The Loyalty Gap: Why Customer Income Matters More Than Banks Realize
When people think of loyalty programs, they think of retail or travel, not their bank. Financial services have been slow to adopt loyalty in meaningful ways, and when they do, it’s often a generic, one-size-fits-all model. Rewards are typically based on broad segmentation that lumps customers together by product type, geography, or income bands, but often stops short of connecting these differences to what people truly value.
Banks might feel they already account for income by offering card tiers with features that loosely correspond to income levels, for example, premium cards with travel perks for higher earners, entry-level products with basic cashback for everyone else. But this kind of tiering only scratches the surface. It doesn’t necessarily mean the rewards themselves, how customers earn, redeem, or engage, are designed around income-informed preferences.
A recent survey conducted by CORA Loyalty and the Harris Poll shows just how income shapes priorities. Those earning $100K or more prioritize convenience, higher credit limits, and lower fees. Households between $75K and $99.9K are more sensitive to interest rates, followed by security features and convenience. Lower-income households (below $75K) focus heavily on convenience and affordability, with fees and credit limits carrying significant weight. While fees matter across income levels, rewards and redemption options become critical differentiators for higher earners: 83% of those making $100K+ cite rewards as a key factor in their card decisions.
These findings reveal a missed opportunity: simply segmenting by income isn’t enough. Banks must translate income insights into tailored loyalty strategies that resonate with what different households want.
For higher income customers, that means offering flexible rewards, such as access to a marketplace of experiences, premium merchandise, or transferable points, to reflect their desire for choice and exclusivity. For mid and lower income households, rewards should emphasize simplicity, competitive fees, broad acceptance, and security features like real-time alerts or two-factor authentication, which build trust. Ignoring these nuances can leave customers feeling disconnected from their bank, not just from the perks, but from the sense that their financial needs are understood.
Moving from a generic to a personalized loyalty model doesn’t require creating entirely new products. Rather, banks can evolve existing card programs to better reflect what income-driven segments value:
- Audit existing reward offerings: Assess whether current accrual rates, redemption thresholds, and reward categories disproportionately favor one income group.
- Align messaging with priorities: For example, emphasize low fees and wide acceptance in communications to lower income segments, and highlight flexible, aspirational rewards to higher earners.
- Leverage data thoughtfully: Go beyond income as a blunt segmentation tool. Combine it with spending patterns, category preferences, or life stage indicators to avoid stereotyping and build richer profiles.
- Test and adapt: Use A/B frameworks that track activation, spending, and redemption behaviors across income groups to measure whether tailored strategies drive higher engagement.
- Stay mindful of equity: Income-based personalization can add value, but banks must avoid approaches that appear exclusionary or discriminatory. Transparency and fairness in how benefits are offered are key to avoiding regulatory or reputational risk.
Done right, income informed loyalty strategies can increase primary card usage, improve customer satisfaction, and deepen relationships. In our experience, Banks that personalize loyalty strategies to better reflect customer income and spending priorities have seen double-digit increases in primary card engagement within months, according to industry analysis and case studies. [1]
Banks have a major opportunity to move beyond tiered products alone and offer loyalty programs that speak to how customers spend, what they care about, and what keeps them coming back. Income is just one powerful lens for this but one that’s too often overlooked. By intentionally designing rewards and communications to reflect income-informed insights, banks can transform loyalty from an afterthought to a differentiator that grows share of wallet, transaction frequency, and long-term trust.
About Author:
Beth McCoy is a seasoned executive with over two decades of leadership in the loyalty and airline industries. As President of CORA Loyalty, she leads the strategic direction, organizational culture, and business performance across a portfolio of companies, including RewardOps, Points at Work, and Carlson Marketing Solutions. She also serves as President of RewardOps, where she oversees operations, innovation, and growth.
Beth is recognized for her ability to develop and scale end-to-end loyalty solutions that drive sustainable revenue and deepen customer engagement. Her entrepreneurial approach has led to the successful launch and growth of two loyalty-focused startups. Throughout her career, she has collaborated with leading global brands such as TD, Air Canada, RBC, Petro‑Canada, U.S. Bank, WestJet, Air Miles, NAB, MBNA, and Flybuys.
Beth’s leadership is grounded in a deep understanding of the evolving loyalty landscape and a proven track record of delivering value through innovation, strategic partnerships, and operational excellence.
[1] Source: McKinsey & Company, “The Power of Personalization,” 2021.