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How Do the Best Companies Retain Customers?

by Valentin Radu
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Customer retention is one of the most important areas of CX to acquire as a skill – it can help you increase sales while spending less money on advertising. It’s not an easy task and it compiles a multitude of strategies, but it’s definitely worth it in the long run.

Customer retention is one of the most important areas of marketing to acquire as a skill – it can help you increase sales while spending less money on advertising. It’s not an easy task and it compiles a multitude of strategies, but it’s definitely worth it in the long run.

But first of all, what is customer retention?

Customer retention is a marketing strategy – it involves keeping existing customers interested and involved with the brand, so they will return to do business, even after their initial purchase.

It’s an essential component of a complete customer lifecycle – it helps bring clients back into the purchase funnel after they’ve completed their initial buyer’s journey.

A customer retention model includes client retention ideas and customer retention tips, to keep the audience loyal to the brand – keeping the company on top of its game, whilst differentiating from the competition.

Why is customer retention relevant?

We’ve discussed more about the importance of customer retention in our previous article, Customer retention strategy. As a quick reminder, here are some key data to take into consideration, when assessing the importance of customer retention:

  • The probability of selling to an existing customer is 60-70%, as opposed to 5-20% to acquire new customers;
  • Existing customers are 50% more likely to try out a new product and they spend, on average, 31% more than a new customer;
  • Retaining customers costs five times less than acquiring new ones – conversion rates are pricier than customer retention strategies;
  • There is a 70% chance of selling to people recommended by existing customers;
  • US companies lose about $137 billion per year due to consumer switching.

Now that we understand the importance of customer retention in the overall success of the company, let’s dive in deeper and see what are some common customer retention best practices – general rules of thumb that will help any business increase their customer retention rate.

Best practices for improving retention

Get to know your customers

The first and most important step of any customer retention model: know your audience. The expectations, standards, and flexibility of customers will vary a lot, depending on several geographic, demographic and psychographic variables.

Conduct market research asks for feedback and objectively asses what works and what doesn’t in the buying process. Deeply understand your customer’s behavior and expectations, and make sure to deliver on that promise every single time.

Remember – treating clients as they expect is the first step to customer retention.

Share your audience’s values

It’s no longer a matter of choosing between two products and calling it a day. In today’s society, there is a very competitive market that is offering a lot of excellent products and services – this is no longer the status quo. You really need to take your brand to the next level – resonate with your audience, make them feel connected to you in a more meaningful way.

Most companies nowadays have a CSR department and dedicated marketing consultants specifically for that reason. People want to feel like their purchasing behavior is not only relating to them but that it is a statement on how they want to live and influence the world around them – creating a community around your brand, one that shares core values, is the key to customer loyalty.

Always engage with your customers

Communication is key – in any area of life, be it personal or professional. One of the best customer retention tips is to always keep your customers engaged – during good times, and even during bad times.

The best example of what not to do is the Germanwings Flight 4U9525 case. It goes to show that no matter what happens and whose fault it really is, the public needs to be constantly informed, engaged, and feel like they can rely on you in any situation regarding the company.

Whether you choose social media, satisfaction surveys, or any other means of communication, make sure customer contact is one of your top priorities.

Embrace new technology

A top contender for customer retention best practices is embracing and implementing new technology. This can range from a properly created website to a technological innovation designed specifically for your customers. When your competitors are advancing in this field, they’re setting expectations for your customers, as well!

Amazon has earned its top spot as an e-commerce leader. By offering features that other stores do not, Amazon is retaining its customers through customer excellence. Amazon Prime changed consumer expectations concerning free and fast shipping, as well as various other tech innovations provided by the company.

Educate your customers

You can engage with your customers and also create a bond with them through education. This proves to your audience that you really care about their wellbeing – by investing in their long-term success, with no profit guarantee.

Education can be provided through valuable articles, videos, workshops, events and many more. The key is to incorporate whatever it is you are selling with accurate information for the public. Together, they will not only help you promote your product, but also retain the loyalty of the customers.

Offer a personalized experience using RFM segmentation

RFM segmentation refers to Recency, Frequency and Monetary value. Each one of these three corresponds to one key customer trait. Their metrics are valuable indicators of a customer’s behavior – frequency and monetary value affect a customer’s lifetime value, whereas recency affects retention.

This powerful tool allows marketers to communicate with specific groups of customers – using communication strategies that are much more relevant and customized to their particular behavior. This generates a higher rate of customer engagement, increased loyalty, and customer lifetime value.

RFM segmentation is preferred by many over other methods because it is:

  • Objective – by using numerical scales, it yields concise and highly informative depictions of customers;
  • Easy to use – it doesn’t require data scientists or complicated software;
  • Intuitive – the results are easily understandable and interpretable.

Improve your business by using a customer intelligence platform

Using a customer intelligence platform can really help your business evolve – a great resource for this is Reveal. Reveal can help you identify harmful products and brands. Moreover, it tracks the NPS (Net Promoter Score) on every acquisition. Last but not least, it follows the retention rate over time, giving you concrete feedback on your retention efforts.

Now that we know what customer retention is, why it is so important and what are some key principles to achieve customer retention, let’s look at some real-life case studies. Here are a few customer retention strategies from the top players in the game.

Customer retention examples


Walmart is the world’s largest company by revenue, and this achievement cannot be explained solely by the low prices they provide – customer retention plays a big role in their marketing strategy. Although the brand is famous for its brick-and-mortar stores, they have managed to create customer retention by bringing the company in the digital age.

Some of the innovations brought by Walmart include:

  • The Walmart Pay app, an easy and fast way to pay for your groceries in no time – it has been reported that repeat use drove 80% of transactions in the app;
  • Deals customized only for the app users – providing 70% of its online traffic on Black Friday;
  • Enhanced check-out options like the Scan & Go feature.


There is no bigger and better example of customer retention done right like Apple. When people are willing to sleep in tents, in front of your store, for an entire night just to be the first to get their hands on your product, you know you’re doing something right.

Apple is no longer a provider of gadgets, it’s a lifestyle brand. Every celebrity, influencer and big name out there is using Apple products, either for business or personal inquiries. From laptops, phones, tablets and earphones, the brand is iconic in every way.

Much of the success attributed to Apple is the way they treat their customers. The stores are designed around creating an amazing customer experience, from the minimalistic displays to the Genius Bar. Truly, you do feel a million bucks when interacting with the company.


Our sense of belonging is one of the fundamental needs we have as humans – and it even applies to our desire to feel seen and respected by the companies we support. This is where Coca-Cola had a brilliant idea with its “Share a Coke” campaign. 

The marketing effort earned the company a 2% increase in soft-drink sales, making it a huge success worldwide. The secret behind the campaign was the message behind it: you matter. Your name matters and we, as a brand, feel connected to you on a deep, personal level.

Moreover, this acknowledgment of the audience incentivized them to share pictures of the product online (more than 500,000 times, to be precise).


Knowing what people want is not enough – a bunch of data scattered around in an Excel spreadsheet will not help you make better marketing decisions. In order to create customer retention, you really need to understand the why the how and the when of your audience.

Nestlé Waters North America understands this concept very well, so they have invested in a digital Consumer Engagement Center – it’s a place where they manage their online and offline brand data. The concept is targeted towards social listening and analytics, in order to better understand their audience on a profound level.

That includes, but is not limited to:

  • Managing the brand’s online communities;
  • Analyzing customer experiences, data and behavior;
  • Using collected data to interact with customers through targeted messages.


Google provides a wide range of products and services, like Gmail, Google Maps, Google+, Google Analytics and many more. It is a long-lasting leader in its field, with its technological innovations and customer loyalty.

The company understands technology very well and is aware of the importance of staying up to date. Its advancements are a top priority and so customer retention is fairly easy to them – provide good products and services, addressed particularly to their needs, stay on top of your game, increase customer satisfaction.

In conclusion

As a continuation of our previous articles on customer retention, today we looked at some real-life customer retention examples done right. We first defined the concept and understood some of the most common customer retention best practices & client retention ideas. 

There is a lot to learn from the big players of the game – as much as innovation is rewarded and encouraged in the marketing field, there is really no need to reinvent the wheel every time we try to sell a product and a service. By using and implementing their examples, you can definitely expect increased customer retention rates.

Customer retention is about investing in customer relationship management – making your audience feel valued and, ultimately, making smarter business decisions when it comes to your advertising efforts.

post authorValentin Radu

Valentin Radu, I am an entrepreneur, data-driven marketer, CRO expert, international speaker, father, husband, and pet guardian. I have spoken at over 100 International events over the last seven years, including DMEXCO, Mobile Web Congress, SMXL, Growth Marketing Conference, MeetMagento, Conversion World, Webit, WebSummit, SemDays, Gpec, HowToWeb, IceeFest, Ecommerce Brazil, LMFA Singapore, TechinAsia, etc.

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