Redemption Rate Is the Only Loyalty Metric That Matters

Boards love enrollment numbers. Ten million members sounds like an asset. But a member who never redeems is not an asset — they are an unpriced liability sitting on your balance sheet.

Redemption rate is the honest metric because it measures perceived value. Customers redeem when the reward is worth the effort, at the moment it is offered. Everything else is vanity.

Breakage — the points that expire unused — is not profit. It is deferred disappointment, and disappointed customers churn louder than non-members.

Optimise for redemption and everything else follows: frequency, basket size, lifetime value. Optimise for enrollment and you have built a mailing list.