The Mathematical Formula for a Powerful Customer Retention - Plus a Ton of Tips

Publicado por Andres Aguerrevere en

The Mathematical Formula for a Powerful Customer Retention - Plus a Ton of Tips

Taking care of your customers after they have already purchased from you is as important as bringing new customers to your business. In fact, it is easier to convince someone who has already used your products or services to repeat, than trying to convert new leads. That’s why it is important that you apply the right strategies to keep your consumers coming back to you.

There are many  actions you can take to prevent your customers turning away from you, and if you apply them correctly, chances are they will not only come back to you, but they will also become your brand ambassadors, helping you get new leads.

Before jumping in in the how, let’s see the why with the benefits of applying customer retention strategies in your company:

  • It is cheaper: If you’re targeting someone that already knows your company and products, you reduce the costs in advertisement.
  • It makes marketing easier: When working with someone who was already made a purchase from you, you already know they are interested in your company. So it is easier for you to identify their needs, and how to provide solutions for them.
  • It’s more effective: Numbers show the conversion rates for both, new and existing ones. And while the probability of converting a new lead is 5% - 20%, converting an existing customer to repeat is 60-70%.
  • Profit increases: By improving your customer retention rate by a 5%, your profit raises 25%-95%.


The advantages of studying and using tactics for retaining your customers are varied, and the first step to successfully achieve it is by keeping track of your retention rates. This way you can see what things you are doing well and the areas you need improvement.


To get your retention rate, all you have to do is apply a formula that might seem a little complicated at first, but once you learn it and start working with it, it gets easier. First, you need to set a period of time to measure, it can be a trimester, and do as follow:


CE = Number of Customers at the End of the period


CN= Number of new Customers

CS= Number of customers at the Start of the period

((CE-CN)/CS))100=Customer Retention Rate


Here’s an example, imagine for a specific period of time you start with a total of 150 customers, lost 10, but gained 20 new ones; at the end of the period you have 160 customers. 160-20= 140. 140/150= 0.9, and finally, 0.9 x 100= 90. So, the retention rate for this period was 90%.


CE= 160

CN= 20

CS= 150


    ((160-20)/150)) 100 = 90%


To keep track of these figures is essential for companies in order to take the right measures to improve their retention rates and get the benefits from it.  Now that you now the reasons to it, and how to keep track, let’s see some of the strategies that will help you boost your retention rates:


  • Communicate your company’s values:

Everyone stands for something, if your company does too; people will feel more identified with it, feeling that your brand represents part of what they believe in. Identify your core values and work in accordance to them.

  • Resemble your customers:

The first part is getting to know your target, understand what they need and create a message they can identify with. If your customers feel related to you; they will more likely come back to you.

  • Become their consultant:

Be an expert in your field, let them know you can help them solve their questions, if you are the best at what you do, people will turn to you for solutions. Free consultation services are an excellent way to help customers feel you are on their side.

  • Offer an A+ customer service:

Don’t just sell, be sure to put effort into answering your customer’s doubts, guide them, and always be attentive to solve any possible issues.  This is a key element that many times goes unnoticed, but is the main reason many companies lose clients. Think of a restaurant, that has excellent food, but the service is not good, it will surely damage your complete experience and you will not want to come back.

  • Make sure to avoid problems:

We know that unforeseen events are part of life, but it is your duty to avoid at all costs any possible problems. It is not a matter of the quality of the product only. You must consider all aspects of the process; the response time, the packaging of the product, shipping costs, time and quality, customer service and payment issues.

  • Have a plan to solve problems:

You took all the necessary measures to avoid any problems, but something happened anyways. Is your team ready to provide a solution? Plan beforehand all possible issues that might rise and have an action plan ready to solve them as soon as possible.

  • Follow up after solution is provided:

This goes back to the customer services quality, after providing a solution, check up on them, ask about how they feel and let them know you’ve internally taken care of the problem, so to avoid future similar situations.

  • Use the right platform for support:

Know your customers and their needs; make sure you use the right channels to provide support. The right one will depend on the nature of your business, so adapt and create one that allows your customers to access easily and to have a response on time.

  • Prioritize quality above speed:

Make sure to take your time to make your customers feel certain about their purchase, don’t rush the process or limit yourself to just sell the product. Offer them different possibilities to make sure they get exactly what they need from your company.

  • Be active on social media:

Allow them to interact with you, share their feedback and experiences. This way they will be closer to you, and up to date of what is happening on your business. Add value; create a blog or weekly posts with quality content that complements what you sale.

  • Make it personal:

Don’t be generic; take your time to attend every case particularly. Make your customers feel special, let them know your understand them and want to help them out.

  • Create excitement for improvements:

Whenever there is an improvement in your products or services you and your team feel excited about it, right? Generate expectations; give cues of what is coming. Whenever you are launching any new elements, make sure your customers are eagerly waiting to see what’s next.

  • Spoil them:

Your customers are the core of your company; they are literally, the reason why you exist. So let them know that, you don’t need to invest tons of money, something as simple as a thank you e-mail, a small (even minimum) discount on their next purchase, free webinars, are great options to show your customers your appreciation.

  • Be creative with your sales:

Instead of selling them the “paid plan”, offer your customers “the VIP plan”, or the “Awesome customer plan”. It sounds way nicer and helps them feel special.

  • Create a loyalty program:

If your customers are happy with your company they will surely recommend you to others. Award this; give them discounts or coupons for every new customer that gets to you through their recommendation.


Put yourself in your customer’s shoes and think what things make you go back to a shop or a company. Go the extra mile for them and they will surely be loyal to your brand. Analyze carefully your sales process, get to know your customers and prepare a plan to apply the best customer’s retention strategies for your company.



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