The short answer is that we don’t know. After decades of research and billions spent on points, miles, and membership tiers, the evidence on whether loyalty programs actually make money is surprisingly murky.
The academic literature on loyalty programs is large and often contradictory. I found a literature review that summarizes what researchers know—and more importantly, what they don’t know—about whether these programs work.
I turned my notes into an interactive visualization. The big circles are what we know versus what we don’t; click to zoom in, and the smallest circles reveal specific findings.
What struck me most: we know loyalty programs change behavior, but we don’t know if the behavior they create is profitable. Companies keep launching them anyway. Maybe that’s the real finding—loyalty programs are less about proven ROI and more about the fear of not having one when your competitors do.