Rewards programs are meant to encourage brand loyalty. One of the earliest examples of one is S & H Green Stamps. Certain merchants, such as gas stations, grocery stores, and department stores, would give you stamps based on how many dollars you spent, generally one for every dollar. In Chicago, for example, National Food Stores and Wieboldt’s department stores issued them, as well as Magikist Carpet Cleaners and (I think) Standard Oil stations.
The idea was you’d get the stamps and paste them in a book. Each book held 1200 stamps, and when filled the book could be exchanged for things like lamps, toasters, silverware, and musical instruments. Of course, for most of the items in the Ideabook (their catalog), you needed more than one book. If you were saving up for something really big, like a TV or clock radio, you would be saving the stamps for a very long time, and there was no guarantee that the item would still be in the catalog when you were ready to get it. Businesses that issued them would have “double stamp” and “triple stamp” days to help you along. There were rival stamp companies, like Top Value and Plaid Stamps, but Green Stamps were the big one. Allan Sherman had a parody of the song “Green Eyes,” called “Green Stamps.”
When I started traveling, I became a member of as many frequent flyer and frequent stayer programs as I could, then would go out of my way to take those airlines and stay at those hotels. Their rewards were pretty good, although after a while the airlines started changing their rules on what qualified as an eligible flight. Still, if you were willing to play their game, you could get free travel and stays at hotels.
Credit cards have even gotten into the act. I have one credit card that gives me 1.5% cash back on everything. I also have an Amazon rewards card for purchases there, and a Starbucks rewards card that gives me money back on purchases there. Both cards also reward you when you use their cards at restaurants, pharmacies, gas stations, and specific other businesses.
Like rebates, reward programs make you work for the benefits, and just like rebates, a lot of people think it isn’t worth the effort. Nevertheless, “something for nothing” is a pretty powerful selling point.