How Zero-Party Data Will Shape Loyalty: Gen Z Will Share With Brands

In categories where people care deeply—travel, live events, dining—loyalty isn’t a gimmick; it’s a habit. Consumers still want the big moments, even as budgets feel tighter. The brands that win aren’t the loudest about AI or points—they’re the ones that quietly make the next choice easier, the next experience better.

If there’s one co-hort that understands the value of their data it is Gen Z. And if the value exchange is strong and they trust your brand (emphasis on brand trust) then they will be the first in the pool on sharing coveted zero party data with that trusted brand. Gen Z’s hope is brands will actually listen and enhance their experiences – “think training their algorithms.” You don’t have to be Einstein to train an algorithm. You do have to see the value of curating your own personalized digital journey.

I recently spoke with John Pedini, Principal Analyst at Forrester, who’s knee-deep in research on loyalty operations, financial modeling, and KPIs, along with an upcoming evaluation of platform providers. His vantage point cuts through the noise: most marketers are experimenting with AI, but day-to-day success still comes from getting the basics right—clear value exchange, relevant communications, and proof that the program moves the P&L.

AI Hype, Operator Reality

Providers are racing to bake AI into their platforms, which is what you’d expect. On the brand side, Pedini sees a more pragmatic posture: show ROI, improve personalization, simplify the member experience. Generative tools will matter—soon—but they only matter when they’re fed by permissioned insight and deployed where customers actually feel a difference. In prior Forbes reporting, I’ve argued that personalization works best when it’s transparent and purposeful; Pedini’s research underscores that operator reality.

“AI is only as good as the rules and context you feed it. For customers, the magic isn’t in the model — it’s in the moment when a brand anticipates their need without asking twice,” said Philip Alexander, CEO of AnswerMyQ.

The Untapped Advantage Of Zero-Party Data

Pedini is quick to remind marketers that behavioral data alone isn’t enough. First-party data—what people buy, when they buy it, and how much they spend—tells only part of the story. The more powerful signal is zero-party data: the information customers willingly volunteer about their preferences, needs, and context.

Smart programs use onboarding and ongoing touchpoints to ask simple, thoughtful questions—and then act on them immediately. e.l.f. Beauty Squad and My Purina stand out for making the exchange obvious: tell us what you want, and we’ll make the experience better right away. This isn’t about surveys; it’s about creating a dialogue. Brands that do this well build trust faster and generate more relevant offers without relying on guesswork.

Partnerships With Purpose & Impact

Partnerships have been a loyalty staple for decades, but the newest wave is more context-aware. When programs like Marriott Bonvoy and Starbucks connect memberships and recognize the shared customer while they’re actually on the road, the benefit lands in the moment, not in a quarterly statement. That’s where partnerships stop being a points treadmill and start feeling like service design.

Pricing Anxiety And The Agentic Future

Recent headlines stoked fears about customer-level dynamic pricing. Regardless of the specifics, the takeaway for marketers is simple: trust is fragile. Pedini’s forward look is compelling—consumers will soon bring their own AI agents that assemble itineraries around “non-negotiables” (the concert, the restaurant, the rivalry game) and flex on everything else (fly Thursday, stay just outside the city). When that happens at scale, the strategic question becomes: how do you make the must-include list?

A Fresh Playbook In The Wild

Pedini flagged Chipotle Rewards U, a student-authenticated extension calibrated to campus life. It’s segment-specific by design—game days, finals, and perks that feel earned, not generic—and it signals a broader shift: loyalty moving from linear discounts to contextual relevance. In my own coverage of travel and experience brands, the programs that grow faster are the ones that make the next decision feel obvious.

Three Watchouts For CMOs

Pedini distilled his advice into three clear cautions:

1. Don’t over-rely on inference. Behavioral data alone can mislead. Without context, a purchase might look like loyalty when it’s just a gift. Programs that rely only on clicks and transactions risk building personalization on shaky ground.
2. Design the give/get. Customers will often share preferences without a reward if the reason is clear. Where the data is essential—say, health details for a pet—testing light incentives makes sense. The exchange should feel fair, not forced.
3. Make personalization tangible. If the insights don’t lead to a better trip, meal, or moment, they don’t matter. Zero-party inputs and AI tools are valuable only when they shape experiences people can feel.

The Shift From Points To Participation

Pedini framed it well: the point of loyalty is a relationship. You don’t earn one by watching clicks; you earn it by being helpful at the right moments, again and again. If the near future belongs to consumers with their own AI co-pilots, brands will win by being the easiest—and most trusted—choice inside those journeys.

That’s the work. Not louder claims, but quieter usefulness. And over time, that’s what turns one-off purchases into repeat behavior.