Capillary And Forrester Execs Foreshadow Future Of Loyalty Marketing

Forbes

2 days ago

Loyalty marketing is going through a transformation in an era where consumer attention is scarce and brand trust is everything. Jim Sturm, President, North America at Capillary Technologies, believes we're standing at the threshold of a new kind of relationship between brands and consumers—one defined less by transactional rewards and more by emotional engagement and data-driven personalization.
According to Forrester's 2024 retail survey, 77% of U.S. online adults agree that they like to engage with loyalty programs even when they're not purchasing. Modern loyalty programs capitalize on this golden opportunity to engage customers beyond the transaction with a diversified set of interactions that are personalized to the member's interests and complement the program's core financial benefits.
'Consumer interest in experiences and live events is rising with trusted brands having permission to help consumers experience more by leveraging loyalty rewards to take in a concert, go see their favorite college or pro sports team and using some of their accrued loyalty perks to pay for that experience,' noted Adam Rossbach, President of TFL.
Thai rapper and singer Lisa, from South Korean group Blackpink, performs during the Global Citizen ... More Festival at Central Park in New York City on September 28, 2024. (Photo by Charly TRIBALLEAU / AFP) (Photo by CHARLY TRIBALLEAU/AFP via Getty Images)
Capillary Technologies, which recently acquired Kognitiv, continues its strategic ascent toward becoming 'the global leader in consumer experience, loyalty technology and consulting,' says Sturm. 'Our plan was to grow through acquisitions and direct sales. This is our fourth acquisition, and we couldn't be more proud.'
The evolution of loyalty programs is stark when framed through Sturm's lens. 'The loyalty industry grew up with things like S&H Green Stamps—my mom would shop, come home with stamps, and I'd paste them in a book. Fill it up, and you'd get a free item,' he recalls with a smile. 'Then airlines and hotels introduced points and tiers. But today, loyalty is about much more than that. It's experiential.'
He cites Amazon Prime as a standout example. 'It's a form of a loyalty program. You subscribe not because of points, but because you love the benefits and the experience.'
Experiential loyalty, according to Sturm, has become the hallmark of successful programs. 'It's not about 'buy 9, get the 10th free' anymore. It's about whether a brand knows you—your preferences, your behaviors—and can engage you in a way that feels uniquely relevant.'
Modern loyalty programs offer a unique opportunity to create personalized and exclusive brand experiences that motivate members to move up the status ladder. In Forrester's most recent Consumer Benchmark Survey, 54% of U.S. online adults who belong to loyalty programs agree that getting special treatment is important to them; 63% say the same about getting special offers that are not available to other customers.
How do you replicate the intimacy of the neighborhood butcher—who knew your mom's favorite cut of meat—at enterprise scale? Sturm has a clear answer: 'Knowledge today comes from data.'
Capillary's platform uses artificial intelligence and machine learning to personalize engagement. 'If I know Jeff loves the color blue and shops certain designer brands, I can tailor that experience. That's emotional loyalty—when you touch the heart, not just the wallet.'
This isn't just theory. Sturm underscores how emotional loyalty leads to more spending and deeper brand love. 'You can incentivize a purchase with a discount, but that's not loyalty—that's a transaction. Real loyalty is when the consumer feels a connection so strong, they keep coming back.'
Trust is the currency of modern loyalty programs, especially with younger consumers. 'Younger generations are more willing to share information,' says Sturm. 'But only if they believe the brand will use it to enhance their experience.'
He echoes findings from my own Gen Z research: 'If I tell you my preferences, and you use that to deliver real value—yes, I'll share. But if I see abuse or irrelevance, I'll shut it down.'
Sturm distills decades of experience into four rules for CMOs and strategists building loyalty ecosystems:
Live events offer brands a chance to deliver unforgettable experiences—'the reward side of loyalty,' as Sturm puts it. 'Major credit cards and airlines now offer once-in-a-lifetime event access. It works when it's personalized and relevant.'
That's where partnerships like those being explored with Tickets For Less come in. 'Earn-and-burn strategies that include live events? That's different. And it matters,' says Sturm. 'The right events for the right persona can create magic.'
As AI reshapes marketing, Sturm remains clear-eyed. 'It's not about the tech, it's about trust. And it's about ensuring your AI is accurate, your data is ethical, and your brand is human at scale.'
In closing, Sturm reflects, 'I've been in this business a long time, but I stay because of the impact we can make—helping consumers have better experiences and helping brands build lasting relationships.'
That, after all, is the heart of loyalty.