Grading my own predictions at Cobrand & Travel 2026
At AI Connect’s Co-Brand & Travel Rewards 2026, Wise Marketer Managing Editor Bill Hanifin, who is also CEO of Wise Marketer Group, held his 2025 predictions up against a turbulent year.
There is no shortage of pundits in our industry, but few go back and check their work. So at this year’s conference, I did something I don’t see enough speakers do: I graded myself against the five themes I laid out last year.
2026 gave us plenty to grade against. War in the Middle East disrupted tanker traffic through the Strait of Hormuz, and jet fuel roughly doubled between February and April. U.S. airfares rose about 27%. Spirit Airlines, which had built its restructuring plan around fuel at roughly $2.24 a gallon, was paying about $4.50 by the end of April and ceased operations on May 2, the largest U.S. airline collapse in a generation.
For a prognosticator, a year like that is either a disaster or a get-out-of-jail-free card. Here is how it came out.
The scorecard
| 2025 theme | 2026 verdict |
| Demographic Disruption | Confirmed, sharpened |
| Personalization as Loyalty Currency | Confirmed, relocated to the card |
| Market Pressure & Loyalty Economics | Confirmed, now regulatory |
| Digital Backbone | Confirmed |
| Experiences, Ecosystems & Value | Confirmed, with a value caveat |
The K-shaped traveler
J.D. Power now counts 60% of cardholders as “financially unhealthy,” up from 56% and the highest on record. Late-stage card delinquency reached 12.8%, the highest since 2011. Meanwhile, prime-plus cardholders drive roughly 85% of U.S. card spend, which explains why issuers keep their focus on premium.
The non-prime traveler wants something different. Concora Credit found only 9% of this group value points or miles offers, and the ability to earn or use points ranked dead last. Lowest total price and no hidden fees ranked first and second. Debit rewards cards from Wyndham, Southwest and United are one answer, but incorporates a level of friction as customers must open a new deposit account. All of that runs against consumer’s expressed desire for simplicity.
The lesson: loyalty leaders will not choose between premium and value. They will design for both without confusing either.
Personalization has a new address
Personalization still matters, but travelers now meet it through the program and the co-brand card more than the seat or the room. The card moves on a product cycle; the cabin moves on an aircraft-retrofit cycle. For example, Alaska Airlines’ Starlink rollout takes about two years, while American’s retrofitting of seatback screens will take roughly fifteen in total.
The card is doing the emotional work the cabin used to do. And the fight has moved from who issues the best card to who owns the trip. Chase Travel has booked $13 billion and is now the third-largest U.S. leisure seller, while Visa launched Destinations to put the network itself in the business of curating travel.
Devaluation meets regulation
Marriott and Hyatt both devalued in 2026: Marriott openly, Hyatt while calling it an “enhancement.” Hyatt’s new five-tier chart pushed Category 8 peak nights at properties like Park Hyatt Tokyo from 45,000 to 75,000 points, and its Investor Day targets $105 million in credit card and loyalty EBITDA by 2027, double 2025.
Regulators are watching. On August 19, the FTC proposed an enforcement policy on undisclosed personalized pricing, a/k/a surveillance pricing. Senator Ruben Gallego’s One Fair Price Act sits in committee, and New York and Maryland already have state versions.
Much of this conflates covert surveillance pricing with permission based, opt-in loyalty programs. We have a strong consent-based case, yet our industry was nearly absent from the FTC comment period and the congressional hearings. Trust should be viewed as even more than a foundation to strong brand affinity, it is now also regulatory insurance.
AI upgrades the offer, not the checkout
Card-linked offers are moving from mass to personal and from passive to intentional. Targeting has moved to the SKU level, generative AI writes the offer, and machine learning predicts who will redeem. Two good examples we discussed are Flying Blue, which launched a personalized, merchant-funded offer ecosystem in its app, and IAG Loyalty, which grew British Airways’ card-linked merchant network from 10 to 100 in 15 months.
Consumers are maintaining a line between evaluation and purchase. Between 72% and 77% use AI for shopping discovery, yet 55% are not comfortable letting an AI agent complete a purchase. Accenture found only 9% open to fully autonomous buying.
That gap is where loyalty programs and card-linked rewards can still own the moment.
Higher Liquidity, Less Value
Points are now spendable almost anywhere: FIS Premium Payback at the terminal, Amazon Shop with Points across six major issuers, PayPal’s Pay with Rewards. But the benefits of ubiquity are being offset by a dilution in value. Convenience redemptions typically return 0.7 to 0.8 cents per point, against 1.5 to 2 cents or more through transfer partners.
As members notice, that gap could become the next competitive battleground in loyalty program value proposition management.
Worth more on paper, more fragile in practice
As we walked through this score carding exercise, we noted several times where the loyalty program and co-brand card outpaced the airline experience itself. That raises a long-debated question: is the loyalty program worth more than the airline, and could it exist without it? Answering the question may be appear to be the domain of travel loyalty geeks, but the data reveals some essential truths.
Delta’s SkyMiles was valued at $31.7 billion earlier this year, representing about 61% of Delta’s market cap, and Amex pays Delta roughly $8.2 billion a year to issue miles across its premium card set. AAdvantage is valued at 317% of American’s market cap, an impressive number, but it says as much about a depressed stock price as anything. The value of United Mileage Plus, Avios, and Southwest Rapid Rewards were 71%, 43% and 47% respectively when compared to the market cap of the related airline.
The importance of the frequent flyer program as a corporate asset is unquestionable. But it certainly can’t exist apart from the airline. Spirit offers the reality check. Bank of America kept Free Spirit cards active after the shutdown, but the points became non-redeemable and non-transferable. In other words, the payment rail kept working while the loyalty value underneath it died the same day. Final answer: the program is a brilliant contributor to airline profitability but has no product to sell without an operating carrier.
I wrapped up by sharing “three things worth losing sleep over”:
- The co-brand card is winning every fight it is in, while the airline risks becoming an optional participant in its own loyalty program. Where does an acceleration of this trajectory lead us?
- Loyalty programs have never been worth more on paper, or more fragile in practice. We need to care more about loyalty finance and not treat decisions to tinker with point/mile valuation without consideration of the impact on our customers.
- Brands of all types have never had more ways to reach a loyalty program member or been closer to losing their trust. More attention and analysis of channel choices and redemption trends can preempt brand damage and lost trust.
Over the past year, the card learned to fly faster than the airline. Let’s be sure it doesn’t forget who’s still in the cabin.
