Are you a business and want to learn about customer retention so you’ve decided to look up some customer retention statistics?
Well, even if you’re just interested in learning about customer retention, keep reading as I dive into this topic and tell you everything I’ve discovered about customer retention statistics!
Customer Retention Statistics In 2023
- 75% of people go back to a company if they offer rewards
- 82% of companies think retention is cheaper than acquisition
- 65% of all business comes from existing customers
- 56% of consumers have loyalty to brands that just get them
- If a company increases retention by 5% then it leads to a profit boost of 25% to 95%
- 89% of companies think great customer service leads to customer retention
- Personalization strategies are a way 58% of businesses maintain customer retention
- 76% of all companies think the lifetime value of a customer is important for their organization
- 18% of businesses focus on customer retention
- 44% of companies focus on customer acquisition
Do you want to know other important customer retention statistics and have other related questions? If so, keep on reading because I’ve got even more to share with you!
1. 75% Of People Will Go Back to a Company If They Offer Rewards
If a company offers loyalty rewards, 75% will go back to them, so it’s a great way to increase customer retention and get more people to visit your business.
2. 82% Of Companies Believe Retention Is Cheaper Than Acquisition
One interesting customer retention statistic is that 82% of businesses believe retention is cheaper than acquisition, which means keeping a customer coming back is much cheaper.
3. 65% Of Business Comes From Existing Customers
Did you know that 65% of business comes from existing customers? That is a very high number and shows the importance of customer retention.
4. 56% Of Customers Are Loyal to a Brand That Gets Them
If a person feels like a brand gets them and knows them, it leads to 56% of customers being loyal to a brand, which shows why companies need to focus on getting to know the consumer.
5. An Increase in Retention of 5% Can Lead to up to a 95% Profit Boost
If a business just increases its retention rate by 5% it can lead to a 20% to 95% boost in profits!
6. 89% Of Companies Think Great Customer Service Leads to Customer Retention
Providing great customer service is important in customer retention with more than 89% of companies believing this is a main contributing factor to retention.
7. 58% Of All Companies Implement Personalization Strategies to Maintain Customer Retention
Personalization strategies are important to maintain customer retention and 58% of all companies implement this strategy to keep their customers.
8. 76% Of Companies Believe a Customer’s Lifetime Value Is Important for Their Organization
76% of all companies believe the lifetime value of the company is important for the business, which is a high number and shows that businesses value customer retention.
9. Only 18% of Businesses Focus on Customer Retention
Customer retention is very important but only 18% of businesses focus on that aspect, which is a shockingly low number and a trend we hope doesn’t continue.
10. 44% Of Companies Focus on Customer Acquisition
Instead of focusing on customer retention, 44% of companies focus on customer acquisition instead, which is a statistic we didn’t think that we’d see.
11. 55% Of Millennials Are Brand Loyal
Millennials are known for being pretty finicky, but about 55% of millennials are brand loyal, which is a high number when you think about it.
12. Only 39% of People Over 35 Are Brand Loyal
While millennials might be pretty brand loyal, those over the age of 35 aren’t quite as loyal since only 39% over age 35 consider themselves to be brand loyal.
However, this isn’t a bad thing because brand loyalty can lead to you missing out on other great brands that offer quality and loyalty programs.
14. Selling to a New Customer Probability Is Lower Than 20%
It can be difficult to sell to a new customer and a survey showed that the probability is less than 20% that a business can sell a product to a new customer.
15. A Company Has a 60% to 70% Chance of Selling to an Existing Customer
Existing customers are important to a business and statistics show that a business has odds of 60% to 70% to sell a product to an existing customer.
Therefore, customer retention can help businesses sell products, even new products, which can boost profits.
16. 77% Of People Believe Customer Loyalty Comes From a Quality Product
Quality products can lead to high customer retention rates since 77% of people think that brand loyalty comes from offering high-quality products.
17. Customer Retention Less Than 20% in Most Industries
One shocking customer retention statistic we were surprised to learn about was that in most industries, the customer retention rates are below 20%!
18. 90% Of People Believe a Crisis Can Show the Trustworthiness of a Business
Did you know that 90% of people believe that a crisis can show how trustworthy a business is? If a company handles a crisis honestly and with integrity, it can lead to customer retention.
19. Same-Day Delivery Can Get 40% of People to Pay More
Customer retention can be achieved by offering same-day delivery, which can get 40% of people to pay more to receive the product quicker, which boosts profits for the company.
Additionally, if a company offers same-day delivery, it leads to a more positive customer experience.
20. Companies Lose Over $1.6 Trillion When a Customer Chooses Another Brand
When someone takes their business elsewhere and switches to a different brand, it will lead to a company losing out on $1.6 trillion overall, which is a surprising statistic!
Therefore, it shows that customer retention is vital to continue making money and one customer disassociating from a brand can really damage profits.
21. One Bad Experience Leads to 32% of People to Stop Doing Business With That Company
32% of people will not continue to do business with a company if they have even just one bad experience, which is a high number considering that sometimes people just have bad days.
Furthermore, since businesses are having a hard time hiring workers, the experiences are more likely to be worse compared to just a few years ago.
69% Of People Shop Where Customer Service Is Consistent
One way to maintain customer retention is to provide consistent quality customer service since 69% would shop where the customer service has been consistent.
22. 77% Would Recommend a Business to a Friend If the Experience Was Positive
If someone has a positive experience with a business or brand, they are 77% more likely to recommend the business to a friend than if the experience was bad.
However, we are surprised that a positive experience doesn’t lead to even more people recommending the brand or business to friends.
23. 48% Say They Generally Have Trust in a Company
Only 48% of people say that they have a general trust in a company, which is both good and bad considering you shouldn’t blindly trust a business but leads to you missing out on opportunities.
What Are the 7 Customer Retention Strategies?
The seven customer retention strategies that a business can implement to boost customer retention rates include the following:
- Leverage the customer data
- Create a loyalty program
- Measure the lifetime value of a customer
- Build long-term relationships through trust
- Use gamification to delight the customer
- Personalize the communications and offers
- Use marketing automation to engage customers
What Is a Good Customer Retention Rate Increase?
A business should strive for a retention rate increase of about 5% since that can increase your profits substantially by up to 95%, which is huge!
Is Customer Retention More Powerful Than Customer Satisfaction?
Customer retention is more powerful than customer satisfaction because over 60% of the revenues for a company in the future will be from those existing customers.
Also, just increasing customer retention by 2% can lead to a 10% reduction in operating costs and lead to higher revenue and profitability.
However, customer retention comes from customer satisfaction, so if your customers are not satisfied then they likely aren’t going to be a repeat customer and you’ll lose their business.
Is It Cheaper to Keep Old Customers or Get New Customers?
It’s a lot cheaper to keep an old customer since getting a new customer can cost you 5 to 25 times what it would cost to keep an old customer.
Therefore, trying to keep your current customers happy is a much more financially-savvy move than spending time and resources trying to lure in new customers.
That being said, it can depend on which industry you’re in, as it may not always be cheaper to keep an existing customer over getting a new customer.
There are multiple customer retention statistics that we found fascinating, such as that if a company offers rewards or a loyalty program, 75% of people will go back to that brand.
Additionally, if customers feel like a brand gets them then 56% of people will have loyalty to that brand, and 65% of all business comes from existing customers.