Members and offer-only guests: rewarding loyalty or subsidizing deals?
What the answer looks like
Illustrative output on sample data
Illustrative example: how Lexi answers this for a frozen yogurt chain with 28 locations. It compares loyalty membership with each guest's offer use across POS and the app over the past 12 months.
- Members: 96,000
- Offer-only members, 80% or more of visits with an offer: 31,000 (32%)
- Share of member rewards redeemed by offer-only members: 49%
What the data shows
A third of members redeem half of all rewards, and they rarely visit without a deal.
What it means
Rewards stacked on top of offers mean these members pay very little per visit. Full-price members get a smaller share of the program's value.
What to do
Stop rewards from stacking with offers, and add a perk for members who visit at full price.
Want me to show margin per visit for each group?
Why it matters
A loyalty program is meant to reward guests who keep coming back, but it can end up giving extra discounts to guests who only visit for deals. Measuring the overlap shows how much of the program funds bargain hunting and how to point rewards at real loyalty.
Frequently asked questions
How do you know if a loyalty program is subsidizing discounts?
Check how many members mostly visit with an offer, and what share of rewards they redeem. If a large group of offer-only members takes a big share of rewards, the program is adding discounts for deal seekers more than rewarding loyalty.
Should loyalty rewards stack with other offers?
Usually not. Stacking lets guests combine rewards and promotions into very cheap visits, which mostly benefits deal seekers. Keeping them separate protects margin and makes the program more valuable to guests who pay full price.
How can a loyalty program reward full-price guests?
Give extra points or perks for visits without an offer, early access to new items and recognition at higher tiers. Members who pay full price then gain the most, which is where loyalty spending earns its best return.