Customer retention often comes second to customer acquisition in business, mostly due to the fact that there’s nothing more satisfying than winning over customers and generating business off new people. However, it’s actually much more cost effective and beneficial for businesses to focus most of their attention towards creating customer loyalty and improving customer retention. After all, once you get your customers coming back to shop with you every time, that’s when you’ll see your revenue take off.

Without working on your customer loyalty and putting together some sort of retention plan, you’re likely gaining and losing customers at a similar rate and not actually growing your business

Just to throw a few stats out there in case you have any doubts about the benefits of improving your customer retention, acquiring new customers costs 5 times more than retaining one, and not only that but increasing your retention rates by just 5% can lead to a profit increase of 25-90%.

So now that you understand the importance, how do you actually go about building relationships with your customers and preventing them from slipping through your fingers? Below are our top tips…

Figure out why your customers are actually leaving

First things first, you need to understand why your existing customers are choosing to leave. What is or isn’t happening that’s affecting your customer retention rates and failing to create any sense of loyalty towards your organisation.  

If you can work out the main reasons for dips in customer retention, you can take steps to resolve these issues… simple!

But how do you find out why people are leaving I hear you ask? Well, one way is to get some feedback from your ‘ex-customers’ to find out what their reasons were for leaving. Asking for customer feedback is a great way to find out if there are any complaints or areas you can improve on to encourage repeat purchases and customer loyalty.

Improve the experience for your customers

It doesn’t come as a surprise that research shows customer experience plays a big role in repeat purchases and customer retention rates, with a study showing that 82% of customers leave a company because of poor customer experience.

There are two aspects of improving customer experience and overall satisfaction. The first includes acting on any feedback you receive, this helps to show your customers that you value their opinion and are willing to make the changes that will benefit them.

The second aspect is working to improve specific areas of your business that provide additional value to customers and influence, not just customer retention, but customer loyalty as well! A great way of achieving this is by implementing a customer loyalty program. Loyalty programs are great for adding value to your customers and giving them another reason to choose you over your competitors. Additionally, it encourages existing customers to continue to shop with your brand in order to gain the rewards of doing so.

When it comes to improving customer experience, one of the main things is making your support team easily accessible. You could do this through live chat functions, a customer service phone number, emails or even through social media. This way, whenever your customers need to get in touch, there’s always someone to help them out. This certainly goes a long way to ensuring better customer relationships.

If your customers have a great experience with your support staff, there’s a really good chance that they’ll let others know about it, whether it’s through reviews on social media or word of mouth. This can go a long way to increasing brand loyalty and attracting new customers. Of course, the opposite is also true. If customers have a bad experience, they’ll most likely tell others about it. Negative press can have a huge impact on brand loyalty and repeat purchases, along with potentially missing out on new customers.

Lastly, you’ll want to consider the overall usability of your product or service. Luckily you can use any customer feedback to improve the experience for your customers and increase customer retention.

Improve Customer Relationships

If customers feel as though a company doesn’t particularly care about them or are providing good service, they probably won’t stick around for long.

We’ve already talked about how providing great customer service and acting on any feedback can really help with your customer retention. But there are other things you can do to make your customers feel valued and build a relationship with them, and that is through the use of loyalty programmes as we mentioned briefly above.

Providing some perks for customers who have stayed with and remained loyal to you for an extended period of time is one of the most effective customer retention strategies. Customer loyalty programs can encourage repeat purchases and keep your customer retention rates healthy, in fact, loyalty programmes can lead to 54% of customers increasing the amount of business they do with you.

Another great way of improving customer relationships is through building a community, this can be done by hosting an event, or simply setting up a Facebook Group for your customers.

So there you have it, a few of our top tips and some really effective ways of improving your customer retention.


Perx Rewards provides a suite of reward based marketing tools which are designed to increase your customer retention. If you’re interested in finding out more about how PERX can help your business, contact us at or call 01254 878 956.