Artificial Intelligence (AI) is set to significantly transform consumer loyalty programs as companies increase their investments in the technology. Estimates suggest that investments in AI could reach $700 billion by 2026, aimed at enhancing operational efficiency and delivering personalized customer experiences. However, there are concerns that this focus may favor shareholders over customers and employees.
Experts warn that the current emphasis on AI tends to lean towards benefiting companies, potentially sidelining consumers. As businesses implement smarter pricing and marketing strategies, consumers may find themselves at a disadvantage. Yet, this same technology will also become accessible to customers, enabling them to leverage AI to reclaim some control in this evolving landscape.
This forthcoming phase, referred to as “the great rebalancing,” anticipates heightened competition between general AI agents—such as Google Gemini and Microsoft Copilot—and proprietary agents from companies like Qantas, which seek to dictate customer spending behaviors. Subscription-based AI agents specializing in loyalty maximization are also expected to enter the fray, creating a landscape where mastery over customer relationships will be crucial.
Outcome Orchestration
Outcome orchestration, a term describing how AI can manage various actions collectively to enhance customer experiences, is poised to shift competition. Instead of merely reducing friction in customer interactions, businesses are expected to focus on delivering ownership of desired outcomes. This means that consumers and their chosen suppliers will increasingly rely on branded AI agents to automate tasks and decision-making in areas such as health management and travel planning.
For example, a personal AI agent could manage a user’s travel itinerary, adjusting meal orders and scheduling activities to maximize both health goals and loyalty points. This level of control promises a seamless travel experience, akin to the effective package management systems currently employed by delivery services.
In the loyalty sector, blockchain technology is emerging as a game changer, providing transparency and instantaneous validation of transactions. Many loyalty programs are expected to adopt blockchain to streamline reward processes. Notable initiatives already in place include American Express and Singapore Airlines’ KrisPay. Industry futurists predict the possibility of a unified loyalty-points currency supported by blockchain, which could transform existing payment systems.
As companies continue to explore the integration of AI and blockchain into loyalty programs, significant developments are anticipated in the ways consumers engage with and benefit from these programs in the coming years.
