Why is Customer Retention Important?

In this clip from the third video in Resilience: An Elearning Series For Ecommerce Brands In 2021, Allison shows you why one-and-done customers are a big problem for businesses of all kinds. You'll learn why customers who come back to buy from your business repeatedly are good for your brand from both an economic perspective and a customer data perspective.

Going beyond the obvious

When asked why customer retention is important, people will often come back with the most obvious, top-of-mind answers. "It's obviously good to have customers back over and over again.""It's obviously easier to sell to customer you already have vs. acquiring new ones."But the bigger reason to take a look at customer retention is that a surprising number of businesses have "one-and-done" customers. These are customers who buy from your business once and never buy from you again. The problem is particularly rampant in retail but also applies in other businesses such as ecommerce as well.

Knowing your customers

Your customer data is a valuable resource that you can use to improve customer retention. It can help you know your customers at a deeper level. For example, it can help you  know which customers are likely to buy from you again so you can target them with timely marketing communications. It doesn't make any sense to try to understand your "customer tribe" by surveying people who are loyal customers the same way that you survey people who are "one-and-done" customers. It makes more sense to to try to understand those customers who interact with and buy from your brand on a more frequent basis so you can nurture them how they want to be nurtured in order to drive more revenue for your brand. That's why using customer data to get to know your customers is important for customer retention.