Marketing

Designing loyalty programs that build trust, not just discounts

It’s tempting to treat loyalty programs like discount engines. But if you want to build real, lasting loyalty, you need to start by building trust. Design for clarity, security, respect and genuine value. Treat your members like partners, not just targets.

Photo: NongAsimo Adobe Stock

September 9, 2025 by Wesley Almeida — Product Strategy Leader / Loyalty Innovation, Independent Consultant

If you ask most marketers what their loyalty program is for, the answer is almost always the same... driving repeat purchases through discounts and points.

But there's a problem. When loyalty programs focus only on transactional rewards, they turn into commodities. Customers learn to game the system for discounts without forming any real connection. Worse, these programs can actually erode trust if they feel opaque, overly aggressive, or leave customers exposed to fraud.

If you want real, lasting loyalty... the kind that keeps customers coming back because they want to, not just because you paid them to... you need to design with trust at the center.

Why trust matters more than discounts

Discounts might get someone in the door. Trust is what keeps them there.

Customers today have endless choices. They're also much more aware of privacy, security, and how brands treat them. When a loyalty program is too pushy with offers, hides the real value behind confusing tiers, or opens the door to fraud, people notice.

Trust isn't built by bribing customers with points. It's earned by showing you understand them, respect them, and will protect them.

Signs your loyalty program might be undermining trust

Here are a few red flags to watch for:

Opaque Value: Customers can't easily see what their points are worth or how to redeem them.
Aggressive Pushes: Endless "flash sales" and marketing spam make them tune out or feel manipulated.
Security Gaps: Weak logins or no fraud checks make account takeovers easier, leading to stolen points and frustrated customers.
Unclear Rules: Fine print that confuses more than it clarifies, leaving customers annoyed instead of loyal.

If any of this sounds familiar, it might be time to step back and rethink how your program works.

Principles for building trust-first loyalty programs

So how do you design a loyalty program that actually builds trust?

Here's what I've learned working on loyalty products in retail...

Prioritize Transparency: Customers should know exactly what they're earning and how to use it. Avoid complicated point conversions or "surprise" exclusions. Simple, clear language matters.
Communicate the Value Clearly: It can't just be about discounts. Talk about exclusive access, personalized rewards, early product releases... anything that feels like a real relationship instead of just a transaction.
Build in Secure, Thoughtful Friction: This one gets overlooked. Yes, redemption should be easy, but not so easy that it attracts fraud. Use biometric verification or one-time codes for big redemptions. Customers will accept an extra step if it keeps their rewards safe.
Educate Your Members: Don't bury the rules in fine print. Make education part of the experience. Celebrate milestones. Show them how to get the most out of the program. An informed customer is an engaged customer.
Be Honest About Data Use: Loyalty programs collect a lot of customer data. Be upfront about how you use it. Give people control over their preferences. Transparency here goes a long way in building confidence.

A real example: Balancing UX and security

I've worked on loyalty apps that were obsessed with removing every barrier to redemption. It seemed like the right move... make it as seamless as possible.

But without any real safeguards, fraudsters were draining thousands of dollars worth of points.

We added biometric login and simple confirmation steps for high-value transactions. Sure, redemption took a few seconds longer, but fraud dropped dramatically. More importantly, customers felt safer knowing their rewards were protected.

Sometimes the best way to build trust is to slow things down just enough so people feel secure.

The payoff for marketers

Trust-first loyalty programs don't just cut fraud or reduce complaints. They deliver on the things marketers really care about:

Higher retention rates.
Increased customer lifetime value.
Better word-of-mouth.
Lower support costs from fewer disputes.

When customers believe you have their best interests at heart, they engage more, spend more, and stick around longer.

Final thoughts

It's tempting to treat loyalty programs like discount engines. But if you want to build real, lasting loyalty, you need to start by building trust.

Design for clarity, security, respect, and genuine value. Treat your members like partners, not just targets.

Because at the end of the day, the strongest loyalty isn't bought with points... it's earned through trust.

Loyalty Programs Marketing

About Wesley Almeida

Wesley Almeida is a seasoned product leader with two decades of experience building digital retail solutions. He specializes in loyalty program design, fraud prevention strategies, and creating customer experiences that deliver trust and long-term value. Wesley is passionate about helping brands move beyond transactional rewards to build genuine, lasting loyalty.

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