Bringing em back

Everybody wants better customer retention, that’s a complete no-brainer. But most people don’t really have a benchmark to tell them what’s good. Sometimes the definition itself is not consistent across brands so if they’re comparing notes, they aren’t necessarily going to be talking of the same metric.

What should the metric be?

It could be any of these, and more, and be correct:

Ever Retained
  • Of all the customers I acquired prior to this year how many came back this year (how many of my older customers have I retained)
Acquired prior to this year 400,000
Old base transacting this year 100,000
% Retention 25%
Last Year retained
  • Of all the customers who transacted last year how many have I brought back this year
Transacted Last year 200,000
Of them transacting this year 75,000
% Retention 38%
Retained vs. New
  • Of all the customers who transacted this year what % was the retention base (acquired prior to this year)
Transacting this year 200,000
Old base transacting this year 100,000
% Retention 50%
Last year acquisitions Retained
  • Of all the new customers I added last year how many was I able to bring back this year
Acquired Last year 125,000
Old base transacting this year 40,000
% Retention 32%
Which is the right one to look at when comparing notes with others?

That’s tricky. Of all the metrics above our favorite is the second, Last Year Retained, it’s the cleanest and while it doesn’t account for winbacks of customers coming back after a while, it’s a good number to track.

However, if you want to know where you stand, and even better option is “what’s your retention out of the new acquisitions of the last year”, or option 4 above. It controls for a number of things like the tenure of your loyalty/ CRM program if you have one, or recent changes in technology at the front end, and takes away the advantage some may have of an old loyal base.

What should your Customer Retention be?

We’ve been working with many prospects and clients on driving repeat, retention and ultimately customer lifetime value, and have a few benchmarks we’ve observed over the years.


The key message is that 25%+ is the first goal to keep in mind. Half the benchmarks we have over some 40 Indian brands are over 25%. If you’re in the retail sector, in particular, 25%+ is not a number to boast about, it’s a number you shouldn’t fall below. Keeping retail company in this band are, e-commerce and beauty services.


Now that’s a hard number for most retail apart from Grocery to beat. It’s what categories like QSR and online ticketing attain, with online crossing 40%.

Sub 15%

This again is category specific with Hospitality and some high ticket specialty retail which has a long purchase cycle falling here.

Improving your Customer Retention

It’s the 4 basics you need to work on:

  • Know your customer: Be rabid about adding knowledge – profile, behavior, response, imputed data, third party sources
  • Mine the data: Dive deep into it, know what types of customers exist, who will show what behavior and most importantly, who will respond
  • Relevance in communication: Always up the game on relevance,communicate not just to brand and season related events but the customer’s journey with you too
  • Monitor, decentralize: Measure lift, celebrate the wins, get more and more people involved in building a culture of precision marketing

There are no reviews yet.

Leave a Reply

Your email address will not be published. Required fields are marked *

The message will be closed after 20 s

Gaziantep escort

bahçeşehir escort


izmir escort

deneme bonusu veren siteler

lunabit bedava bahis
lordspalacebet fenomenbet betvole betebet