How to improve customer loyalty when discounts stop working

Discounts are easy to copy, so they rarely keep customers for long. On a recent episode of Let's Talk Loyalty, Elie Carrier-Walker, VP Client Services at Epsilon EMEA, explained how to improve customer loyalty once price stops being enough. She also argued that loyalty works best when the whole business owns it. Elie has spent 14 years at Epsilon and leads loyalty programme delivery for clients across EMEA.

Why don't discounts build customer loyalty?

Elie sees a clear problem with loyalty built on price:

Every brand can offer a deal, so a deal on its own won't make you win.

Emotional loyalty is what keeps people with you when a rival is cheaper. It's why a frequent flyer keeps booking with the airline where they hold status, even when a budget carrier costs less. They've earned perks they don't want to lose.

For Elie, that connection rests on fairness. Loyalty is a value exchange: the customer gives you their business and expects you to hold up your side. Brands that break that promise, for example by quietly cutting a benefit, lose trust quickly.

Transactional rewards still matter, and Elie is clear they can feed long-term loyalty when they sit alongside that emotional value. Loyalty is ultimately your customer retention programme. It's how you invest in the customers who matter most to you and give them a reason to return.

That makes loyalty worth protecting when times are hard. Economic downturns and trade disruption come and go, and Elie sees a well-run programme as one of the things that keeps revenue coming in through them.

How to improve customer loyalty: 8 steps from Epsilon

• Use rewards and emotion together. Points and offers set the baseline. Recognition, status and experiences are harder for a competitor to copy.
• Be relevant when it counts. A free coffee means more to someone who has had to cut it from their daily spend. That only works if you know what your customers are going without.
• Be careful what you give. Taking a benefit away does more damage than never offering it. Before adding a perk or a tier, check you could still fund it if membership doubled.
• Let members feel the benefits early. Programmes that get people to a meaningful status quickly give members a reason to value you from the start.
• Take loyalty beyond the programme. Pricing, communications and customer care all need to reflect it. If the trading team runs deep discounts while the loyalty team works on retention, the two pull against each other.
• Don't overlook B2B customers. B2B loyalty has gained momentum over the last five or six years. It needs its own thinking, because you're rewarding a business rather than a person, and small, medium and large accounts need different treatment. The goal is the same: move the relationship beyond the transaction.
• Plan three to five years ahead, then adapt. Epsilon typically plans loyalty strategy over that timeframe, but treats the plan as something to revise as customer expectations and technology change.
• Treat loyalty data as customer intelligence. What members do tells the wider business where it needs to be relevant, across every channel.

Where do I start with a customer loyalty strategy?

The hardest situation Elie describes is when senior leaders agree a fresh loyalty strategy, then discover their platform can't support it. Teams end up working backwards and cutting the plan to fit the tools.

Getting the order right pays off. In one recent project, Epsilon worked with a large retailer running several brands across multiple markets, each with its own approach to loyalty. The first step was a single loyalty concept that could work across every brand and market, with small local adaptations. From there, the programme moved away from generic offers towards more personal rewards. Elie says the results are now showing, around 12 months in.

Expectations are also moving quickly. Elie points to AI as the obvious shift. Automated segmentation and real-time targeted offers are raising what customers expect from every programme, and loyalty is increasingly something they expect as standard.

Organisational buy-in matters too. Elie notes that loyalty is often treated as "the poor little brother" to other channels. Making it a business strategy needs backing from the top, so that every team's KPIs point the same way.

That makes choosing a loyalty platform one of the first decisions to get right.

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