Two Free Stamps Lifted Loyalty Completion From 19% to 34%.

In a field experiment with 300 car-wash customers, researchers Joseph Nunes and Xavier Drèze handed out two loyalty cards that required exactly the same customer effort.

One promised a free wash after eight stamps.

The other required ten stamps—but arrived with two “bonus” stamps already filled in.

Both groups still needed eight paid washes.

The outcome was not close: 19% of customers with the ordinary card completed it, compared with 34% of those who appeared to start 20% of the way toward the goal. Nothing about the reward improved. Nothing became cheaper.

The marketing changed one thing: the customer no longer felt they were starting from zero. (Nunes & Drèze paper, SSRN)

Same Reward, Different Starting Point

Nunes and Drèze called the phenomenon the “endowed progress effect.” Their argument is simple: people may persist longer when a goal feels already underway rather than untouched. (Journal of Consumer Research)

That matters because most loyalty programs are designed from the company’s arithmetic.

Buy eight, get one free. Spend $500, earn a credit. Complete five referrals, unlock a reward. The business sees the distance remaining. The customer also sees the psychological starting point.

In the car-wash experiment, the two-stamp advantage was artificial.

The ten-stamp card did not reduce the number of paid visits required. Yet customers holding it redeemed at a higher rate and returned more quickly.

The researchers reported an average 2.9 fewer days between visits for the endowed group. As customers accumulated stamps, the interval between visits also shortened. (Nunes & Drèze paper, SSRN)

The lesson is not “give away two points.” It is that visible progress can carry motivational value.

Why Starting Feels Different

A blank loyalty card quietly asks a customer to begin a project. A card with visible progress tells a different story: you have already begun; now finish.

That reframing changes how the remaining effort is interpreted.

Nunes and Drèze found that the effect depended on perceived progress toward completion, not simply on fear of wasting free stamps. They also found that the size and framing of the endowment mattered.

An arbitrary head start is not magic.

Customers have to perceive it as meaningful progress toward a real goal. (Journal of Consumer Research)

This creates a useful distinction for modern marketing.

A signup bonus and a discount are not psychologically identical.

A discount reduces economic cost. Endowed progress changes perceived distance.

One can make the transaction cheaper; the other can make the goal feel closer.

For a subscription business, that might mean onboarding that visibly begins with one completed milestone.

For a referral program, it could mean credit for an action the customer has already taken.

For a course or membership, it could mean recognizing completed setup work rather than presenting every new member with an empty progress bar.

Customers Accelerate Near the Finish Line

A separate 2006 study by Ran Kivetz, Oleg Urminsky and Yuhuang Zheng examined what happens as people approach rewards.

Using data from a real café loyalty program, online reward tasks and field experiments, the researchers found a goal-gradient effect: effort increased as the reward came closer. (Journal of Marketing Research)

In the café data, customers purchased coffee more frequently as they neared a free coffee.

In another experiment, people given a 12-stamp card with two pre-existing bonus stamps completed the same ten required purchases faster than people given a regular ten-stamp card.

Columbia Business School reports median completion times of 10 days versus 15 days. (Columbia Business School)

This is why the final stretch of a loyalty program should not be treated like the first.

A customer at eight of ten purchases is in a different motivational state from a customer at zero of ten. Sending both people the same reminder wastes information the program already has.

The commercial opportunity is not simply more messaging. It is better timing.

The closer a customer gets to a meaningful reward, the more useful a clear progress reminder may become.

Where the Principle Works—and Where It Breaks

Endowed progress is most useful when the underlying goal is real, understandable and worth completing. It can improve the framing of a legitimate offer; it cannot rescue a weak reward.

There is also a trust boundary. “You already have 2 of 10” works when those two units are genuinely granted.

Inventing progress that later disappears, changing the finish line, or making the reward harder to redeem turns motivational design into manipulation.

Businesses should also resist copying the car-wash percentages as a forecast.

The 19% and 34% results came from one field setting with a specific reward, purchase cycle and customer population.

The research establishes a mechanism worth testing, not a universal conversion benchmark.

In digital programs, a progress bar can be more visible than a paper stamp card, but visibility does not guarantee motivation.

Customers still need to understand the goal, value the reward and believe the progress is legitimate.

Measure Progress, Not Just Redemption

A useful loyalty test can separate the reward from the framing.

Keep the required customer effort and final reward identical.

Give one group a conventional zero-start experience and another a legitimate head start. Then measure more than final redemption.

Track the percentage who take the next action, time between actions, completion rate, time to completion and what happens after the reward is earned.

The goal-gradient research found that stronger acceleration toward a reward predicted faster reengagement afterward, which makes retention—not just redemption—the more interesting business question. (Journal of Marketing Research)

For smaller businesses, this can be tested without sophisticated loyalty software.

A salon package, café card, paid membership, referral offer or onboarding sequence can all make progress visible.

What matters is preserving the economics while changing the customer’s perceived starting point.

The enduring idea is almost embarrassingly small: zero is not always a neutral place to begin.

When customers can see credible progress, the same destination can feel closer—and that can change what they do next.