In a loyalty scheme, the reward is the thing a customer gets once they reach the target: a free coffee after nine, a loaf after six, ten dollars off after ten visits. It is promised up front, so the customer knows the deal before they hand over a number or take a card, and it is the same for everyone on the card. That is what separates a reward from a discount. A discount is offered to anyone at the moment of sale; a reward is earned by coming back, and it is a thank you for a habit rather than a price cut.
A good reward has three qualities. The customer wants it, ideally because it is the thing they already come in for. It feels generous, which usually means a whole item rather than a percentage. And it costs the shop far less than it is worth to the customer, which is easiest when the shop makes or stocks it.
In practice
A bakery sets a six-stamp card, one stamp per loaf, with "a free loaf of your choice" as the reward. Its sourdough sells for $9 and costs about $2.20 in flour, salt, power and labour. A Saturday regular who buys one loaf a week fills the card in six weeks, having spent $54 on bread, and walks out with a loaf they value at $9. To the bakery, that reward is $2.20 against $54 of sales, or about 4 percent.
Compare a reward of "10% off your next shop". On a $14 visit it is worth $1.40 to the customer, costs the bakery the full $1.40 in lost takings, and is forgotten before they reach the door.
Rewards should change rarely. A regular halfway to a free loaf who finds the reward has become a free roll will notice, and will say so.
In Counter Club
The reward is a line of text up to 200 characters on the Loyalty card page, shown to customers on the join page. When a card fills, the reward code records the reward as it stood at that moment, so a later change never shrinks what a member already earned. See rewards.