Customer Loyalty Was Once Measured in Green Stamps. And the More You Shopped, the Bigger the Rewards

The idea of rewarding loyal customers has existed for millennia. In ancient Egypt, merchants offered their regulars tokens that could be redeemed for staples like bread or beer. In the late 1700s, one New England merchant gave customers copper tokens to exchange for merchandise. But the first large-scale loyalty program didn’t appear until the late 19th century.

In 1891, traveling salesman Thomas Sperry came upon an intriguing incentive program in a Milwaukee department store, which issued stamps with each purchase that customers could later redeem for merchandise. Sperry saw a chance to make a business out of printing these stamps and selling them to retailers. 

With investor Shelley Byron Hutchinson, in 1896 Sperry founded the Sperry & Hutchinson Company, known as S&H, which issued its first green-and-white paper stamps at stores in Jackson, Michigan, near Hutchinson’s hometown of Ypsilanti. For every 10 cents spent at participating stores, customers received a stamp worth 10 points. Once you’d acquired enough stamps to fill an S&H Green Stamps booklet, you redeemed them at an S&H showroom for anything from furniture to silverware.

The program was a fast success with regional dry goods stores, and soon with department stores and grocers. By its second year, S&H had expanded to 67 cities, and Sperry and Hutchinson began opening more showrooms (or redemption centers), where customers presented their stamps for merchandise: One booklet could get you a porcelain lamp, while six booklets could get you a bicycle. In the early 1900s, S&H launched its catalog, which became one of the most widely circulated publications in the country: By 1964, S&H was distributing a reported 32 million copies a year, as customers redeemed more than a billion stamps weekly. 

That decade saw Green Stamps’ zenith: The United States had approximately 800 S&H redemption centers and more than 100,000 participating businesses. Andy Warhol immortalized the stamps in a 1962 silkscreen, now in the collection at the Museum of Modern Art in New York. But in the mid-1970s, as the U.S. economy stagnated, S&H began to decline. By the late 1980s, fewer than 100 retailers were still participating. And as many stores chose to cut out the middleman by offering their own rewards programs, S&H Green Stamps never quite recovered. 

In 1981, the founding families sold S&H, but in 1999, one of Sperry’s great-grandsons repurchased it. The stamps went digital the following year, rebranded as “Greenpoints.” But this and other rebrands failed to recapture the magic: S&H was obsolete thanks to the phenomenon it had created. Many retailers now offer rewards programs, which are bigger than ever: In 2024, they accounted for $12 billion in economic activity.