Several people have stressed the importance of customer retention, but what does that involve in terms of real benefits for your business?

While many businesses stress the importance of retaining their current customers, some of them are wondering about the real benefits of consumer retention. In this empirical study, the author sets forth the main benefits related to building and retaining consumer loyalty, for example:

customer retention increases earnings:

• by lowering attrition rates;
• by increasing loyal consumer spending.

customer retention increases profitability:

• by allowing better monitoring of fixed costs;
• by decreasing customer costs of acquisition;
• by upselling to loyal consumers.

The author also points out the importance of measuring and analyzing retention within a business, for example by using the Net Promoter Score (NPS).

Source: http://www.adrianswinscoe.com/the-importance-of-customer-retention-an-empirical-study/