Hospitality venues have embraced loyalty programs, hoping to drive repeat visits and higher spend. But for many, results have been underwhelming. Instead of boosting revenue, these programs quietly erode margins and miss opportunities to influence customer behaviour.

The reason? Most loyalty systems are static.

They offer the same reward to every customer, every time, regardless of who they are, when they visit, or how they spend. These one-size-fits-all programs can't adapt to your business needs or guide customer behaviour in meaningful ways.

If your loyalty setup feels more like a cost than a growth lever, the issue isn't loyalty—it’s the system behind it.

The Static Loyalty Trap

Most loyalty systems follow the same template: customers earn points or stamps, then redeem them later. It sounds simple, but it leaves major gaps:

1. Points don't feel valuable
Points-based systems create unnecessary mental effort. Customers rarely know what their points are worth. “How many points get me a coffee?” “What does 250 points buy?” They have no intuitive sense of what those points are actually worth—creating a disconnect that dampens enthusiasm for your program.

When value isn’t clear, redemption drops and engagement fades.

2. Everyone gets the same offer
Most loyalty platforms offer rigid reward structures that treat all customers the same way. Your regular who comes for coffee every morning gets the same generic offer as the family that visits once a month for dinner. This one-size-fits-all approach fails to drive specific behaviours that matter to your business.

3. It's built on hope, not strategy
Traditional programs operate on hope: you give rewards and hope customers return. But hope isn't a business strategy. Without mechanisms to guarantee future visits, you're essentially discounting today's sales while crossing your fingers about tomorrow's revenue.

The Hidden Costs of “Simple” Systems

Punch cards and physical rewards

While punch cards seem appealingly simple, they come with hidden costs that compound over time:

• Zero customer data capture: You learn nothing about purchasing patterns, preferences, or visit frequency

• Manual administration burden: Staff time spent managing, replacing, and tracking physical cards

• No targeting capability: Every customer gets identical treatment regardless of value or behaviour

• Easy to lose or forget: Customers regularly leave cards at home, reducing program effectiveness

Basic digital platforms
Many venues graduate from punch cards to digital loyalty platforms, only to discover new limitations:

• App fatigue: Customers resist downloading yet another venue app

• Complex signup processes: Friction at enrollment reduces participation rates

• Surface-level insights: Basic reporting that doesn't drive actionable business decisions

• Inflexible campaign options: Limited ability to create targeted, behaviour-driven incentives

What Programmable Loyalty Actually Looks Like

Programmable loyalty represents a fundamental shift from reactive discounting to proactively driving revenue. Instead of static rewards, you set rules based on the behaviours you want to drive.

Triggers based on customer behaviour:

Rather than static point accumulation, programmable systems can respond to specific customer actions:

• Time-based incentives: Double rewards during slow periods to drive off-peak traffic

• Spend-based bonuses: Extra rewards on orders over $X to increase average transaction value

• Channel-specific offers: Incentivise online ordering, catering, delivery or table service adoption as per your business goals

• Frequency rewards: Recognise and reward your most valuable regular customers

Dynamic Campaign Creation

Programmable platforms allow you to create sophisticated campaigns that adapt to business needs:

• Convert lunch customers into dinner guests with targeted evening offers

• Drive weekend traffic with Friday incentives

• Increase basket size with complementary product suggestions

• Re-engage lapsed customers with personalised win-back campaigns

Why Currency Beats Points: The Psychology of Value

The most effective programmable loyalty systems use venue-branded currency instead of confusing points. When customers receive "$5 in Charlie Dollars" they immediately understand the value—no mental math required. This clarity drives higher engagement and redemption rates.

Banking Future Visits

Here's where programmable loyalty becomes truly strategic: the ability to bank future customer intent through pre-purchased currency.

Instead of hoping customers return, you can offer them the opportunity to purchase $100 in venue currency for $80. This approach:

• Improves cash flow: You receive payment today for future visits. This not only reduces cash flow constraints but also improves cash on hand to fund growth and expansion. 

• Guarantees return visits: Customers have committed incentives to return and redeem

• Increases customer lifetime value: Pre-purchased currency typically drives additional spending

This isn't discounting—it's strategic revenue advancement that strengthens both cash flow and customer commitment.

Integration is the Multiplier

The most successful programmable loyalty systems don't exist in isolation. They integrate seamlessly with:

• Point of sale systems: Automatic earning and redemption without staff intervention

• Payment processing: Card-linked loyalty that works with any payment method

• Ordering channels: Consistent experience whether customers order in-venue, online, or via kiosk

• Customer data platforms: Rich insights that inform marketing and operational decisions

Measuring What Matters

Traditional loyalty programs often measure vanity metrics like total members, points issued, basic redemption rates. Programmable loyalty focuses on business impact:

• Average transaction value increase: Are customers spending more per visit?

• Visit frequency improvement: Are customers returning more often?

• Channel adoption rates: Are customers using your preferred ordering methods?

• Behavioural campaign effectiveness: Which specific incentives drive desired actions?

What Success Looks Like

Venues that transition from static to programmable loyalty typically see:

• Up to 19% increase in average transaction value

• Improved customer visit frequency

• Better cash flow through future intent banking

• Actionable customer insights that inform business decisions

• Reduced operational complexity through integrated systems

Ask Yourself

The fundamental question isn't whether to offer loyalty—it's whether your loyalty program actively drives the specific customer behaviours that grow your business.

Ask yourself:

• Can you incentivise lunch customers to try dinner?

• Can you drive traffic during traditionally slow periods?

• Do you know which customers are at risk of churning?

• Can you increase average spend through targeted offers?

• Are you banking future customer intent or just hoping they return?

If you answered "no" to most of these questions, you might be running a loyalty program that's more cost centre than revenue driver.

The Bottom Line

Loyalty isn’t the problem. Static loyalty is.

Today’s venues need loyalty tools that adapt to their needs, reward real behaviour, and work across channels without extra effort.

Programmable loyalty is how that happens. It doesn’t just thank customers. It shapes revenue.

Ready to stop handing out points and start driving results?
It’s time to upgrade from set-and-forget.