Customer retention is important for businesses for several key reasons: (1) the cost of retaining an existing customer is much lower than acquiring a new customer, (2) increasing customer retention rates by 5% can increase profits by 25-95%, and (3) satisfied existing customers are more likely to purchase again and refer others than new customers.

1. Why is C.R important?
1. Customer acquisition cost & customer retention
cost are to determine ROI
2. Widely accepted formula: C.A.C = 6 X C.R.C
3. C.R increase 5% = Profit increases 25% - 95%
(cmo.com)
4. Converting existing customers = 60% - 70% vs.
converting new customers = 3% - 20%

2. Why is C.R important?
5. C.R impacts on C.A (WOM, referrals…)
6. Satisfied customers tell 9 other people about their
positive experience vs. dissatisfied customers tell 22
“word of mouse spreads even faster than word of mouth”
7. Repeat customer spend 33% more than new
customers
8. Every cent spent on improving customer
experience = 34% - 400% ROI increase
http://www.slideshare.net/custthermometer/22-customer-retention-stats
http://www.customerforlife.com/blog/salesforce/2013/03/26/retention-vs-acquisition/
http://www.cmo.com/articles/2013/7/18/customer_retention.html