Customer retention refers to strategies used by businesses to encourage repeat business and loyalty from their existing customer base.


Customer retention refers to the strategies and tactics businesses use to encourage repeat business and loyalty from their existing customer base. Instead of focusing solely on acquiring new customers, customer retention places equal or more emphasis on retaining the customers that a business already has. This term is a reflection of a company's ability to retain customers over some specified period.

Usage and Context

In the world of business, customer retention is a significant element to ensure success and growth. This term is used across various industries, including retail, telecommunications, food and beverage, and more. It's an essential metric for businesses that thrive on customer loyalty and repeat business, like subscription-based models or software as a service (SaaS) companies. Customer retention strategies include providing excellent customer service, implementing loyalty programs, offering regular discounts, and maintaining regular communication with customers.


What is the importance of customer retention?

Customer retention is important because it's much more cost-effective to keep existing customers than to acquire new ones. It also leads to customer loyalty, and loyal customers often become advocates for your brand, leading to new customer acquisition.

How is customer retention calculated?

Customer retention rate is calculated by dividing the number of customers at the end of a period by the number of customers at the start of the period, then subtracting the number of new customers acquired during that period. The result is then divided by the number of customers at the start of the period and multiplied by 100 to get a percentage.

Related Software

Some popular software tools that can help with customer retention include HubSpot, Salesforce, Zendesk, and Zoho CRM. These tools offer various features such as customer relationship management, email marketing, customer feedback, and analytics to help businesses retain their customers.


Some of the benefits of focusing on customer retention include increased profits, better customer feedback, lower marketing costs, and the opportunity to build strong relationships with your customers. Businesses that excel in customer retention also tend to have a better understanding of their customer base and can therefore offer more personalized and effective marketing strategies.


In conclusion, customer retention is a vital aspect of any successful business strategy. By focusing on keeping your existing customers happy, you can increase profits, reduce costs, and build a loyal customer base that will help your business grow.

Related Terms

CLV (Customer Lifetime Value)

CLV or Customer Lifetime Value is a prediction of the net profit attributed to the entire future relationship with a customer. It is used to guide marketing, sales, and customer service strategies.

CSAT (Customer Satisfaction)

CSAT (Customer Satisfaction) is a key performance indicator that measures the satisfaction level of customers with a company's products or services.

Customer Churn Analysis

Customer Churn Analysis is a business metric that calculates the number of customers who leave a product over a given period, divided by the remaining number of customers.

Customer Lifetime Value

Customer Lifetime Value (CLV) is a predictive analysis technique used to calculate the total net profit a company can make from any given customer.

Customer Lifetime Value Analysis

Customer Lifetime Value Analysis is a method used to predict the total value a company can derive from a customer throughout their relationship.

Customer Loyalty

Customer loyalty refers to the likelihood of repeat customers choosing a specific brand or company over its competitors. It is beneficial for business growth and profitability.

Customer Loyalty Analyst

A Customer Loyalty Analyst is a professional who interprets customer data to understand factors influencing loyalty, aiming to develop strategies that increase customer retention.

Customer Loyalty Consultant

A Customer Loyalty Consultant is a professional who helps businesses improve customer retention and satisfaction, ultimately increasing revenue.

Customer Loyalty Director

A Customer Loyalty Director is responsible for developing and implementing strategies to improve customer loyalty and retention.

Customer Loyalty Manager

A Customer Loyalty Manager is a professional who manages customer retention and loyalty strategies to ensure customer satisfaction and boost business profitability.

Customer Loyalty Specialist

A Customer Loyalty Specialist is a professional focused on maintaining and enhancing a company's relationship with its customers to increase customer satisfaction, retention, and loyalty.

Customer Loyalty Strategist

A Customer Loyalty Strategist is a professional who develops strategies to foster customer loyalty, leading to increased business profits and growth.

Customer Satisfaction Analyst

A Customer Satisfaction Analyst is a professional responsible for analyzing customer feedback to improve satisfaction levels.

Customer Satisfaction Coordinator

A Customer Satisfaction Coordinator is a professional who ensures customer satisfaction with a company's products or services.

Customer Satisfaction Director

A Customer Satisfaction Director is a high-level executive who oversees customer service activities, develops customer service policies, and measures customer satisfaction.

Customer Satisfaction Executive

A Customer Satisfaction Executive is responsible for ensuring outstanding service and support to customers, aiming to increase customer satisfaction, loyalty, and retention.

Customer Satisfaction Manager

A Customer Satisfaction Manager is a critical role in businesses, responsible for improving customer service and satisfaction.

Customer Satisfaction Metrics

Customer Satisfaction Metrics are quantitative measures used to assess the level of customer satisfaction with a company's products or services.

Customer Satisfaction Research Director

A Customer Satisfaction Research Director oversees research activities aimed at understanding customer satisfaction levels, helping businesses improve their customer relationship strategies.

Customer Satisfaction Researcher

A Customer Satisfaction Researcher is a professional who conducts research to understand and improve a company's customer satisfaction.

Customer Satisfaction Specialist

A Customer Satisfaction Specialist is a professional who ensures customer needs are met, handles queries, and works towards improving customer satisfaction.

Customer Satisfaction Strategist

A Customer Satisfaction Strategist is a professional who develops strategies to improve customer satisfaction, enhance customer experience, and drive business growth.

Customer Satisfaction Survey Analyst

A Customer Satisfaction Survey Analyst designs and implements surveys to gauge customer satisfaction. They analyze results to help companies improve.
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