70 Powerful Customer Retention Statistics You Need to Know in 2021

Elizaveta Pavlovskaya

Apr 16, 20216 min read
Customer retention statistics

The ground rule of any business should be to create a base of loyal customers that feed the company and stay long-term. By focusing on retaining, your business can save on costs and even boost its marketing by having these loyal customers recommend your brand to all of their friends and family. 

If your business still doesn’t have a steady customer retention strategy in place, we’ve made this list of customer retention statistics to showcase the benefits it can bring your business.

General Customer Retention Statistics

  1. 44% of businesses focus on customer acquisition, while only 18% focus on customer retention.
  2. 89% of companies say that excellent customer service plays a huge role in customer retention. 
  3. 76% of companies agree that customer lifetime value is an important concept in their organization. 
  4. However, only 42% of companies can accurately measure the lifetime value of their customers. 
  5. The probability of selling to an existing customer is between 60% and 70%.
  6. The probability of selling to a new customer is only between 5% to 20%. 
  7. Existing customers are 50% more likely to try your business’s new product. 
  8. Existing customers are also 31% more likely to spend more on their average order value with your business.
  9. The average, loyal customer spends 67% more in their 31st to 36th month with a brand than in their first six months of the relationship. 
  10. 55% of millennials claim to be more brand loyal today than 39% of consumers aged 35 and up.
  11. 44% of millennials say they are loyal to their favorite brands. 
  12. 77% of people agree that what makes them loyal to a brand is quality products. 

Online Channel Use for Customer Retention

  1. Paid search like Google Ads and PPC only makes up 2% of marketing efforts directed to customer retention. 
  2. Online display advertising is most popular for customer acquisition, and only 4% of marketers use it for retention. 
  3. 6% of marketers work on SEO efforts for customer retention. 
  4. A tactic that works better as a retention tactic for 22% of marketers is web retargeting. 
  5. Social media marketing is the go-to customer retention strategy for 28% of marketers. 
  6. 39% of marketers say mobile and web push notifications help trigger customers to come back again. 
  7. 44% use mobile apps as their main marketing method for customer retention. 
  8. 52% of marketers develop a strong email marketing strategy geared towards customer retention. 
  9. The majority of marketers (58%) use mobile messaging as their most powerful customer retention strategy. 

Effectiveness of Digital Marketing Tactics for Customer Retention

  1. As far as strategies that are proven to work the most for customer retention, email marketing is 56% more effective than any other method, making it the most effective approach. 
  2. Followed by email marketing is social media marketing, being 37% more effective for customer retention. 
  3. Content marketing has an effectiveness of 32% for customer retention.
  4. Referral marketing counts for 26% of effective retention digital marketing tactics. 
  5. Search engine optimization (SEO) has an effectiveness of 13%.
  6. Display advertising’s effectiveness is just below SEO, at 12%. 
  7. Mobile advertising only provides 8% effectiveness. 
  8. Paid search, video advertising, and affiliate marketing are the lowest scoring marketing tactics for customer retention, each with less than 7% effectiveness.

Loyalty Program Statistics

  1. 58% of customers belonging to a brand’s loyalty program buy from that brand at least once per month. 
  2. 57.4% of customers join loyalty programs to save money, while 37.5% do so to receive awards. 
  3. 64% of retailers say they connect best with customers through their loyalty programs. 
  4. 69% of customers choose their retailer based on where they can earn customer loyalty rewards and points. 
  5. 50% of customers change their habits just to get to a higher tier of a loyalty program they participate in. 
  6. 46% of customers agree to spend more after they join a loyalty program. 
  7. Royalty programs play a role in 76% of a customer’s relationship with a brand. 
  8. 83% of people say joining a loyalty program will keep them making purchases at that business. 
  9. 74% of people have made purchase decisions for travel based on travel rewards programs. 
  10. Restaurant loyalty programs increase visits by 35%. 
  11. 67% of customers enjoy getting surprise gifts from their loyalty programs and consider it a make or break factor. 

Customer Retention Challenges Statistics

  1. 61% of retail companies cite customer retention as their biggest challenge. 
  2. The average American company will lose 23% to 30% of its customer each year due to a lack of customer loyalty. 
  3. 9% of businesses lose customers to the competition when they don’t take customer retention seriously. 
  4. Since 2016, customer retention loss has risen by 37% due to poor customer service. 
  5. The cost of customers feeling like nobody is listening to them is a 75 billion dollar problem for industries around the U.S.

Customer Retention Behavior Statistics 

  1. 14% of customers leave because the business doesn’t know how to handle their complaints. 
  2. Customers who have their complaints resolved promptly have a purchase intention rate of 82%. 
  3. Those who have had their complaint resolved (for some time after they’ve complained) have a retention rate of 54%.
  4. Regardless of whether their complaint gets resolved or not, those who complain have an average retention rate of 19%.
  5. Customers who have major issues with a brand but don’t complain have a 9% retention rate. 
  6. 97% of customers say salespeople don’t ask enough about their needs. 
  7. On the other hand, 49% of customers say salespeople talk way too much.

Mobile App Retention Rates Statistics

  1. On average, 75% of mobile app users don’t return after the first day. 
  2. The average mobile app user retention rate in 2019 was 32%, a stark decrease from 38% the year before. 
  3. WeChat has the highest user retention rate out of every app in China, with as high as 98.3% in just seven days.
  4. Comic apps have an impressive 33.8% day one user retention, while the 30-day retention rate drops to 9.3%. 
  5. News apps manage to retain double-digit retention rates, with 13.33% still using the app after 30 days of installation. 
  6. Media and entertainment have an average of 43% retention rate in 30 days and a 24% retention rate in 90 days. 
  7. eCommerce/retail apps, on average, hold a 37% retention rate in 30 days and 18% in 90 days. 
  8. A travel and lifestyle mobile app’s retention rates are very similar to eCommerce apps, with 36% in 30 days and 18% in 90 days.
  9. Technology apps have a 33% customer retention rate in 30 days and 19% in 90 days. 
  10. The category with the poorest retention rate is gaming apps, with a 27% retention rate in 30 days and only 10% in 90 days. 

Average Customer Retention Rates by Industry 

  1. Retail holds an average of 63% customer retention rate as consumers are bombarded with options from competitors.
  2. Banks have a high retention rate (75%). Most people stay with the same bank for decades and only switch due to life circumstances or relocation. 
  3. Telecom companies hold a 78% retention rate and focus on customer loyalty and rewards programs. 
  4. IT services, which focus on client success, have an 81% customer retention rate.
  5. The insurance industry has an 83% retention rate, as customers usually stick to one insurer. 
  6. Companies that offer professional services tend to have a close relationship with their customers, hence why they have an 83% retention rate, one of the highest of all industries.
  7. The media industry targets large volumes of customers and little personalization and has an average of 84% retention rate.

Is Customer Retention the Key to Success?

It’s no secret that most established businesses rely heavily on their existing customer base for feeding the company and making new sales. Did you know an average of 68% of new customers come from current customers? 

That’s why many companies are putting more focus than ever on their customer retention strategies, and more specifically, customer loyalty programs. Two-thirds of companies have an entire function dedicated to customer loyalty and retention, while 13% plan to have one soon. 

Since the cost of getting a new customer is an estimated five to ten times more than keeping an old one, nurturing loyal customers is a powerful strategy that helps businesses grow. 

After reading this list of customer retention statistics, it’s time to plan your customer retention strategy. Part of this strategy will be knowing how to respond to Google reviews. Remember that focusing on customer service and retention instead of acquisition is key to growing a base of loyal customers who will become mini brand ambassadors and keep buying from your business. 

Organic traffic from search engines is the biggest source of traffic for your website. In this on-page SEO guide, you'll learn why quality on-page content is important for both your target audience and search engines.

We got our stats from Statista Premium and the following sources:

Invesp Altfeldink HMI Geckoboard Statista Profitwell Loyalty360

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I‘ve traveled a long way with Semrush, guided by interest in research and analytics. Four years ago I started with localization but soon fell in love with SEO. For now I keep learning from the best marketers from all over the world.