Customer Retention – How Much is it Worth To Your Business?

The Value of Customer Retention in a Digital Customer Experience (#CX)

Why is customer retention important? Economics….

A 5% increase in customer retention produces more than 25% increase in profit

In the context of why segmentation, personalization, setting engagement value goals and designing an integrated digital customer experience, I want to highlight a Bain & Company Study on “Loyal Relationships”

Here, the study (with case studies) highlights the  cost of growing an existing customer vs cost of acquiring and then building relationship with a new customer.


What are the economic dimensions (what’s the benefit)?

1. Return customers tend to buy more from a company over time.

2. As they do, the operating costs to serve them decline.

3. Return customer refer new customers to your company!


The key is to focus on the right customers. The key is sto segment your customers and use analytics to understand which category of customers are most profitable. This will enable you to focus investments and shift resource to higher value segments. In the relation to context marketing, it will also enable you to test and optimization for conversions, your digital customer experience.

Customer loyalty doesn’t just happen on it’s own.


Thoughtful, purposeful digital customer experiences enabled by an integrated digital experience platform like Sitecore enable organizations to engineer loyalty. You can go to to learn more about the Sitecore Experience Platform, but here, I wanted to focus on the why.. Why loyalty is important and how it relates, in basic terms, to the bottom line.

As highlighted in the Bain and Company study, “ No company is immune to the pressures of the market. But companies that focus on building loyal relationships that by their very nature keep costs to a minimum are far better positioned to remain strong in the face of market turbulence.”

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