Customer retention refers to retaining existing customers. The goal of customer retention is to ensure existing customers make repeat purchases, are satisfied with a company’s services, and do not defect to a competitor.
When a customer becomes dissatisfied with a product or service, he/she may either leave or stay. If a happy customer stays, he/she is said to be retained. On the other hand, if a customer leaves, he/she is not counted as being retained.
Retaining customers is vital for any business. A study on customer retention rates conducted by McKinsey & Company found that 70 percent of customers would recommend a company based on its ability to retain them.
Longtime customers are more willing to branch out and try other products from a company they trust and from sister companies. Higher customer satisfaction increases your profits across all product lines.
If you want to learn more about driving Customer Retention, contact the PSFK research team.