How to build your customer retention in 2025

Customer retention is essential for sustaining and growing your business. While acquiring new customers is important, nurturing strong relationships with existing ones is key to long-term success. Loyal customers not only drive repeat sales and provide valuable feedback but also serve as brand advocates, attracting new customers and amplifying their impact.

Before we go into how to increase customer retention, we must first understand this term in detail. At ERC, we consider customer retention to be the process of nurturing and maintaining existing customer relationships, in a way that yields repeat sales, positive word of mouth, and valuable referrals. If you’re more of a maths brain, this can be calculated via a formula: 

You can assess your retention rate against your competitors—if it falls below the industry average, it’s a good idea to explore ways to enhance your customer retention strategies. Focusing on retaining customers not only reduces customer acquisition costs but also increases customer lifetime value. So, what benefits does this bring?

✔ Positive Brand Perception

Satisfied customers can transform into advocates for your brand. Customers often have relationships with other likely customers within your same target audience. By recommending you to their friends and family, it can expand your reach and positively affect the view of your brand - at a fraction of the cost.

✔ Competitive advantage

Customers who have positive experiences with you are more likely to remain loyal to your brand and are less inclined to switch to a competitor. Strong brand affinity builds loyalty, making them more likely to make repeat purchases if they feel appreciated and have had a great experience with you.

✔ Simpler up-selling

Loyal customers are more inclined to purchase premium products or upgrade to higher-level subscription plans, because they’re familiar with the brand and trust its quality. They’re also more open to new product releases, as they have had positive experiences with your previous offerings. This makes it easier for your brand to introduce new items with less risk.

So, how do we focus on customer retention? Here are a few key strategies your business can consider to start. If you want a more in-depth chat about this topic, please don't hesitate to reach out and book a call with us to discuss how we can help you.

1 Improve the onboarding process

You can use callouts and pop-ups on your website to help guide potential customers through the checkout process. This makes it as simple and convenient as possible, streamlining the checkout process. You can also send reminders to customers to remind them to complete the process and return to buying your product. Additionally, adding a chat function to your website can help customers easily gain the information they need, facilitating a potential purchase. If you have a Shopify storefront, there are a multitude of apps you can use to do this with minimal HTML setup. Examples include Tidio, LiveChat, and BestChat. Most of them offer a free tier so you can get started and test them out before you commit to their cost.

2 Loyalty Schemes

These are key to making a customer feel valued by your brand. Offering reward points in exchange for discounts is a good way to make customers continually buy from you. You can also send exclusive invites through email or social media to loyal customers and give them previews or special discounts on sales.

In line with this, referral schemes reward your loyal customers and incentivise them to share your brand with their friends and family. A simple way to do this is through sending them referral links which they can share with others. Then everyone gets rewarded - discounts for both parties and a new customer for you!

3 Customer communities

By creating communities where customers can connect with each other, your brand becomes more than just a product they consume. When customers engage with others who share similar values and interests, they feel like they’re part of something bigger than just a transactional relationship. This sense of belonging enhances their emotional connection with your brand and strengthens their loyalty.

Depending on your product, you can create specific forums dedicated to your product on your website. This method also allows you to quickly respond to customer queries and gather feedback on what customers want to see more of. Members will also be able to respond to each other’s queries, using their knowledge of your product to help one another. Over time, this will create a library of typical queries and answers, which customers can use to answer their questions. 

If you want to create a sense of community while remaining cost-effective, social media is a great tool. A well-crafted hashtag aligns with the brand’s values and messaging, reinforcing its personality and positioning, and can be used in all types of marketing When customers see real people using and loving a product, it creates trust and credibility, influencing potential buyers. A great example of this is #MyCalvins - the brand used celebrity influence, but the tagline “I ___ in #MyCalvins” invited all users to personalise their posts, filling in the blank with actions like "work," "chill," "dream," or "love." One reason for its effectiveness is its promotion of inclusivity, allowing anyone to contribute to the hashtag and participate in the conversation.

4 Re-engage inactive customers

Re-engaging inactive customers is a great way to improve your customer retention. Inactive customers are those who have bought from you, but haven't purchased again for a while and are in danger of disengaging with your brand. Remind them of the value of your products and services, and sweeten the deal with come-back discounts and offers. This can be done through ‘Winback’ emails, which you can schedule to send to customers who haven’t interacted with your business in a while. Studies show that 45% of customers who get a win-back email will open your future emails, opening the doors for more sales for your brand. If you’d like guidance on creating these types of emails, we can help you refine your messaging, optimise engagement, and craft compelling content that resonates with your audience.

5 Customer service quality

Improving post-sales support, keeping in touch with new updates or offers, and maintaining quick and open communication with your customers is key to maintaining a positive perception of your brand. There is a saying which goes ‘"A satisfied customer might tell a friend, but a dissatisfied customer will tell the world." It’s pretty true—people are way more likely to share a bad experience than a good one. That’s why great customer service is so important. If you focus on creating positive experiences, you can turn customers into loyal fans instead of critics. Ensure that your customer service team is fully trained, not just on product knowledge but also on how to handle difficult situations, manage emotions, and communicate effectively. Make sure customers can reach you through their preferred channels, whether it's social media, email, live chat, or telephone. Being accessible across multiple platforms shows that you care about meeting them where they are. Focusing on these areas can significantly improve your customer service quality and ensure customers feel valued, heard, and satisfied.

Customer retention is not just about keeping customers—it's about creating lasting relationships that drive long-term success. By focusing on strategies like improving onboarding, implementing loyalty programs, fostering customer communities, and maintaining high-quality service, businesses can turn one-time buyers into lifelong advocates. In 2025, competition will only grow fiercer, making retention more crucial than ever. Prioritising customer satisfaction will boost sales and enhance your brand’s reputation and influence. 

If you’re ready to refine your customer retention strategy, reach out to us—we’d love to help you build a stronger, more loyal customer base. Get in touch here.