When it comes to customer loyalty, your reward mechanism sets the tone for everything.
Whether you're building from scratch or retooling an existing program, the decision between cashback and points-based rewards isn’t just cosmetic. It affects adoption rates, redemption behavior, customer perception, and ultimately, your brand’s bottom line.
According to recent research by The Wise Marketer and Engage People, a staggering 86% of consumers prefer financial-based rewards like cashback or account credit. These were followed by discounts and rebates (65%), while points-based incentives trailed further behind. The takeaway? Consumers are feeling the economic squeeze—and they want rewards that help ease it.
That means: the more your program reduces costs or simplifies savings, the more likely it is to drive engagement. In this article, we’ll break down both cashback and points-based programs, then give you a checklist to help guide internal discussions and stakeholder buy-in.
Cashback has become the go-to loyalty format—especially in financial services. It's clear, direct, and tied to real money. In 2024, the global cashback market is estimated to be worth over $200 billion (Statista).
Why it works:
Where it falls short:
📌 Expert tip: “Cashback wins for simplicity—but simplicity doesn’t always inspire loyalty.”
On Reddit threads like r/PersonalFinanceCanada and r/Churning, users often optimize cashback to the cent—but rarely mention brand attachment. It’s practical, not personal.
Points-based rewards take more explaining—but they can unlock a different kind of value. When well-executed, points systems create a sense of progression, exclusivity, and play.
Why it works:
Where it falls short:
📌 Pro tip: Tie point values clearly to real-world outcomes to prevent frustration and build trust.
Feature |
Cashback |
Points |
Ease of Use |
✅ Very easy |
⚠️ Varies by program |
Budget Appeal |
✅ Strong |
❌ Weaker |
Gamification |
❌ Limited |
✅ Built-in |
Emotional Engagement |
❌ Transactional |
✅ Aspirational |
Before you lock in your reward structure, run through this free quiz to check across key features.
👉 Curious how your current rewards stack up?
It’ll help you to think about your primary goals, audience behavior and your brand.
💡 Still not sure? Hybrid models (e.g., cashback + points or points + donations) offer flexibility without forcing a binary decision.
In times of economic pressure, programs that offer immediate financial value tend to outperform. Olive’s own data and G2 reviews confirm this: ease of use and reward clarity are top drivers of satisfaction.
Users consistently rate cashback programs higher for transparency and ease, but point systems win when there's strong support, flexible redemption, and gamified status.
📖 Sources to explore:
There’s no universal winner between cashback and points. What matters is alignment with your brand, audience, and goals.
Start with the structure that makes sense for today—and don’t be afraid to test, hybridize, or evolve. After all, true loyalty is built on flexibility and value.
Reach out for a free demo with an Olive specialist.