Where Co-Brand and Travel Rewards Are Heading in 2026 and Beyond
In a world overflowing with content — and opinions — it has become increasingly difficult for loyalty executives to separate noise from signal. As I prepared my keynote for the 2025 Co-Brand and Travel Rewards Conference, I began the way many do: by jotting down my own views about the direction of co-brands, travel loyalty, and the economics shaping the next generation of rewards programs. Then I held those instincts against two things that matter far more than opinions: data and evidence.
At The Wise Marketer Group, we analyzed more than a dozen research studies this year from Amperity, Arrivia, Ascenda, Barclays, CarTrawler, CORA Loyalty, Ernst & Young, Engage People, J.D. Power, and others. You can find each of these reports in The Loyalty Academy™ VAULT.
Paired with the 9,000-plus articles in our archives, we looked for the common narratives emerging across the travel, payments, and loyalty landscape.
Six major themes rose to the top — themes that form a practical framework for how airlines, hotels, and issuing banks should be planning for 2026 and beyond.
1. Demographic Disruption
The loyalty market is strong: 79% of U.S. travelers now rely on loyalty programs, the highest ever recorded. At the same time, the profile of the cardholder universe is shifting rapidly.
One of the most significant findings comes from the widening gap between financially healthy and financially challenged consumers. More than half of credit card users fall into the latter group — those carrying revolving balances, struggling with payments, and increasingly disengaged from traditional value propositions.
This creates strategic tension. Premium cards dominate media spend and cultural visibility, and more than 20% of U.S. cardholders now pay annual fees above $100. But premium growth masks the reality that the majority of Americans don’t behave like the “super-prime traveler” showcased in advertising.
The implication is clear: your most valuable cardholder in 2026 will not look like the one you targeted in 2020. Segmentation based on financial health, travel frequency, and behavioral economics will matter just as much as generational labels.
2. Generational Breaks in Travel Loyalty
The nuance behind demographic segmentation runs even deeper. Millennials and Gen Z approach loyalty with expectations fundamentally different from Boomers and Gen X — not just in preferences but in participation and motivations.
Participation is lower among younger travelers.
- Gen Z (65%) and Millennials (70%) engage at meaningfully lower levels than older cohorts.
- Yet those who do participate are power users: 94% of Millennials use tactics to maximize points, and 72% rely on loyalty to stretch travel budgets.
Culture is shaping travel behaviors.
- More than 80% of younger consumers say their travel ideas come from on-screen sources.
- Shows like Squid Game and The White Lotus have directly influenced destination interest, in some cases driving triple-digit surges.
Parents emerge as a distinct and underserved segment.
- Nearly 90% say they would travel differently — or less — without rewards. And parents show rising interest in cruise loyalty, making them one of the fastest growing subsegments.
All of this signals an industry where “Millennial” no longer describes a single persona; rather, it splinters into micro-segments defined by life stage, financial posture, parenting status, digital behavior, and cultural influence.
3. Personalization as the True Loyalty Currency
Across nearly every study this year, one idea dominated: personalization has overtaken experience, points, and convenience as the top driver of loyalty value.
- 68% want rewards tailored to purchase activity
- 72% say personalization drives their engagement
- Tailored rewards are the #1 feature that makes Millennials, Gen X, and Boomers feel valued
- Gen Z places the highest value on surprise-and-delight experiences
A key tension sits beneath this enthusiasm: comfort with data sharing is collapsing among the youngest travelers. Only 11% of Gen Z is “very comfortable” sharing data, compared to 31% of adults 25–44.
This means brands must earn personalization — through trust, transparency, and utility — rather than treat it as a given. And “personalization” must evolve beyond messaging to include choice, access, flexibility, and relevance. More than one-third of consumers now say access to partner brands is one of the most valuable loyalty features.
The new equilibrium is simple: If you can deliver personalization at scale, you can generate revenue at scale.
4. Market Pressure and the Economics of Loyalty
While consumer expectations rise, external pressure is bearing down on the traditional travel-loyalty model.
Regulatory headwinds
- In late 2024, the U.S. Department of Transportation opened an inquiry into frequent flyer programs, examining issues like dynamic pricing and reward transparency. The Department of Justice is conducting a broader competitive review.
- Meanwhile, the Credit Card Competition Act continues to surface, keeping potential interchange compression on the table.
Consumer financial stress
- Credit card delinquency rates remain at historic highs, putting downward pressure on spend performance and elevating sensitivity to fees and APRs.
Competitive shifts
- Premium non-travel cards and practical cash-back cards pose real threat vectors to high-value segments.
One practical response lies in expanding the portfolio beyond traditional credit constructs. Wyndham and Southwest both announced debit-based reward products — a smart move given that 70% of Gen Z uses debit weekly, and many consumers prefer a debt-free lifestyle. Debit rewards aren’t a fallback; they’re a strategic bridge to younger and credit-averse audiences.
5. Digital Backbone: Where Payments and Loyalty Converge
The future of travel loyalty will sit at the intersection of loyalty, payments, and digital identity.
Mobile is now the enrollment gateway. Tokenization is bringing loyalty currencies into digital wallets, creating utility and visibility. And AI continues to accelerate experimentation, even as organizational readiness lags.
Only 18% of organizations use AI in production to resolve customer identities. Trust in fully autonomous AI agents fell from 43% to 27% in a year. Customers, meanwhile, want AI-enabled value but expect personalization and control — not surveillance or guesswork.
Strategically, this requires a shift from tier-based thinking to mosaic-based design. Customers no longer sort themselves cleanly into ladders. Their needs vary by financial health, digital fluency, travel aspiration, and engagement appetite. Issuers and brands must design products that accommodate this complexity.
6. Experiences, Ecosystems, and a New Flight Path Forward
Value propositions are evolving from “earn and burn” to “access and identity.” Experiences — from property benefits to in-cabin surprises — increasingly differentiate programs. But ecosystems matter just as much.
Women gravitate toward comfort perks. Men lean toward exclusivity. Boomers prioritize checked bags and boarding. Parents maximize group dining and shared spend. JetBlue’s family pooling and Wyndham’s subscription model show how program design is widening to accommodate lifestyle patterns, not just travel patterns.
Which brings us to the answer many loyalty leaders are seeking:
The co-brand of the future is a platform, not a product.
A platform built on four pillars:
1. Choice — partners, categories, earn structures, redemption paths
2. Subscription — profitable bundles tied to identity and lifestyle
3. Fintech — embedding payments, rewards, and loyalty into everyday moments
4. Debit — serving financially challenged and younger users without shrinking value
The winners will be those who redefine their cardholder, not just their card.
A Clearer View of 2026
Demographics are fragmenting. Financial behaviors are diverging. Digital expectations are accelerating. And ecosystem partnerships are expanding what “loyalty” means.
For travel brands and issuers, the path forward is both challenging and full of possibilities:
- Embrace multi-segmentation
- Invest in intelligent digital tools
- Broaden product portfolios
- Reimagine “rewards” through the lens of experience and identity
If there was one takeaway from the research that informed this keynote, it is this: the future of co-brand isn’t about points or perks — it’s about alignment. Alignment between what consumers need, what they can afford, and how they aspire to travel.
That alignment is the real flight path forward.