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What is the difference between a transaction and actual loyalty? Between a massive airline miles program and the barbershop down the street? The answer is the reason most companies spend millions on retention without ever building a single real connection. Most loyalty programs don't build loyalty. They build a transactional dependency. The customer ends up loyal to the points, not to your brand. So the moment your competitor offers more points, they're gone. Hi, I'm Rob. I am the host and the founder of Professor Game, and I head engagement strategy in Europe for the Octasis Group, where we help companies turn motivation into retention. And in this episode, I'll show you why the most powerful loyalty program has almost nothing to do with points. We'll take apart the machinery behind airline miles, contrast it with a local service that gets loyalty right and and leave you a single diagnostic test you can run on your own product right away. And if you enjoy the kind of thing that we discuss in this episode, where we break through real examples in the corporate world of the use of the core drives and how to do it right and wrong, you'll definitely enjoy our free guide, Core Drives in the Wild. It's right below on the link in the description. Now, let's get into it. Look at the typical frequent flyer program. It runs almost entirely on what we call black hat motivation. The drives that get you moving immediately but don't feel good over time. And don't get me wrong, that can work under situations and it can be part of a very good mix. But let's get started. First, we have the engine running on CoreDrive for ownership and possession. Your accumulated miles feel like this kind of asset, something you've built, something you don't want to waste because it now belongs to you. You feel that ownership, that seems to work out pretty well. Then they start layering things like Core Drive 6 scarcity and impatience. The tier status is exclusive and just, you know, almost out of reach. So you make this stretch, you maybe do another flight, or you switch from a more convenient flight to this one because you want to reach that status, for example. The problem is that then the trap snaps shut with Core Drive 8 loss and avoidance. You stop flying and your miles expire. Your status drops. You're not flying towards something you want anymore. You're flying to avoid losing what you've already achieved. This tack can be brutally effective in the short term and at the same time, be quietly corrosive for the long run. And the mechanism that does the damage in this case is the overjustification effect. Picture a flyer who genuinely Enjoys, likes a certain airline. They've had, you know, good crew, smooth experiences. They're overall generally happy. Then this thing called the miles program takes over the decision. Watch what happens when they're at a booking. There's a better flight, perhaps on another airline, it's a shorter trip, it's a nicer time of the day, maybe even a better price. And they book the worst one anyway because the worst one earns miles on their airline. Let me say that again. They book the worst flight because it earns miles on their airline. They are now choosing the inferior experience to protect a points balance. That's the moment. That is the exact moment when the relationship completely died and got replaced by a calculation. I fly with them because I like the experience and this airline is essentially better. For whatever reason, I think that they are better became. Now I fly with them for the miles. And there is, let's call it a humongous problem. When you turn the relationship into a calculation, it is trivially beatable. A competitor who has a slightly better offer doesn't just win over one trip. They reveal that there was never a loyalty to begin with. The person was never loyal. You weren't ever loyal. You were doing math. And since points are so easy to beat, what does loyalty look like when there are no points at all? I've been going to my barber for 10 years. When I moved, I tried, I moved, I lived. It was literally like 2 minute walk where I used to live. I tried. After that I moved further away and tried two or three other places that were genuinely closer to me. It was objectively a lot more convenient to go somewhere else. I ended up back with her every single day. Time. She has no app, no points, no tiers, no expiring rewards by every metric that a traditional loyalty program is built to optimize. She would have completely lost me. The competition was closer to my door. Some of them were cheaper. What was actually holding that relationship together? Let's enter Core Drive 5, Social Influence and relatedness. I'm not a transaction to her, I'm a regular. She's nice to be around and I genuinely enjoy my time at time. The the chair. That sense of belonging is not something a competitor can copy by being a few streets closer. Core Drive 4, ownership and possession. And this is one where I want you to sit with for a second because it is the exact same core drive that the airline was using. However, it is running in the exact opposite direction. The airline fakes ownership with digital points balance that they control. It's a number on screen that they can devalue, that they can expire when, whenever they like. My barber creates a real ownership through a relationship that is actually mine. Because a relationship is core drive five, but the part of ownership of that relationship is actually mine. She knows my hair. She's personalizing for my hair, my history, my preferences that cannot be ported to a competitor, that cannot be devalued overnight. And it didn't cost either of us a single point or dollar. Same core drive and human motivation. One brand manufactures a hollow version of it and spends a fortune to achieve that. Another person achieves the real thing for free. And then there's core drive 8 loss and avoidance. However, it is inverted in this case. Points programs are weaponizing this drive against you. You lose your miles, lose your status, you keep flying or else. They never say or else. All right, don't get me wrong, but when you get that email, you know that there's, you know, there's an or else sort of hiding underneath it. My barber uses the calm side of the same drive, the absence of risk. I know exactly the haircut I'm going to get. Trying somewhere else new is a gamble. Coming back to her is the safe choice. The loss I'm avoiding isn't a point's balance. It's a bad haircut. My barber retained me through real inconvenience. Yes, she didn't introduce the inconvenience, but the inconvenience is real and it is there, and she did so. She achieved it by using nothing. Nothing almost, but white hat drives and an actual relationship. Airline programs spend an enormous fortune on black hat machinery to retain people who will defect the moment someone offers an overall better deal. The cheap version works better than the expensive one because it's built on human connection instead of a trap. So here is your prompt for today. Run the diagnostic on your own product or service. If you strip the points, the discounts, and the digital rewards completely, entirely, what's left? What reason would anyone have to stay with you? If your honest answer is nothing or close to that, then you don't have a loyalty program. You have a price promotion with a delayed payment schedule. Deep down, the argument here is that if you have to trick someone into staying, the real problem is that what you're offering isn't good enough to keep them on its own. Real loyalty was never about better traps. It's about trust. So if you're rethinking how you can manage your loyalty and you enjoyed the kind of things that we did on this episode of Breaking down real examples looking at the core drives behind them, how to do it right, how to do it wrong. Then you will definitely enjoy and benefit from our free guide, Core Drives in the Wild. You will get a daily email from running through each and every one of the core drives looking at past episodes of this podcast, how they were using the core drives, how to do it right and what is my take as a consultant at the Octalysis group? All you have to do is click on the link below in the description, you'll be subscribed and as a value added, you'll eventually also be subscribed to my email list where I'll be sending regular emails where I also add value from the perspective of motivation, core drives and how to use this in real life, corporate and enterprise cases. And as you know, at least for now and for today, it is time to say that it's game over.