All about Retention: What Next, After Acquisition?
8 min readMay 18


You’ve successfully acquired new customers for your business, and the initial excitement is palpable. You’ve put endless hours, hard work, and passion into attracting these users to your product.

But now what?

You can’t just stop there and hope for the best. This is where customer retention comes into play, and it’s equally (if not more) important than customer acquisition!

This blog will explore what customer retention is, the importance of customer retention, and discuss strategies to keep your customers loyal.

What is Customer Retention?

Customer retention is retaining your existing customers and getting them to return to your product/service for their subsequent actions, such as user sessions, engagement, purchases, etc.

70% of companies know retaining existing customers is cheaper than acquiring new ones. But only 18% prioritize customer retention, which is a mistake because your existing customers are your real asset!

So the simple logic behind this is that if you can keep your existing users engaged and coming back for more, your product value will grow immensely. It also means retaining a user is quite essential and cost-effective compared to acquiring a new one.

According to Bain and Company, increasing customer retention rates by 5% can increase profits by 25% to 95%. That is correct!

“Customer retention in a business directly translates to happy customers and long-term revenue.”

The Importance of Customer Retention for a Business in 2023

Customers are the building blocks of any business. Brands usually invest all their energy and budget in bringing on new customers. But, acquiring new customers costs five to seven times more than retaining them. That isn’t the sole reason why customer retention is essential for businesses. Here are some reasons why brands need to have a customer retention strategy to be successful in 2023.

- Customer Acquisition is too Costly

Acquiring new customers is time-consuming and expensive (almost 5–7 times). One reason behind this is the increasing advertising and marketing costs. With the steadily increasing acquisition costs, it is challenging for brands to generate revenue without hiking their prices.

Businesses should instead shift their focus to customer retention in 2023. Research shows that almost 68% of new users originate from existing users through word-of-mouth marketing.

Happy and satisfied customers transition into loyal brand advocates and spread the positive word about the brand. This, in turn, convinces more people to use the brand without any additional marketing, thus lowering the acquisition costs.

- Too many options available to choose from

Customers today are spoilt for choice. Every product has an alternative, be it a website or an app. Users don’t hesitate and think twice before jumping ship to another product.

It is essential for brands to have a well-thought-of retention strategy in place to build emotional connections with users and differentiate themselves from the competition.

- Loyal Customers spend more

Not all customers are equal. New customers or users are tentative about using your brand and might not have a huge order value. On the other hand, loyal customers keep returning to place orders with a comparatively higher order value, thus generating more revenue for your brand. Loyal customers trust your brand. Research shows that existing users spend almost 31% more on their orders and are 50% more likely to try a new product.

How to Master Customer Retention in 2023?

1. Seamless and Efficient Onboarding

Taking proper care of new users is crucial. The initial days after users download your app are critical for motivating them to engage and explore its features. If your app fails to effectively communicate and reinforce the value users expect during this time, they will likely lose interest and discontinue using it.

Simplify and streamline your onboarding process as much as possible. The more complex it is for users to get started with your app, the higher the chances of abandonment. Therefore, aim to make your mobile app onboarding effortless.

One effective approach is to minimize the information required when creating a new user account. By only asking for necessary details, optimizing app loading speed, utilizing visually appealing elements, providing a brief introductory video, and ensuring a logical flow, you can reduce the cognitive burden on users.

Psychology plays a significant role in determining the success of your onboarding process. You will undoubtedly witness higher user retention rates and increased customer loyalty by offering users a sense of achievement and providing all the contextual information necessary to build trust.

2. Use Push Notifications and In-App messages (The Smart Way!)

Imagine walking into a store and receiving no acknowledgment or assistance from the staff. Naturally, you would feel disappointed and dissatisfied with the customer service.

The same concept applies to app interactions!

App interactions can be as simple as welcoming new users through push notifications or in-app messages providing valuable and relevant information as users navigate through your app.

And did you know implementing push notifications can significantly increase app user retention by up to 20%?

Successful apps use push notifications thoughtfully and strategically to connect with their users. You can further improve user retention by employing behavior-based or time-optimized push notifications.

For instance, offering relevant deals based on user interests and usage patterns effectively encourages app usage. Additionally, personalized and compelling push notifications can re-engage users who may have dropped out of the conversion funnel.

In-app messages, such as popups or notifications displayed while users interact with the app, are also essential. They help redirect users’ attention to the app’s core features and allow for direct communication without barriers.

3. Deliver a Personalized Experience

Ensuring your users feel valued and special should always be a priority, regardless of the efforts required. As customer expectations continue to rise, personalized offers have become crucial in retaining new customers and meeting their ever-growing demands.

By providing a personalized user experience, you establish a direct connection with your users and keep them engaged with your app. To personalize your mobile app according to your user base, you must gain a deep understanding of your users and their preferences.

Gathering details such as location, interests, age, purchase history, and usage patterns enables you to create custom preferences for each user. Once you understand the individuals within your user base, you can take it a step further by segmenting users with similar preferences.

This allows for more efficient data collection and enables you to make targeted improvements to your mobile app, thereby increasing user retention. By leveraging personalized experiences and continuously refining your app based on user insights, you can enhance user satisfaction, strengthen loyalty, and foster long-term customer relationships.

4. Include In-App Gamification

In today’s mobile-first era, capturing and maintaining people’s attention is an immense challenge but not impossible. Gamification involves using user data to incentivize desired behaviors and employing psychological triggers to engage users and maintain their attention.

In-app gamification enhances the user experience by incorporating game-like elements such as spin the wheel, point collection, rewards, leaderboards, or contextual notifications. These elements contribute to a fun and fulfilling experience that keeps users motivated and engaged.

Gamification is not only cost-effective but also an effective strategy to boost user retention. Users enjoy being rewarded, and with in-app gamification, your users will become more engaged and loyal and more likely to increase their involvement and investment in your app.

For further insights on implementing in-app gamification in 2023, I recommend reading “The Complete Guide to In-App Gamification.” By embracing gamification, you can significantly enhance your retention strategy and create a compelling and rewarding user experience.

5. Listen to your Users — Gather Consistent Feedback

Ensuring user engagement is crucial for fostering satisfaction among your customers. To establish a strong relationship with them, making them feel valued and appreciated is essential.

A key component of mobile user retention is actively seeking and acting upon user feedback. With feedback, it becomes easier to understand what your users truly want.

By gathering feedback, you can gain valuable insights into customer sentiment and make necessary changes to encourage their continued engagement. Conducting surveys targeted at your specific audience and collecting feedback about their experience with your product or service thus far can significantly enhance your user retention rates.

This feedback-driven approach allows you to identify areas for improvement and strengthens the bond between you and your customers.

It demonstrates that you value their opinions and are committed to delivering an exceptional user experience. By actively seeking and acting upon user feedback, you can continuously refine your offerings and ensure your customers remain satisfied and loyal.

6. Track and Make use of Data

To succeed in the mobile realm, tracking and analyzing your efforts to determine what is effective and what is not is essential. This requires using a customer engagement tool or software that provides valuable insights into user retention and campaign performance.

By utilizing a reliable customer engagement tool, you can gain access to the necessary data and metrics to assess the effectiveness of your strategies. These insights allow you to understand how well you retain users and accurately measure your campaigns’ impact.

With the right data insights, you can enhance user interactions and make informed decisions to improve retention rates. You can develop and implement effective app retention strategies by identifying any obstacles or challenges users encounter while using your app.

By leveraging data-driven insights, you can strengthen your overall mobile user experience, improving user retention. With a deep understanding of your users’ behaviors and preferences, you can refine your strategies and create a more engaging and valuable app experience.


Customer retention is an essential aspect of any successful business venture. It is part of the company’s growth strategy and a catalyst for scaling up its business. In this sense, companies that can retain their customers and market share will be the ones that are leaders in the industry.

It will be challenging and require a lot of work, but working toward customer retention should be a goal for every business. Once you have figured out the customer retention basics and how to increase it within your company, there are many other strategic ways of building it.

The Advantage is an omnichannel, user engagement, and gamification platform that helps digital product owners and marketers improve product adoption and conversions.

With, FinTech, HealthTech, Insurance, and EdTech firms can enhance their digital experiences with pre-built gamification features. It can provide personalized insights, actionable recommendations, and contextual nudges designed to deepen its relationship with its users.

Book a demo of the most comprehensive user engagement and gamification platform to achieve your digital product goals. Join our communities for more insights, guides, and best practices that keep you updated with proven strategies and tips to supercharge your campaigns.

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