This is not just a Verizon practice, let alone a cell phone practice.  Home phone, internet, and cable generally do the same thing.  You get a certain rate for the first year, then after that the price increases.  Just go to DirecTV.com or dish network and the first thing you see is "29.99" and then in small little letters "for the first year" 

And loyalty rewards aren't really a thing.  Your local supermarket doesn't give you a gallon of milk cheaper because you have always shopped there.  Its a consumer product, they will always be battling for new customers so that is where the deal is.