Social media and customer retention are intrinsically linked because social has become a key player in the entire customer journey.

The average buyer’s journey is becoming more dynamic, and social customer care is a way to capture your audience’s attention when the competition is fiercer than ever.

There’s no denying that customer retention should be a top priority if you want your business to thrive long-term. The 2023 State of Social Media Report found that 88% of business leaders agree social media data and insights are critical to customer retention and delivering exceptional customer care.

Throughout this article, learn more about how social media and social listening can play a role in retaining and delighting customers, plus several proven customer retention strategies you can implement today.

What is customer retention?

Customer retention measures a business’s ability to keep customers over a given period of time. The opposite of customer retention is customer churn, a metric that shows how many customers a company has lost over that same period of time.

Customer retention rates vary by industry. For example, Statista found that businesses in the media and professional services industry have an average customer retention rate of 84% while hospitality, travel and restaurants have an average rate of 55%.

The definition of customer retention underneath a question mark and the question: what is customer retention?

How to calculate customer retention rate

The formula to calculate your brand’s customer retention rate is:

((# of Customers at End of Period – New Customers Acquired During Period) / # of Customers at Start of Period) x 100

Why is customer retention important for businesses?

It’s common knowledge that keeping existing customers is cheaper and easier than acquiring new ones. When a customer is already familiar with your brand and product or services, you don’t need to spend as much effort and costs to attain them in the first place.

This can lead to predictable revenue that sustains your business, giving your brand a solid foundation to grow from year-over-year. A high customer retention rate also increases your overall customer lifetime value. Whether customers increase their business with you over time, or refer you to their friends and family, it means more money in your pocket per customer and reduced marketing costs.

Customer retention also leads to brand loyalty, which can be a source of continued feedback and insights into what is and isn’t working.

This is why brands often put tactics in place to keep customers around for as long as possible—a few of which we’ll explore shortly.

How can social media play a role in customer retention?

Social media is a huge asset to customer retention due to its unique ability to facilitate connections between brands and their customers. Because brands and customers can communicate directly with each other, social media provides the perfect relationship-building outlet.

It’s also a virtual gathering place filled with powerful insights about what people think and feel about your brand. Using social listening, you can get an unfiltered view into how your brand is perceived and what your audience is most interested in getting from you.

Having an active presence on social media is a great way to build relationships with your customers and make them want to continue buying from your brand. A few tactics to use include:

  • Offer customer service on social media, helping clients and customers find solutions without having to leave their preferred social platform.
  • Set up social media chatbots that help customers complete actions or direct them to a live representative.
  • Engage with your audience’s social media content, liking and responding to posts that either mention your brand or are relevant to your products/services/industry.
  • Create content that your audience will enjoy and want to interact with.
  • Promote ads and social media posts that are personalized to specific segments of your audience by taking advantage of audience targeting features.
  • Share genuinely helpful and authentic content that makes your audience appreciate your brand.

How to increase customer retention

Don’t let your initial investment of time, resources and relationship-building go to waste. Below are proven customer retention strategies that encourage folks to stick around for the long haul.

1. Invest in your onboarding process and customer resources

The importance of onboarding can’t be overstated when it comes to customer retention. This is the first interaction a customer has with your business after making their purchase decision—don’t make them regret it.

This realization turns onboarding into a make-or-break process. Ask yourself: Are you empowering your customers to make the most of your product or service from the start?

Doing so requires a combination of resources. From self-service options to product videos and beyond, companies should strive to put their onboarding materials front and center in as many formats as possible. This ensures you appeal to all of your customers, not just a small set of them.

At Sprout, we give our customers a variety of resources in our Help Center, so they can learn about our product based on their needs.

Sprout's Help Center homepage with tiles and search bar for addressing any problems or questions customers have about the product.

From product release notes and support articles to on-demand webinars, we help customers fully understand our products’ features—no matter how you prefer to learn.

The process of churn reduction doesn’t happen by accident. The more guidance you’re able to give customers, the better.

2. Create a sense of community through user-generated content

Education isn’t the be-all, end-all of customer retention.

Perhaps one of the more straightforward strategies to reduce churn is simply engaging with your customers via social.

Picking their brains. Celebrating their success stories. The list goes on and on.

Sharing user-generated content (UGC) in the form of reviews and customer photos represents a way to engage your customers and build a much-needed sense of community among your buyers.

For example, brands should make a conscious effort to share shout-outs and compliments from their customers.

And if you sell a physical product, encouraging customers to share photos of your product in action is a no-brainer. Many brands make UGC a cornerstone of their content strategy.

Among our customer retention tactics, this is perhaps the lowest-hanging but most fun. Don’t be afraid to show off your personality and engage your audience.

Sprout Social x/Twitter post featuring UGC

3. Actively ask for customer feedback to improve your experience

Gathering feedback represents a win-win for businesses and customers alike.

Not only do you show your customers that you care about providing a stellar experience, but you also gather invaluable testimonials to learn how to better serve your base.

Something as simple as an email asking for a review is a good starting point, providing an open-ended avenue for customers to share their thoughts.

An example of an email from Graza, an olive oil brand, that prompts the customer to leave a review after a recent purchase

These types of messages should ideally be sent relatively early in the customer lifecycle—like right after onboarding—to keep your relationship positive.

4. Speed up and step up your social customer care

No surprises here. People overwhelmingly take to social media to speak their minds.

Whether it’s a question, complaint or compliment, you need to come up with timely, thoughtful responses.

The good news is that providing social customer care doesn’t have to mean scrambling or refreshing your X (formerly known as Twitter) feed 24/7.

Instead, take advantage of your marketing tools, such as your CRM or social media management tools. Sprout’s Smart Inbox keeps tabs on notifications and @mentions from social, so you never miss a potential crisis. Make a conscious effort to reply to each response personally or refer folks to the proper social media customer service channel to get things resolved ASAP.

Sprout's Smart Inbox where messages from across all attached social channels are funneled into one feed, making it easier for customer care teams and social teams to monitor all social messages in one hub.

5. Reward your most loyal customers

Customer retention isn’t all about righting wrongs or preventing mistakes.

It’s about being proactive. Perhaps one of the best ways to ensure your happy customers stick around is by rewarding their loyalty.

There’s a reason why loyalty and brand ambassador programs are popular among brands. For the sake of retention and keeping people from bouncing to a competitor, rewards and point systems can do the trick.

For example, check out how Smashbox encourages its satisfied customers to keep spending.

A landing page for a rewards program that Smashbox sends to customers.

This encourages long-term customers and makes your base feel like VIPs by virtue of getting better deals.

6. Listen closely to your lost customers

If you’re trying to figure out how to retain customers, look no further than the ones you’ve lost.

Whether it’s a nasty email or a good old old-fashioned roasting on social, you can’t keep 100% of your customers happy.

That said, if you want to reduce churn, you shouldn’t ignore all negative feedback concerning your brand. Listening to customer complaints clue you in on what not to do in the future. If you find that multiple customers are complaining about the same problem or concern, it’s probably time to take action.

Social listening tools like Sprout give you a detailed look at customer sentiment. You might be surprised at the common threads between your lost customers in terms of what they complain about, leading to org-wide improvements in your product or service.

The sentiment analysis summary in Sprout's Social Listening solution, showing how many positive vs. negative messages mention a brand or keywords you choose to monitor.

7. Set expectations to create a better customer experience

Customer experience matters, as does setting expectations about the experience you provide—especially if you’re in ecommerce..

For example, what does your shipping policy look like? Do you offer exchanges and returns? Any guarantees?

These policies are key to ensuring that your one-off customers return in the future. Since they provide customers with peace of mind, you shouldn’t be shy about promoting them.

For example, companies like Red Wing Shoes promote their free shipping and return policies as soon as you land on-site. Meanwhile, they clarify further on their dedicated “Support” page.

Red Wing Shoes' website where they promote free shipping and return policies as soon as you land on-site.

Coupled with a generous and explicit return policy and guarantee, customers know exactly what to expect and understand that the brand is willing to commit to their customers.

The 30-day guarantee listed on Red Wing Shoes' website.

Just make sure you can stick to whatever promises you make. Failure to do so can result in an unflattering call-out.

8. Keep customers in the loop about your latest products, launches and updates

Remember: Your customers aren’t mind-readers.

And besides, they’re likely juggling a ton of different products at any given time.

Rather than assume they’re aware of your latest update or read your most recent marketing email, you need to make an effort to keep them in the loop through social media as well. Build product launches and updates into your content calendar to make sure customers are informed and engaged.

An X/Twitter post from Otter.ai announcing Otter AI Chat.

9. Establish a follow-up frequency that keeps customers engaged

Again, staying on positive terms with your customers means being proactive.

Frequent check-ins, such as outreach emails or calls, help. But you have to walk a fine line between checking in and potentially annoying your audience.

When in doubt, think “less is more”, but be sure to establish some sort of check-in frequency. Doing so will also make the process of cross-selling and upselling easier and more intuitive.

There are likely tools in your marketing stack that can help here. For example, a CRM like Salesforce has a built-in follow-up frequency setting that remind you when to contact customers.

Adjust your settings to follow up with high-ticket customers more frequently and so on. Note-taking in your CRM is also a smart move to tweak your follow-ups with certain customers—like a particular customer or account who doesn’t want to hear from you frequently.

Also, consider how tools like Sprout help you keep track of your social interactions and conversations. Case Management within our Smart Inbox gives you a snapshot of your history with any given contact, making it easier to provide personalized service and care.

An example of how Cases appear in Sprout with the ability to see a customer's conversation and reply internally to align on how to respond.

Consider that many customer retention programs fail due to a lack of organization. With automated reminders and message-logging, you can keep better track of your relationships and follow up in a way that makes sense.

10. Regularly share engaging content on social media

Competitors, creators, family, friends and other brands are all vying for consumers’ attention. Creating and sharing engaging content is essential to capturing your audience’s attention and keeping them interested.

Offering a regular calendar of entertaining or educational content keeps your customers engaged, your brand top-of-mind and encourages them to return for more. Regularly engaging with them through content helps strengthen the bond between you and your customer, as you work to serve their needs and interests.

Plus, your social content can also lead to organic growth as your engaged customers become brand advocates, spreading the digital word about your brand to their connections.

11. Exclusive social media promotions or contests

Special social media promotions or contests can be a powerful customer retention strategy. Contests create a sense of excitement, engaging your customers in a game of chance. They become more emotionally invested as they eagerly anticipate the results. The thrill of possibly winning prizes also encourages interaction with your social content, keeping them active and engaged with your brand.

Exclusive promotions work similarly by keeping your audience continually engaged while waiting for the next sale or special code to be released. It serves as a reward for following your brand and engaging with your content by giving them exclusive access to deals.

12. Run interactive polls and quizzes on social media

This interactive content invites your audience to participate directly with you, becoming active contributors to your brand’s content. This form of engagement can foster a sense of connection because they feel involved and their contributions are valued.

Polls and quizzes also provide valuable insights into your customers’ preferences and opinions. You can then use these insights to tailor future content to your customers’ needs and interests more effectively.

Essentially, interactive social posts engage your existing customers by making their inputs important, while telling you how to better personalize your content, which leads to greater loyalty.

13. Maintain consistent branding across channels

Consistency builds trust and familiarity. When customers know what to expect from you, they are more likely to return.

Using the same branding across platforms creates a cohesive brand identity, boosting customers’ confidence by reassuring that they’re engaging with you no matter the platform they choose. Consistency also applies to how you communicate with your audience.

Being consistent in your content and how you respond to comments, customer questions, complaints or kudos reinforces your brand’s core values and promotes a seamless experience across channels.

Fostering an environment where your customers are comfortable and know what to expect strengthens your relationships with them because you create a sense of reliability and stability.

The importance of social listening in customer retention

Social listening is a strategy that revolves around the analysis of customer sentiment about a brand. Through social media tools, brands can easily monitor online mentions and conversations around their products, services, industry or the brands themselves.

Some of these conversations can even let brands in on what their target customer is looking for. Social listening—especially when used in relation to customer retention—is much more than simply monitoring the sentiment around your brand.

Instead, it’s important to analyze what your target audience is actually saying. Pay close attention to things like:

  • Issues your target audience is having with your competition. Use it to offer a better product.
  • Pain points your audience has with your product. Can you launch additional features or settings to make it a better fit?
  • Positive and negative sentiments about your brand. Get information to actively optimize your presence.

Using social listening tools to increase customer satisfaction, keep customers longer and improve brand sentiment.

What does your customer retention plan look like?

You’ve already done the hard part by winning your customers over in the first place. Now you need to make sure you’re paying attention to customer retention so they stick with you in the long run.

The good news is, you can easily roll out any combination of these customer retention strategies with the right data and tools.

To continue making informed business decisions, check out the latest Sprout Social Index™ with key social media statistics for 2024.

Customer retention FAQs

What is customer retention in simple words?

Customer retention is the process of keeping customers engaged and continuing to buy from a business over time. It contrasts with customer churn, which indicates the number of customers a business loses.

What is an example of customer retention?

An example of customer retention is implementing a loyalty program that rewards customers for their continued business, such as offering points for purchases that can be redeemed for discounts or free products.

Why is customer retention so important?

Customer retention is crucial, as it’s more cost-effective and simpler to maintain existing customers than to attract new ones. Retained customers not only ensure a steady revenue stream but also increase the overall lifetime value of each customer.

How do you retain a customer?

To effectively retain a customer,

  1. Enhance the onboarding process.
  2. Provide valuable customer resources.
  3. Foster community through user-generated content.
  4. Regularly solicit feedback.
  5. Improve social media customer interactions.
  6. Reward loyalty.
  7. Maintain clear communication about new products and updates.
  8. Establish consistent engagement through follow-ups.
  9. Ensure your branding is uniform across all platforms.
  10. Post engaging content and exclusive promotions on social media.

What are the 3 R's of customer retention?

Retention is one of the three R’s of customer loyalty. The three R’s of customer loyalty are retention, reputation and referrals.