The Harvard Business Review found that a 5% increase in customer retention can increase profits by as much as 25% to 95%. The math is fairly straightforward: it costs less to maintain the loyalty of an existing customer than it does to acquire a new one, and a loyal customer is likely to make repeat purchases, making their lifetime value quite lucrative.
With that in mind, the bigger revenue opportunity lies in having a thriving new business engine that pumps alongside a robust retention system. The new business engine continues to bring in new customers, and as long as the retention strategy is effective, that total number of loyal customers will continue to grow. Most business owners understand this truth intuitively, but separating new customer acquisition from customer retention misses a key opportunity.
First interactions define customer experience
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