Whether that counts as low loyalty depends on how you measure it and what your rewards teach people to do.
This guide gives marketers and loyalty managers dated, sourced figures on how Gen Z discovers, evaluates, buys and switches, then maps each behavior to earn rules, rewards, tiers and KPIs.
Generation Z (born 1997-2012) rarely reaches the thresholds that loyalty programs set for millennial wallets, so the first fixes sit in earn and tier design. Purchase-only earn rules stall for low-frequency, low-AOV members, and tier promotion rules sized for older spend look unattainable.
Consumer packaged goods brands face the same low-frequency, low-AOV pattern, and the approaches in these top CPG loyalty programs show how earn and tier design can adapt to it.
We recommend starting with non-transactional earn rules, because they give low-frequency members a way to progress between purchases. Open Loyalty builds API-first loyalty engines that let enterprise brands configure earn rules, tiers and rewards for different customer segments. To address this pattern, here are five actions to take:
Generation Z (born 1997-2012) spans ages 13 to 29 in 2026, according to Pew Research Center's cohort definition.
Gen Z's spending power is expected to grow to $12 trillion by 2030, according to NielsenIQ and GfK in collaboration with World Data Lab projects (PwC Gen Z Spending Habits: The Paradox of Consumer 2025). As more of the cohort enters the workforce, that growth increases Generation Z’s purchasing power across the consumer market, and brands are rethinking how they engage younger shoppers; the latest loyalty software trends show where program technology is heading.
The aggregate figure hides a 16-year spread, which is a wider life-stage range than many program designs assume for previous generations. A 14-year-old with pocket money and a 28-year-old with a salary share a cohort label but not a basket size, so one set of earn thresholds fits neither.
We recommend splitting Generation Z into three bands, each with its own earn rules, rewards, and consent handling:
Consent is the constraint that most affects the teen band. GDPR Article 8 sets the age of digital consent at 16 by default, and member states may lower it to 13, so check each market before enrolling anyone under 16.
Zero-party data, such as preferences a member states in a profile quiz, suits all three bands. It lets you personalize without behavioral tracking, which keeps the teen band's data footprint small.
The bands also carry different breakage expectations. Teens will redeem rarely, so rewards should not depend on spend they cannot make. Even so, the wider business benefits of loyalty programs still apply to these younger members, because retention and engagement gains do not depend on frequent redemption.
Six dated statistics describe Generation Z (born 1997-2012) well enough to plan a 2026 loyalty program, but only some come from samples that include European markets. Many figures circulating in blog posts have no traceable primary source.
Each row names the publisher and year, and the last column says how far to trust the figure in the EU. To see what programs deliver once they are live, compare these figures against published loyalty program results.
None of these sources publishes a redemption rate for Generation Z, so that benchmark has to come from your own program data, split by age cohort.
The 36% loyalty figure and the 48% participation figure come from different publishers and samples, so they should not be subtracted from each other. Read together, they suggest that joining a program and feeling loyal are separate behaviors.
We recommend using the two "Likely transfers" rows as planning assumptions. Treat every row marked "Validate locally" as a hypothesis to test against first-party cohort data before it shapes earn rules or budgets. Once those cohort-level numbers are in hand, customer activation tactics can help turn new Generation Z members into engaged, repeat participants.
Generation Z (born 1997-2012) is the cohort most associated with creator-led discovery and in-app buying (Sitecore). Those shopping channels produce loyalty revenue only when the buyer can be matched to a member profile. Shifting expectations make that match harder, so see how sustainable loyalty programs adapt.
In PwC's survey, 46% of consumers purchased products directly through social media, up from 21% in 2019 (PwC 2024 Voice of the Consumer Survey). This figure reflects all consumers surveyed, not Gen Z specifically.
We read it as a sign that in-app checkout is now common, and your own order data should show the Gen Z share. Separately, 53% of Gen Z use buy buttons on social media platforms, which shows how often social commerce can convert without leaving the app.
Attribution is where programs break. Depending on setup, TikTok Shop and other in-app checkouts can hand the brand order data with limited or masked buyer identifiers, so the purchase never reaches a member record.
Gen Z's path-to-purchase on digital platforms is often compressed into a single mobile session, which raises the stakes for identity resolution when discovery and checkout happen on the same device. Three identity-resolution failures are worth auditing, and each has an early sign in data you already hold:
Program implication: add a post-purchase claim step, matched on email or phone, that merges guest orders into the member profile. Tie referral program links and creator codes to member IDs, not to browser sessions.
Add non-transactional earn rules for user-generated content, such as photo reviews, only after matching works, because an unmatched post cannot earn points.
An API-first engine such as Open Loyalty lets teams post external orders as events and merge profiles afterward. We'd suggest tracking matched-member rate by source monthly and using it as a launch gate for any creator campaign.
A mobile wallet pass removes the install step for Gen Z members, but mobile-first expectations do not eliminate physical stores when nearly 50% of Gen Z’s total spending is still in-store, so reserve the dedicated app for non-transactional earn rules that a pass carries poorly.
The trade-offs side by side (our assessment, not a benchmark):
The store-to-online blend depends on one member ID that every channel resolves to. Whichever route you take (custom build, legacy SaaS, or an API-first engine such as Open Loyalty), test whether an app challenge, a till scan of the pass, and a web order post to the same balance and tier in real time.
Custom builds typically pay for that in engineering time. Legacy SaaS often limits which earn rules can fire per channel, which matters once you want different rules in mobile apps and in store.
Program implication: issue the pass at first purchase or sign-up, and use the app for non-transactional earn rules such as reviews, preference answers (zero-party data), and content engagement, since personalized shopping experiences help retailers build stronger connections with Gen Z and belong in the app layer. Those rules raise frequency between purchases and give the pass a reason to stay in the wallet.
Gen Z is price-sensitive but selective, and often better described as price conscious than purely price-led. A 2025 YouGov and Business Insider survey found 71% of Gen Zers sometimes or always buy cheaper versions of name-brand products (YouGov / Business Insider, 2025). Another reason lower-priced substitutes feel acceptable is that 67% of Gen Z believes private label products match national brands in quality.
That survey figure covers dupes only. Our interpretation is that dupe buying and secondhand purchasing point to a cohort that trades down in some categories while still paying for products it values.
Dupes and resale marketplaces give a brand's customer two routes to a lower price. More than half of the millennial generation and Gen Z consumers prioritize buying secondhand clothing, which reinforces how central resale has become to shopping behavior. A percentage-off loyalty reward adds a third, and it can teach members to wait for the voucher before buying. Rewards are where a program can protect margin.
The margin trade-off, using illustrative inputs (an €80 basket at 50% gross margin, not benchmarks):
Under these assumptions, the 20% voucher consumes 40% of the order's gross profit. Early access consumes 7.5%. A voucher only pays back when the order is incremental, and members who hold purchases until a voucher arrives are less likely to supply that.
Early signs that vouchers are training members to wait:
The Nike membership shows the access model: member-only products and releases give members a reason to sign in that carries no price cut.
We recommend funding tier promotion rules with access and status rewards, and keeping percentage-off vouchers for win-back of lapsed members, where an incremental order justifies the cost. The caveat is category: access rewards only work when the brand has product members want first, and limited drops cap how many members you can reward.
Sustainability and brand values shift what Generation Z (born 1997-2012) says it will buy more than what it puts in the basket, so treat stated values such as social responsibility and ethical practices as a segmentation signal and reward verified actions instead of claims.
Stated intent is cheap to give and easy to survey. According to the Deloitte Global Gen Z and Millennial Survey 2025-65% of Gen Z respondents say they are willing to pay more for environmentally sustainable products or services (Deloitte Global 2025 Gen Z and Millennial Survey). Our judgement is that price and convenience still decide most baskets, which is why the stated-versus-actual gap persists. Even so, many support brands that match their personal values, and may prefer brands with transparent supply chains, which makes ethical sourcing easier to communicate credibly.
The decision rule has two steps:
These are non-transactional earn rules, and they fit values-led members because the reward matches the behavior they say they care about. Compare 90-day retention between tagged members who complete a verified action and those who don't. That cohort comparison shows whether the values signal predicts loyalty.
The rule needs a resale or take-back operation behind it. Without one, nothing is verifiable, and a preference tag with relevant content is the safer limit.
Generation Z (born 1997-2012) is easy to win attitudinally and harder to hold behaviorally. Before concluding that Gen Z loyalty is low, test whether switching reflects price dependence created by a discount-led program.
Attitudinal loyalty is preference and attachment; behavioral loyalty is repeat purchase. Morning Consult's 2024 Gen Z Brand Engagement Report found only 36% of Gen Z consumers feel loyal to any brand (Morning Consult). That is a stated-attitude figure. It does not show why spend splits or lapses. Gen Z also values authenticity and often relies on peer recommendations before making purchasing decisions.
The comparison below is directional and reflects our reading of the sources, not a measured benchmark:
Decision rule. Take Gen Z members whose spend lapsed or split. Measure the share of their orders placed with a discount, then read it against engagement and purchase frequency:
"High" and "low" need a reference point. Compare Gen Z with your older member cohorts in the same program, because a heavily discounted catalog makes every cohort's discount share look high. If Gen Z sits well above the others, price dependence is the likelier driver. That also helps explain why Gen Z may favor niche and indie brands over established corporate brands when trust feels higher.
Two data conditions can produce a false "low loyalty" reading:
Each behavior maps to one loyalty mechanic and one KPI, and the mapping depends on the shopping preferences and purchasing behaviors you are trying to change, not on Gen Z alone. The table pairs each behavior with the mechanic that fits and a way to measure it.
Tier thresholds are where most Gen Z programs break. A top tier set at, say, $1,000 of annual spend (an illustrative figure, not a benchmark) assumes a millennial wallet, so younger members never see a reachable next tier. We recommend adding a second promotion path: completed challenges, referrals, and profile data count toward status, with spend still required for the top tier.
Non-transactional earn rules carry their own risk. Points for likes, shares, or app opens attract members who farm rewards without buying, which inflates engagement and depresses margin. Cap each action, pay out only after a downstream purchase where possible, and judge the rule by incremental frequency and margin per cohort, not by action volume; in other words, assess purchase drivers by lift, not engagement volume alone.
Mechanic flexibility also decides the build path. A custom build can express these rules but takes engineering time for every change, and legacy SaaS often fixes earn and tier logic to spend.
An API-first engine such as Open Loyalty lets a CRM team change earn rules, challenge parameters, and promotion paths without a rebuild, which matters because Gen Z thresholds will need retuning after the first cohort data arrives.
The Gen Z loyalty programs that work pair a spend-based earn rule with a reason to engage between purchases: community, early access, or status a younger buyer can reach. Four public programs show the pattern, including one from luxury, and our mechanic analysis follows. These examples also show how brands can tailor product offerings to attract gen without relying only on discounts.
The programs side by side:
Sephora Beauty Insider gives a first-time buyer a rewards account immediately, then layers review and Q&A participation on top of spend. Starbucks Rewards shows what challenges do for frequency. Nike membership shows that access to drops and content can carry a program where discounts would erode margin.
Luxury exposes the tier-design problem. Net-A-Porter's EIP program suits established, high-spending clients, but a younger shopper cannot see how to climb. Our reading is that invitation-only status works against Gen Z's preference for visible, reachable progress.
We recommend choosing the mechanic by condition:
A referral program is a low-cost mechanic to layer onto any of these, because it turns peer recommendation into acquisition. Whether it lowers CAC depends on how its reward cost compares with your current paid acquisition spend.
Measure Gen Z loyalty with three views side by side: cohort retention, redemption rate by age band, and non-purchase engagement as the leading indicator. Repeat purchase alone will tell you late, and it will not separate attitudinal loyalty from discount-driven behavior.
The measurement set:
Redemption rate, split by age band, shows whether younger members can reach rewards. A low rate among 18-21 year olds can signal thresholds built for older spend patterns, which leaves high breakage and earn rules that need review.
Treat non-purchase engagement as a hypothesis to test. Compare day-90 retention for members who completed one gamified challenge or shared zero-party data in their first 30 days against those who did not. If the gap holds, that action becomes the onboarding target.
Count a referral program member only after the second purchase. Referred sign-ups who never return inflate the numbers and hide the true CAC.
Four shifts shape Generation Z (born 1997-2012) consumer behavior in 2026, reflecting Gen Z’s evolving preferences in the digital era, shaped by digital technology and technological advances since childhood: social commerce, AI-assisted shopping, resale and secondhand buying, and rising income. Change the program now only when your own member data shows the shift and an existing earn rule can answer it. Monitor the rest.
Income deserves the closest watch. Leave tier promotion rules alone until the cohort's spend nears the threshold, then review promotion rates by age band each quarter. The rule suits brands where Generation Z is a meaningful share of members; with a small share, monitoring everything is reasonable. Adapting to these shifts can support sustained growth, not just short-term campaign performance.
Generation Z (born 1997-2012) loyalty is harder to earn than it was for some older generations because switching is easy and expectations are shaped by the digital age. Low switching costs and dupe culture put alternatives one search away, unlike other generations that built loyalty in less digital shopping environments. Attitudinal loyalty gets a member through the door; repeat purchases show whether it converts.
Brands that target Gen Z build loyalty by rewarding participation as well as purchases, using rewards and messaging that match the target audience instead of generic loyalty offers. Non-transactional earn rules, such as points for reviews or referrals, drive participation, while gamified challenges lift purchase frequency; Gen Z expects companies to take meaningful action on social and environmental issues, so participation mechanics should reflect that where relevant. Launch two or three rules tied to one KPI each, and retire any that fail to move frequency or redemption rate.
Gen Z consumer behavior is moving discovery from search and stores to social commerce and creator-led recommendations, with gen z shoppers moving fluidly between online shopping, social feeds, and stores rather than treating them as separate shopping channels. Many shoppers find products on TikTok or Instagram, then compare prices against resale listings and dupes; 53% of Gen Z have used “buy” buttons on social media networks, reinforcing how directly those platforms shape shopping behavior. Loyalty programs need identity resolution across social, app, and store, because the sale often starts outside owned channels.
Gen Z loyalty programs need mobile-first access, quick early rewards, and perks beyond discounts, such as experiences, because the same instant gratification they get from digital experiences shapes loyalty expectations too. Sephora Beauty Insider and Starbucks Rewards both run app-based earning with perks beyond price. 53% of Gen Zers have used 'buy' buttons on social media, so program access and redemption need to work across e commerce and social touchpoints. We recommend tier promotion rules members can reach within a few months, since distant status goals lose low-switching-cost shoppers.
Measure Gen Z loyalty on two axes: behavioral loyalty (repeat rate, cohort retention) and attitudinal loyalty (survey signals, zero-party data). Add redemption rate by cohort, because low redemption signals rewards that miss what Gen Z members value. Segment Gen Z by acquisition month, since blended averages hide early churn.
A loyalty program Generation Z (born 1997-2012) will use rewards more than purchases. Some of this cohort’s key characteristics include growing up in the digital era and being more likely to study STEM subjects than humanities, which raises expectations for fast, intuitive program design. It needs non-transactional earn rules for reviews, referrals, and content, gamified challenges, and tier promotion rules a member can reach without heavy spend.
Mechanics like these need an engine where you can change earn rules and tiers without a rebuild. A custom build offers that flexibility at high cost, and legacy SaaS often constrains it. Brands are also pushing brands to adapt around the critical factors shaping purchasing decisions, especially convenience, relevance, and value.
An API-first engine like Open Loyalty, used by 100+ enterprise clients across 60 countries, sits between the two. Adapting loyalty design to these younger consumers can help brands attract Gen Z, engage them more effectively, and strengthen long-term performance in the consumer market. Bring your current earn rules and tier structure to a working session: Talk to our team.
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