89% executives misread customer loyalty, threatening business: PwC
LONDON, ENGLAND — A new PwC survey has found a major disconnect between how executives and customers define loyalty, posing a threat to business futures.
According to CX Dive, 89% of business leaders believe customer loyalty has increased, while only 39% of consumers agree—highlighting a critical perception gap that could undermine company strategies.
Different views of loyalty drive a 50-point gap
A 50-point chasm exists because executives and customers operate with entirely different definitions of loyalty. PwC’s U.S. Principal of Customer and Enterprise Strategy George Korizis explains that leaders track measurable behaviors like repeat purchases and renewals, creating a false positive of strong engagement.
“Customers tell us it’s decided much earlier — often the very first time they use the product. If you’re not measuring that early experience, you’re missing the biggest driver of loyalty,” said Korizis in an email.
Consumers, however, define loyalty emotionally—by whether they would recommend the brand, feel connected to it, or stay if a competitor offered something similar.
“In our research, executives overwhelmingly said discounts and rebates are the core of loyalty programs,” noted Korizis.
He then added, “And yes — customers want those. But they also want things executives tend to underweight: exclusive access, community and experiences that feel designed for them personally.”
This fundamental misalignment means companies are misreading their market position and misallocating resources. The impact is that the customer base is fragile, with more than half of the shoppers stating that a single negative experience with a product is enough to prompt them to abandon a brand.
A service-oriented approach puts service interactions at the center of attention, rather than the experience of the initial product, thus endangering the entire system with customer leakage.
Loyalty programs face obsolescence
Current loyalty initiatives are failing, with 3 out of 5 executives admitting their programs don’t deliver needed outcomes. The problem stems from designing programs around corporate tracking capabilities rather than customer desires.
While companies prioritize discounts and rebates, customers equally value underweighted elements like exclusive access, community, and personalized experiences.
Forty-eight percent of executives consider their loyalty program will be outdated in three years, due to a fundamental change in consumer behavior. Korizis singles out the experience supply chain, wherein clients have turned to external influencers, reviews, and AI search outside of apps managed by companies.
This signals a future where successful loyalty must integrate into the broader digital ecosystem customers already inhabit, moving beyond corporate-controlled platforms to remain relevant.
“The programs that survive will be the ones that fit how customers already want to engage, not ones that force them into a company-designed system,” Korizis concludes.
