A Maturity Model for Loyalty Programs

Through our work with loyalty programs, large and small, we have observed how loyalty capabilities mature over time as the programs grow. We decided to structure our findings (and complement them with additional research) to develop a maturity model we use as a guardrail when assessing our clients' loyalty programs.

Below is an executive summary of our approach and findings. If you want to receive the whole model, don't hesitate to contact Laurent Guinand directly on LinkedIn so he can send it to you.

The capability areas we used to build our maturity model were the following:

· Program Size and Scope (including number of clients/members, locations, and countries, overall program integration)

· Benefits offered (in particular currencies, points, discounts, experiences, games, tiering systems, exclusivity, and recognition)

· Marketing ( including promotional activities, preferred channels activated, existence of separate branding, segmentation, and content strategy)

· Strategic partnerships (with a focus on value exchange strategy, partner acquisition strategy, account management approach, partner integration, and belonging to loyalty families)

· Operations (buildup of dedicated loyalty teams, reporting lines, program governance, process maturity, focus on data capture and analytics)

· Technology (use of loyalty platforms and apps, Integration with other enterprise systems and platforms, innovation and use of artificial intelligence).

· Customer centricity (voice of customer, customer experience, support, engagement strategy, and overall retention)

· Finance (separate profit and loss statement for the loyalty program, operational and financial KPIs, liability management, and revenue generation).

We cross-analyzed these capabilities along five levels of maturity, progressing as follows:

• Level 1: Basic (Transactional) - Simple transaction-based rewards with minimal infrastructure

• Level 2: Developing (Functional) - Established fundamental loyalty mechanics but operating in silos

• Level 3: Established (Integrated) - Cross-functional integration with consistent execution

• Level 4: Advanced (Strategic) - Strategic business asset with sophisticated capabilities

• Level 5: Leading (Transformational) - Market-differentiating system driving innovation

Here's an executive summary for each of the eight capability areas in the Loyalty Program Maturity Model:

1. Program Size and Scope

As programs mature, they grow from small, single-location operations to massive global networks with millions of members. Size progression reflects not just quantity but integration depth, evolving from standalone initiatives to strategic business platforms that operate seamlessly across markets and touchpoints. Advanced programs maintain consistent experiences despite geographical complexity.

2. Benefits Offered

Benefit sophistication advances from simple transactional rewards to complex ecosystems of value. Mature programs move beyond basic point systems to offer tiered structures, personalized experiences, gamified engagement, and exclusive recognition. The most advanced programs utilize behavioral science to foster emotional connections, rather than merely transactional relationships.

3. Marketing

Marketing capabilities progress from basic promotions through single channels to sophisticated omnichannel strategies with real-time personalization. Program branding evolves from a minimal identity to an iconic status, while segmentation advances from broad demographics to dynamic microsegments. Content strategy matures from generic messaging to AI-driven personalized communications.

4. Partnerships

Partnership approaches evolve from opportunistic relationships to strategic ecosystems. Mature programs develop sophisticated value exchange frameworks, structured acquisition processes, and collaborative innovation models. Advanced programs create seamless partner integration and exclusive relationships, providing unique member value and competitive differentiation.

5. Operations

Operational sophistication grows from part-time responsibility to centers of excellence with specialized teams. Reporting lines advance from middle management to C-suite, while data capabilities progress from basic transaction recording to predictive analytics. Governance and processes mature from informal approaches to comprehensive frameworks with continuous improvement methodologies.

6. Technology

Technology infrastructure evolves from basic tracking systems to next-generation platforms with API-first architecture. Mobile capabilities advance from simple interfaces to state-of-the-art apps with predictive features. Integration progresses from limited connections to seamless ecosystem functionality, while AI capabilities grow from non-existent to driving personalization and innovation at scale.

7. Customer Interactions

Customer engagement matures from transactional exchanges to predictive experiences that anticipate needs. Support capabilities advance from basic inquiry handling to proactive, personalized service models. More sophisticated programs implement comprehensive voice-of-customer systems and predictive retention approaches that create relevant moments throughout the customer journey.

8. Finance

Financial maturity progresses from basic tracking to sophisticated optimization models. KPI frameworks evolve from simple membership metrics to predictive indicators linked to business outcomes. Liability management advances from basic monitoring to real-time optimization, while revenue generation transforms from cost-center approaches to diverse monetization strategies that position the program as a profit center. We found that the progression of KPIs demonstrates how measurement focus shifts from operational efficiency at lower maturity levels to strategic value creation and optimization at higher levels.

An excerpt from our maturity model is provided below.

Loyalty Maturity Model developed by Aramis Advisors

The detailed maturity framework we developed is both an assessment tool and a strategic planning tool. We use it to:

• Evaluate our client’s current maturity level,

• Identify gaps in their approach,

• Plan the next evolution of their capabilities,

• Align KPIs with their desired maturity level.