Engage People, the only loyalty network that enables program members to pay with points directly at checkout, commissioned a new survey from The Wise Marketer as part of its ongoing research series on consumer loyalty trends titled “Cashing Out: What Consumers Expect from Loyalty Programs.” The report found that 90% of consumers are open to switching brands, underscoring the growing importance of financial-based rewards—such as the ability to Pay with Points (PwP)—in driving consumer retention and engagement.
The survey, which was conducted among 1,001 U.S.-based consumers in November 2024, found that despite widespread participation in loyalty programs, only 12% of consumers identify as truly brand loyal, emphasizing that competitive incentives drive retention more than brand attachment. The top three factors influencing brand switching include:
- Price (69%) – The most significant driver behind consumer switching behavior
- Loyalty program benefits (53%) – A strong incentive for staying engaged
- Special promotions and discounts (51%) – A key motivator in purchasing decisions
“It’s not that surprising to see that price is the leading driver of switching behavior from one brand to another,” said Aaron Dauphinee, CMO of The Wise Marketer Group. “More than half of survey respondents indicated that loyalty program benefits can be an inducement, slightly bettering special promotions and discounts. When you ask consumers what benefits they prefer, cash back or credit has always led. We see that in this report, but the findings suggest that the combination of ‘what’ consumers can redeem for, such as merchandise at the retailer, and ‘how’ they can redeem, such as paying with points, are significant.”
Loyalty program disengagement remains a major challenge
While many consumers enroll in multiple loyalty programs, 47% have stopped participating in at least one program, revealing significant disengagement. The two primary reasons for this trend are:
- Difficulty in earning rewards (51%) – Consumers are frustrated by slow or complex point accumulation
- Lack of relevant or appealing rewards (41%) – Benefits fail to align with consumer needs
One of the most effective ways to combat disengagement and boost member engagement is by offering the ability to exchange points for cash-like value at checkout. The study found that 78% of consumers would engage more with a loyalty program that provides ‘Pay with Points’ as an option, underscoring the demand for flexible redemption solutions that make rewards immediate, meaningful, and easy to use.
Financial rewards dominate consumer preferences
When it comes to loyalty program engagement, consumers overwhelmingly favor tangible financial benefits over “softer” experiential perks. The top engagement drivers include:
- Cashback or credit (86%) – The most preferred redemption option
- Price-oriented incentives (65%) – Discounts, promotions, and rebates
- Loyalty-driven incentives (61%) – Points redeemable for goods and services
Consumers also favor redemption options that directly reduce their costs. The research found that 64% of consumers prefer the ability to Pay with Points at checkout, further underscoring the demand for seamless, flexible redemption options that provide immediate financial relief.
“Loyalty today isn’t a given – it’s something brands have to continuously earn by delivering tangible and immediate value,” said Len Covello, CTO of Engage People. “Consumers are actively seeking rewards programs that make it easy to redeem points in ways that benefit them. When those expectations aren’t met, they move on. For example, providing the ability to pay with points helps brands stay competitive by providing the flexibility and financial relief consumers want, ensuring engagement isn’t just transactional but long-term.”
This year’s study highlights a continued shift toward financial-based rewards and cost-saving incentives in consumer loyalty preferences. In 2022, The Wise Marketer found that 78% of consumers cited earning rewards as their top reason for joining a loyalty program—a number that climbed to 87% in 2024.
