Significance of Customer Retention for a Business
Posted: Thu Feb 13, 2025 9:27 am
Nowadays, customer retention is very important for eCommerce businesses because of the multiple competitors in the market. The need for a customer retention programme is greater than ever, as a well-planned and executed strategy has the potential to retain customers and encourage them to make more purchases. There is a simple formula used by businesses to identify their customer retention rate, which is:
(Number of customers at the end of the period – the number of new customers acquired during the same period) / number of customers at the start of the period x 100
The average customer retention rate generally ranges between 30% to 40% for eCommerce businesses.
Customer retention is significant for eCommerce businesses for various japan phone number list reasons. It impacts several aspects of the business directly. Some of these are explained below to showcase the significance of customer retention in a business:
Customer retention will help you get numerous repeat customers who want to try new products because they already trust your brand.
Businesses can save on budget if they convert existing customers into repeat buyers. This is because approaching new customers, spending on ads, and marketing are more expensive.
Customer retention makes existing customers talk about your brand and products in front of their friends and family. This mouth-to-mouth publicity is the most eficient and best way to do marketing for free.
The recurring customers also help you build your business better, as they provide loyal feedback. you can use this to construct your business better.
Customer Retention Metrics That Matter
1) Repeat Customer Rate (RPR)
Repeat customer rate refers to the percentage of customers willing to make a second purchase from your store. This metric helps you get a clear perspective of how your strategy is performing. Here is how you measure repeat customer rate.
(Number of customers at the end of the period – the number of new customers acquired during the same period) / number of customers at the start of the period x 100
The average customer retention rate generally ranges between 30% to 40% for eCommerce businesses.
Customer retention is significant for eCommerce businesses for various japan phone number list reasons. It impacts several aspects of the business directly. Some of these are explained below to showcase the significance of customer retention in a business:
Customer retention will help you get numerous repeat customers who want to try new products because they already trust your brand.
Businesses can save on budget if they convert existing customers into repeat buyers. This is because approaching new customers, spending on ads, and marketing are more expensive.
Customer retention makes existing customers talk about your brand and products in front of their friends and family. This mouth-to-mouth publicity is the most eficient and best way to do marketing for free.
The recurring customers also help you build your business better, as they provide loyal feedback. you can use this to construct your business better.
Customer Retention Metrics That Matter
1) Repeat Customer Rate (RPR)
Repeat customer rate refers to the percentage of customers willing to make a second purchase from your store. This metric helps you get a clear perspective of how your strategy is performing. Here is how you measure repeat customer rate.