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Shocking Statistics About Customer Loyalty

Author: ClaritysoftUploaded: 06/05/2018

Is Customer Retention Really That Important?

(Hint: Yes.) Seven surprising customer retention statistics show us why.

Higher Customer Retention = Increased Profitability

Earl Sasser of Harvard Business School worked with Bain & Company to find that a 5% increase in customer retention can increase a company’s profitability by 75%.

It Costs More to Get New Customers. In multiple studies, McKinsey & Company found that it costs 6 – 7 times more to acquire a new customer than to retain an existing one.

Your Future Depends On It. According to Gartner Group, 80% of future revenue will come from just 20% of existing customers.

What Drives Retention?

Service is the Number One Driver. Customers are 4 times more likely to buy from a competitor if they experience poor service than if they have a problem with products or pricing, according to Bain & Company.

Respond to Customer Questions Quickly. Oracle found that 50% of consumers give a brand only one week to respond to a question before they stop doing business with them.

Poor Service Drives Customers to Competitors. Oracle also found that 89% of consumers began doing business with a competitor following a poor customer experience.

How to Improve Retention

Want to retain more customers? Start by reading these other articles:

  • How to Hire the Right Candidates for your Customers
  • How to Provide Great Customer Service Training
  • How to Choose the Right Customer Relationship Management System

Benefits of Satisfied Customers
American Express found that customers are willing to spend 10% more on average for good customer service.