MUMBAI: India’s channel loyalty market, estimated at Rs 26,800 crore, is undergoing a quiet makeover. What once ran on flashy rewards and incentive schemes is now being rewired around something far less glamorous but far more measurable: return on investment.

According to the Channel Loyalty Report 2026 by Almonds Ai, brands are moving away from enrolment numbers and gift-driven motivation, and towards loyalty programmes that track behaviour, productivity and measurable business impact.

The shift is partly a response to fatigue among channel partners. The report notes that 51 per cent of partners are enrolled in six or more loyalty programmes, yet actively engage with only a handful. In other words, the rewards race has reached a saturation point.

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Instead of piling on incentives, companies are beginning to design loyalty initiatives as long-term growth engines rather than short-term promotional pushes.

The research highlights several trends shaping the next phase of channel engagement. Around 80 per cent of retailers and last-mile influencers prefer mobile-first redemption platforms, signalling a clear demand for frictionless digital experiences. Meanwhile, 95 per cent of brands say they are shifting towards sustainable and purpose-driven loyalty frameworks, reflecting wider changes in corporate strategy.

Another major shift is the widening definition of what deserves a reward. Nearly 65 per cent of B2B partners believe activities such as training, digital adoption and programme participation should be recognised alongside sales performance. The result is a move away from pure transaction-based incentives to behaviour-led loyalty.

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Technology is also stepping into the spotlight. The report points to a growing role for AI and predictive analytics, helping brands identify disengaged partners early, improve programme transparency and maintain regulatory discipline across large partner networks.

Almonds Ai co-founders Abhinav Jain and Apurv Modi, said the industry is entering a more mature phase. “Channel loyalty has entered a new phase. It is no longer about how many partners enrol or how many rewards are redeemed. It is about measurable growth, disciplined compliance and structured engagement,” they said.

Their message to brands is simple: loyalty should no longer sit on the marketing expense sheet. Instead, it should function as infrastructure that drives sustained channel growth.

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The findings are based on insights from more than 1,000 brand leaders and over 8,000 channel partners, offering a snapshot of how India’s vast retail ecosystem is rethinking the rules of loyalty. In the process, the old promise of perks is giving way to a sharper question: what actually works?