Breakage

Breakage is the share of issued loyalty value, points, credits or offers, that members never redeem, so the cost is accrued but never actually paid out.

A degree of breakage helps program economics, but high breakage usually signals offers that are irrelevant, hard to find or badly timed. The healthier goal is redemption that drives incremental visits, which is where relevance and timing matter. Measuring breakage against incremental lift, rather than in isolation, keeps a program honest.