all. The turnaround story was the product and the brand experience; rewards were a footnote, not the headline. Sometimes the most honest thing a brand can do is admit loyalty isn’t the lever.
Loyalty helps brands do better when things are going well. It doesn’t mask things going badly.
How to Stay Out of the Proof-of-Life Trap
A few tips:
Stop counting heads. Total sign-ups and total members are vanity. Focus on frequency and average sales per member instead.
Incremental, not attributed. “% of sales from members” is not the same as sales generated by the program.
Is loyalty moving with the business or against it? If loyalty looks like it’s winning while the brand is losing, that’s a flag. Both should move in the same direction — loyalty just dropping less on the way down, and gaining more on the way up.
Don’t make big program changes while the brand is suffering. Wait until things stabilize and customers are rediscovering what made your brand great in the first place (and the program isn’t that).
Be honest with leadership if they want to plant loyalty as the flag on the hill that says the brand is back. Refocusing them on the right metrics is your job.
I’m hoping that one day brands stop reaching for these vanity loyalty metrics, because a heartbeat doesn’t mean you’re healthy. Let’s move the conversation toward engagement, and stop treating loyalty as the cure-all for bigger brand problems.
🔎 POINTS WORTH READING
⚡ QUICK POINTS
✈️ TRAVEL & TRANSPORTATION
Marriott’s hotel owners are raging that they aren’t getting a cut of the Cobrand card windfall that Marriott corporate frequently talks about. I expect hotel owners of Hilton, Wyndham, and Hyatt to start complaining in 3…2…
In good news for Marriott members, they launched a beta version of Ask Bonvoy (cute name), an AI-powered search experience. Unfortunately, I was not one of the lucky members in the beta.
Autonomous ride-hailing company Waymo launched a $29.99/mo membership program offering 10% off and a few other small benefits. This is way too high for little benefit. In comparison, UberOne is $10/month for 6% off, plus a $0 delivery fee and more.
Sandals ditched their Select Rewards program for ‘Island Insiders Club’, focused more on experience-based choices. They did keep the popular ‘complimentary 7-night stay after 70 paid nights’ benefit and all 7 🤯 tiers and members kept their status in the rollover 👏.
Rumor has it Hyatt might be making more program changes.
Across the pond, budget airline easyJet said it would launch a loyalty program and it will “not be elitist in its nature”, whatever that means.
🍴RESTAURANTS
Ice cream brand Salt & Straw launched a rewards program, earning 10 “spoons” for every dollar. I don’t think ice cream shops have the frequency necessary for loyalty programs.
🛒RETAIL
MyLowe’s Rewards now has a Live Nation partnership to tap into discounted tickets, among other benefits.
Verizon launched Verizon Shine (apparently a play on ‘rise and shine’ I didn’t get at first) with weekly Monday freebie and discount drops, sweepstakes opportunities, and 3% of your bill provided in ‘Verizon Dollars’ that you can put toward Verizon or partner brands for discounts. Big program for their 90M customers.
💳 FINANCIAL
Chase added a whole bunch of new benefits to the Sapphire Preferred card including 3x points on gas and EV charging. For a (not changed) $95 fee the benefits are great, but buried in the PR is is the devaluation of the Hyatt transfer.
🙃 RANDOM
Dynamic pricing drama (again!). The Washington Post is being sued by longtime subscribers who claim they end up paying the most due to WaPo knowing more about them. And California has a bill proposed to ban dynamic pricing but some worry it could impact personalized loyalty. My prediction is that dynamic pricing lawsuits will eventually reach the Supreme Court.
What might help drive sales and customer loyalty? Being honest when you have low inventory and might be out of stock soon.