Retention

Also called Customer retention, Repeat business

Keeping the customers you already have. Cheaper than acquisition and consistently underfunded.

What it means

Retention is the proportion of customers who stay, the mirror image of churn. It also describes the activity: onboarding, support, account management, and the deliberate work of staying useful.

Why it matters

Existing customers cost nothing to acquire, buy more readily, and refer others. The arithmetic is overwhelming and the budget rarely reflects it, because acquisition is visible and retention is not.

Retention is also the compounding term in growth. Two businesses acquiring identically will diverge enormously over three years on retention alone.

What it looks like in practice

Fix the first ninety days first. Most losses happen early, and early losses are usually about expectations and onboarding rather than the product.

Talk to customers who have not bought recently, before they formally leave. Lapsing is quiet.

Measure repeat purchase rate and time between purchases, not just satisfaction. People report being satisfied and leave anyway.

What to watch out for

Retention bought with discounts, which reduces margin and trains customers to threaten to leave.

Assuming silence is contentment. In most businesses, the majority of unhappy customers never complain; they simply stop.

Where to get proper advice

Your own customers, asked directly and regularly. This is one area where external advice is much weaker than a dozen honest conversations.