These Crucial Customer Retention Metrics Is All You Need

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BY Chris Loomis

“I love losing clients”, said no one ever. 

Who wants to lose customers and their business? You bet no one does! All brands and business owners will do everything to keep their customers and their businesses running. This includes optimizing your website and social media platforms to ensure customer loyalty and more. 

Customer retention is more crucial, especially for B2B companies. Unfortunately, customer retention is not much of a priority for marketers unlike when finding ways to gain new customers or additional sales. A lot of business owners do not realize that higher customer retention means higher profits and overall business success. 

In other words, you do not take your customers for granted. They are the life and blood of your business. Without customers purchasing from you, your business will die. That is why you should also find ways to keep them and get them to stay with you in the long run. 


Measuring customer retention 

This refers to the process of documenting how the business is doing in terms of retaining its customers and increasing its revenue. Measuring customer retention is done by referring to customer retention metrics. By using these metrics, companies are able to determine whether they are meeting their clients’ needs and whether their strategies are effective enough. 

Customer service, marketing, and sales departments will find customer retention data very useful. However, calculating customer retention data can take time. Some of the most important metrics to take note of when measuring customer retention include the following: 

  • Customer lifetime value 
  • Loyal customer rate 
  • Time between purchases 
  • Repeat purchase ratio
  • Customer and revenue churn 
  • Product return rate


Customer retention metrics to remember 

Here are the customer retention metrics every business owner and marketer should know. The data you get from here will help provide insights into customers’ buying behavior, what makes them happy or not in dealing with businesses and improving your business in general. 


Customer and revenue churn 

The former refers to the time when customers stop dealing with your business. One example is when a customer unsubscribes to a newsletter, unfollows you on your social media page, or not renew their paid subscriptions. 

Meanwhile, the revenue churn rate refers to the decrease in revenue percentage coming from current customers. Some examples include downgrading a subscription plan, canceling an order, or terminating a business partnership. The higher the churn rate for these two, the more you should do something about it and make sure not to let your remaining customers slip away. 


Customer revenue growth rate

This is as important to your business as well. The higher the rate, the more you are doing an amazing job in retaining your customers. A stagnant growth rate means you need to do something about it and improve how you capitalize on current customers. 


Repeat purchase ratio 

This one refers to the percentage of customers who bought from your business again. Basically, repeat purchase is a major sign of customer loyalty. This includes the usual product purchase, contract renewals, and renewing premium subscriptions. This will also determine which demographic makes the most purchases so you can tweak it accordingly and get more purchases!


These are only some of the many metrics to consider. A digital marketer in Franklin TN will also help business owners improve their websites and business’ performance in general. Contact one today!

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