Mechanics like ‘spend X, get Y’ can be effective when used with intent. The problem is, when they’re applied too broadly, they end up rewarding behaviour that would’ve happened anyway.

The ‘spend X, get Y’ mechanic can drive stretch, repeat purchases or new behaviours. But if it’s not tailored to the customer, it simply hands out margin without any return.

Stamp cards are simple, satisfying and popular with customers. But even these can reward existing habits rather than create new value.

Three common loyalty mechanics are draining value:

• Blanket ‘spend X, get Y’ offers.
• Discounts on products people already buy.
• Collectors aimed at customers who don’t need nudging.

Used strategically, auto reward helps protect long-term value. Rewarding your top 10% of customers can prevent churn, but only if the impact is measured and proven.

Loyal high spenders and disloyal deal chasers should not be treated the same. Auto reward the first group. Stretch or convert the second.

Before diving into data or tools, define the goal. Are you trying to retain, stretch, drive product discovery or push short-term sales?

There isn’t one ‘bad’ loyalty mechanic. Spend stretch, discounts and collectors are all valid. Success depends on how well they are targeted, tailored and tracked.

Without strong leadership, aligned teams and scalable tech, even the best loyalty strategy will struggle to perform.

Most importantly, giving away money can be a good thing. But only if there’s a clear strategy behind it and measurement to show what works and what doesn’t.