Retention marketing: Strategies, metrics, and examples [2026]

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Retention rate is one of the clearest indicators of a business’s health and sustainability. It measures your ability to build lasting relationships with customers, and when customers keep coming back, sales grow more predictably, and profits increase. 

Higher retention also drives up customer lifetime value and shifts growth from acquisition-heavy to loyalty-led. That means you can scale without continually increasing costs to attract new customers.

This article breaks down retention marketing, how it differs from acquisition marketing, and why it’s essential for long-term growth. You’ll also learn proven strategies, key metrics, and real-world examples that show retention marketing in action.

What is retention marketing?

Retention marketing focuses on keeping existing customers engaged, satisfied, and coming back to buy again. Rather than chasing only new customers, it aims to strengthen long-term relationships that lead to consistent growth.

This marketing strategy aims to accomplish several objectives, such as:

• Increase customer lifetime value (CLV): Encourages repeat purchases and higher order value, making each customer more valuable over time 
• Reduce churn rate: Helps identify customers who may be disengaging and gives them clear reasons to stay
• Build brand loyalty: You’ll create meaningful, consistent experiences that turn customers into brand advocates
• Increases profitability: When you sell more to your existing base, it can reduce your marketing costs and make margins look a whole lot better 
• Generate referrals and word-of-mouth: Happy customers are your best marketing team because they’ll share the experience with their friends
• Improve customer retention rate: Retention marketing increases the percentage of customers who continue buying over a specific period
• Create predictable revenue: You’ll build a reliable revenue stream through repeat purchases and ongoing customer engagement

Retention marketing vs. acquisition marketing

Retention marketing and acquisition marketing both play important roles in building a sustainable business. However, they serve different purposes and require distinct strategies. 

Acquisition marketing targets a broader audience that may be interested in your product. Conversely, retention marketing focuses on existing customers who’ve already used your services.

Acquisition marketing relies on channels such as social media advertising, search engine marketing (SEM), content marketing, and email acquisition campaigns to attract new leads. It also measures success using metrics such as customer acquisition cost (CAC), conversion rates, and brand awareness.

Retention marketing, on the other hand, uses email marketing, loyalty programs, and exceptional customer service to retain existing customers. It tracks progress through customer churn rate, customer lifetime value (CLTV), and repeat purchase rate.

While acquisition marketing tends to be more expensive, retention marketing is generally less costly. That’s because it targets a pre-qualified audience of people who’ve already used your products.

Here’s a comparison of acquisition vs. retention marketing:

After comparing retention and acquisition side by side, the differences become even clearer when you look at cost, value, and long-term impact.

• Cost efficiency: Acquiring new customers costs more than retaining existing ones. Retention marketing re-engages an already-qualified audience, making it more cost-effective.
• Long-term value: Acquisition marketing is optimized to get customers to make that initial purchase. On the other hand, retention marketing prioritizes maximizing customer lifetime value by encouraging repeat purchases and long-term engagement.
• Relationship depth: You can create initial brand awareness through acquisition marketing. But retention marketing builds deeper relationships through personalized experiences, ongoing communication, and trust.
• ROI timeline: Acquisition campaigns may require longer timelines to educate and convert new audiences. In contrast, retention marketing delivers faster ROI because it targets customers who already know and trust your brand and have purchased from it.

Importance of retention marketing

Retention marketing allows you to maximize the value of your existing customers by:

• Being more cost-effective than acquiring new customers: Marketing to existing customers is more affordable because they already trust your brand and products.

In ecommerce, the average customer acquisition cost ranges from $64 to $68, making retention a far more cost-effective way to drive repeat revenue. 

• Increasing customer lifetime value (CLV): Retention strategies can increase the total revenue each customer generates over time.

In a recent report, 42% of sales leaders said recurring revenue from long-term customers was their biggest revenue source, shifting the focus from one-off transactions to long-term stability.

• Leveraging word-of-mouth and referrals: Loyal customers are more likely to recommend your brand, creating high-value referrals. Since 86% of consumers say personal recommendations strongly influence their purchasing decisions, referred customers tend to convert faster and are more likely to become valuable, long-term customers. 
• Driving profitability: Retention marketing increases repeat purchases and customer lifetime value without raising acquisition costs. Even a five percent increase in customer retention can lead to a 25–95% increase in profits, underscoring the financial impact of keeping existing customers engaged.
• Ensuring repeat customers spend more: Customers who return to buy typically spend more over time than first-time buyers, increasing overall revenue per customer. Loyalty programs reinforce this behavior, with brands seeing up to 5.2X ROI from loyalty initiatives that encourage repeat purchases and long-term engagement.
• Achieving higher conversion rates: Existing customers convert more easily than new prospects because they already trust your brand, making targeted offers more effective.

Tools like AI-powered personalization can help deliver relevant recommendations, which 64% of USA shoppers say have improved their retail experiences, further increasing conversion rates for returning customers.

If you want recent proof that retention is getting more “intent-driven,” the Omnisend 2026 Ecommerce Marketing Report shows a clear pattern: open rates continued rising, even as click rates declined — but click-to-conversion jumped 53% YoY, meaning fewer clicks, but higher-intent buyers when people do click. That’s one reason retention messaging works best when it’s personalized and timed to behavior rather than sent as broad blasts.

How to calculate retention rate

Understanding how to calculate the retention rate is essential for ecommerce marketers seeking insights into customer loyalty. It shows how well your business retains customers. This makes it a direct indicator of whether your retention marketing efforts are working. 

While the calculation may look complicated at first, it’s simple once you understand the formula and know which customer data to use. In this section, we’ll cover the retention rate formula, walk through step-by-step instructions, and share a real example of retention rate calculation. 

You’ll also get access to a free retention rate calculator and industry benchmarks to help you evaluate your results. 

Tracking retention rate on a monthly, quarterly, or annual basis helps ecommerce businesses identify trends over time. It also measures whether your retention strategies, such as email automation, loyalty programs, or winback campaigns, are yielding positive results.

What is a retention rate?

Retention rate is the percentage of customers who continue to buy from your business over a specific period. It shows how effectively your brand engages customers after their first purchase and encourages repeat buying.

It’s one of the most important metrics for ecommerce businesses because it directly impacts customer lifetime value, revenue stability, and the return on your marketing efforts.

Retention rate formula

Retention rate calculation is the process of measuring the percentage of customers, users, or employees who remain with a company or service over a specific period. 

To calculate the retention rate, start by selecting a specific time period, then record how many customers you had at the start. Subtract new customers gained within that period from your ending total. Divide that number by your starting customers and multiply by 100 to get a percentage. Here’s the formula to use:

If you started the month with 1,000 customers, acquired 200 new customers, and ended the month with 900 customers, your retention rate would be: ((900 − 200) / 1,000) × 100 = 70%.

Retention rate calculator

A retention rate calculator helps you measure how well your business is keeping customers without manually working through the formula. It simplifies the process, reduces the risk of errors, and saves time when analyzing performance. Simply enter the data for the selected period to instantly calculate your retention rate.

Ensure to use the calculator with your business data to get an accurate view of customer loyalty and track how your retention strategies perform over time.

What is a good retention rate?

A “good” retention rate depends on your industry, business model, and the type of product you sell. There’s no single universal benchmark, but in most cases, a retention rate that meets or exceeds the industry average can be considered “good.”

Common benchmarks for ecommerce businesses include:

• General ecommerce: ~ 30–31%
• Subscription ecommerce: ~75–90%
• Luxury or high-ticket items: ~5–10% 
• Consumable products: ~40–65% 

That said, industry benchmarks should be used as a reference point. It’s not a final verdict, so don’t feel inadequate if yours doesn’t measure up.

Retention rate is most valuable when tracked over time and compared against your own historical performance. This reveals whether your retention strategies are improving results. An optimal retention rate for your business will also depend on factors like purchase frequency, product type, and price point.

Average retention rate by industry

Here’s the average retention for different industries:

• Fashion/apparel: ~32–65% 
• Health and beauty: ~60–70%
• Food and beverage: ~70–80%
• Electronics: ~28–65%
• Home and garden: ~45–55%
• Subscription boxes: ~80–90%

High retention rate vs. low retention rate

Your retention rate reveals a lot about how customers experience your brand and where your retention strategies may need improvement.

High retention rate indicators

A high retention rate usually indicates that customers are satisfied, see value in your products, and are willing to return after their first purchase. This translates into more predictable revenue, higher customer lifetime value (CLV), and lower marketing costs. You’ll spend fewer resources to bring in repeat purchases.

Low retention rate indicators

A low retention rate may signal friction in the customer experience, product quality issues, stronger competition, or underperforming retention strategies. Identifying the issue requires analyzing churn reasons, reviewing customer feedback, and closely examining purchase patterns to identify where customers drop off.

Here’s how to improve a low retention rate:

• Improve post-purchase communication: Use order confirmations, product education, and follow-up messages to set expectations and engage customers after checkout
• Collect and act on customer feedback: Surveys and reviews help you discover pain points, and fixing recurring issues can improve retention
• Personalize retention campaigns: Tailor retention emails, SMS, and offers based on purchase history and behavior to make messaging more relevant
• Upgrade customer experiences: Improving delivery, packaging, and first-use experience helps build trust and increases the likelihood of repeat purchases

Key retention marketing metrics

Tracking the right metrics is essential for measuring the success of your retention marketing efforts. Together, these metrics provide a complete picture of customer loyalty, engagement, and long-term business health.

They can also help you identify patterns and evaluate the impact of your retention campaigns. This way, you can make data-driven decisions to strengthen customer loyalty over time.

• Customer retention rate: The percentage of customers who continue to buy over a specific period. You can use the formula we discussed earlier to measure the effectiveness of your retention strategies.
• Customer lifetime value (CLV): This is the total revenue a customer is expected to generate during their relationship with your business. A higher CLV indicates that your retention efforts are successfully driving repeat purchases and customer loyalty.
• Repeat purchase rate: the percentage of customers who make more than one purchase within a given period. It shows whether customers are satisfied with your products and are willing to continue buying. 
• Churn rate: It’s the percentage of customers who stop buying during a specific period. Monitoring churn helps you identify where customers are dropping off and what needs improvement.
• Average order value (AOV): It refers to how much a customer spends in your store per transaction. Effective retention marketing can increase AOV by encouraging repeat purchases or upsells.
• Purchase frequency: This metric tells you how often customers come back to your store. A high purchase frequency drives higher lifetime value and consistent revenue.

Best marketing channels to increase customer retention

Retention marketing works across multiple channels, like email, SMS, and social media. However, the best strategy combines several channels. Below is an overview of six retention marketing channels to increase customer retention.

• Email marketing is one of the most versatile retention channels, enabling brands to nurture relationships through personalized campaigns, product recommendations, and post-purchase messaging. It consistently delivers a high ROI by reaching customers directly and supporting automation across the entire customer lifecycle.
• SMS marketing: It’s highly effective for time-sensitive and personal communication, such as order updates, exclusive offers, and reminders. It has high open and response rates, helping brands stay top of mind and drive quick actions like purchasing or claiming an offer.
• Push notifications: They enable real-time engagement for app users by delivering timely messages based on behavior, location, or preferences. You can use them for reminders, promotions, and updates that encourage immediate interaction.
• Social media: It supports retention by building a sense of community and keeping customers engaged after the first purchase. Brands can maintain ongoing conversations and reinforce brand loyalty through organic content, comments, and direct messages.
• Loyalty programs: You can incentivize repeat purchases by rewarding customers with points, discounts, or exclusive perks. When well structured, they increase engagement, purchase frequency, and long-term retention.
• On-site personalization: It improves retention by creating dynamic website experiences tailored to each visitor. Personalized product recommendations, content, and offers help returning customers find value faster and encourage repeat purchases.

The above mentioned report also highlights why retention-friendly channels and triggers are pulling ahead: automations made up just 2% of email sends but drove 30% of revenue, earning 16× more per send than scheduled campaigns by hitting high-intent moments. And on the “direct line” channels, SMS click rates more than doubled YoY, while push automation conversion rates reached 22.9% — strong support for an email + SMS + push retention mix.

The next sections explore specific strategies for using each retention marketing channel effectively.

Best retention marketing strategies

While every retention marketing strategy aims to keep customers, effective ones go beyond basic reminders. They engage people on a personal level, based on their needs and buying behavior. Rather than relying on one-off campaigns, these proven approaches help you build ongoing relationships that drive repeat purchases and long-term value.

If you prefer a quick visual refresher, here’s a short Omnisend Academy video you can watch in under a minute to reinforce the core retention mindset before you implement the strategies below:

1. Personalized communication and engagement

Personalized communication delivers relevant content based on purchase history, browsing behavior, and engagement signals. This approach works because customers are more likely to respond to messages that feel relevant to their interests.

Personalization thrives on behavioral segmentation, which makes it easier to identify loyal customers and reward them appropriately. When messaging is tailored to where customers are in the ecommerce lifecycle, you build relevance and drive long-term engagement.

Actionable tactics:

• Segment customers by purchase frequency, product categories, and engagement level
• Send automated product recommendations based on browsing and past purchases
• Customize email content, offers, and timing to match individual preferences
• Use an email marketing funnel to target customers at different stages, such as first-time buyers, repeat customers, and VIPs

2. Post-purchase messaging and follow-ups

Staying in touch with customers after they’ve made a purchase is essential for both first-time buyers and repeat customers. It creates natural opportunities for additional sales, feedback, and trust-building.

Relevant follow-ups, such as a thank-you message or product usage tips, reinforce the value of the purchase. Also, sending automated messages, such as order and shipping confirmations, as shown below, allows you to suggest complementary products that can drive repeat purchases.

Actionable tactics:

• Send order confirmation and shipping update emails so customers know when to expect products
• Request product reviews and feedback to build trust and social proof
• Recommend complementary or related products based on the original purchase
• Set up replenishment reminders for consumable or frequently reordered products

3. Loyalty and referral programs

Loyalty programs are designed to reward repeat purchases while creating a stronger emotional connection with the brand. Customers are more likely to stay engaged when you reward them for being loyal. And referral programs add an extra growth lever by bringing in high-quality new customers through trusted recommendations.

When customers understand your loyalty and referral programs, it becomes easier for them to participate and deliver real value. Combining rewards with exclusivity helps customers feel appreciated and motivated to continue shopping with your brand.

In the example below, Beverly Hills Boutique itemizes its rewards for customers based on their annual spend. The difference between each tier can motivate customers to increase spending and earn more rewards:

Actionable tactics:

• Offer points-based rewards that customers can earn and redeem for discounts or perks
• Create tiered VIP programs (such as Bronze, Silver, and Gold) with increasing benefits
• Incentivize referrals with rewards for both the referrer and the new customer
• Provide exclusive access to sales, new product launches, or special bonuses

4. Email and SMS automation

With automated text messages and emails, your brand can deliver timely, consistent communication to a large audience without manual sends. Automated workflows are built to respond to real-time customer actions, helping your business save time and resources.

When messages are triggered based on customer behavior and lifecycle events, customers are engaged at every stage of their journey. This ensures that no opportunity, before or after a purchase, is missed.

Actionable tactics:

• Set up a welcome email series to onboard new customers and set expectations
• Automate birthday and anniversary messages with exclusive offers
• Create browse and cart abandonment workflows to recover lost sales
• Schedule post-purchase follow-up sequences to encourage repeat purchases

5. Winback campaigns for inactive customers

When customers haven’t purchased in a while, they may be at risk of losing interest. However, a winback email can help you re-engage them. It’s cost-effective and faster than acquiring new ones, especially since these customers already know your brand.

When timed correctly, winback campaigns can reignite interest and bring customers back into your active ecommerce lifecycle. You need to identify the right reactivation window based on how often customers typically purchase.

Actionable tactics:

• Send “we miss you” emails after 30–90 days of inactivity, adjusted to your purchase cycle
• Offer special comeback discounts or exclusive incentives
• Ask customers for feedback on why they stopped purchasing
• Remind customers of unused loyalty points or rewards they’ve earned

6. Customer feedback and reviews

Collecting feedback and reviews helps you understand how customers truly feel about your products and their experiences. When you act on those opinions, customers feel heard and valued. As a result, they’re more likely to stay loyal and continue buying from your brand.

Additionally, customers’ opinions give you direct insights into what’s working and what needs improvement. It makes it easier to optimize products, services, messaging, and the customer experience.

Actionable tactics:

• Request product reviews and ratings shortly after delivery
• Send post-purchase satisfaction surveys to gather experience feedback
• Use NPS (Net Promoter Score) surveys to measure customer loyalty
• Close the feedback loop by sharing improvements made based on customer input

7. Omnichannel customer support

Customers expect to reach your brand through their preferred channels and receive fast responses every time. This is important because responsive and reliable support builds trust, reduces frustration, and directly impacts whether customers return.

When support is easy to access and expectations are clear, customers can confidently buy again from your brand. Exceptional customer service also helps differentiate your brand from competitors and strengthens long-term customer relationships.

Actionable tactics:

• Offer multiple contact options such as email, live chat, phone, and social media
• Maintain consistent service quality and tone across all support channels
• Respond quickly and set clear expectations for response times
• Provide self-service resources like FAQ pages and knowledge bases

8. Analyze customer data and track key metrics

Tracking retention metrics helps you understand which strategies are working and which customers may be at risk of churning. This approach allows you to optimize campaigns based on real customer behavior rather than assumptions.

With consistent performance monitoring, you can identify challenges early and adjust your retention strategies before issues escalate. We’ve covered the key metrics you should track in the previous section. 

Actionable tactics:

• Monitor customer retention rate, repeat purchase rate, and customer lifetime value regularly
• Segment customers using RFM analysis (Recency, Frequency, Monetary value)
• Identify customers at risk of churning based on declining engagement or purchase activity
• A/B test retention campaigns and optimize messaging, timing, and offers based on performance data

Retention marketing strategies are effective when they work together, not in isolation. Start by implementing two or three tactics that align with your business model, purchase cycle, and customer behavior. Then expand as you gain insights from your data.

Customer retention case studies and examples

These customer retention examples from Omnisend showcase how real ecommerce brands successfully used retention marketing to achieve measurable results. You can draw inspiration from these stories and adapt similar strategies to increase engagement and retention in your own business.

Inglot Canada: Driving repeat purchases with email automation

Inglot Canada is a high-end cosmetics and beauty brand. Despite being a global brand, it struggled to connect its online store data with its physical retail locations to grow ecommerce sales. 

To tackle this, Inglot implemented Omnisend’s email automation to deliver value-packed promotional emails. It also relied on customer purchase history to send relevant product offers and recommendations.

Later, the brand combined SMS and push notifications for its cart abandonment workflow. Customers who left items in their cart received a combination of email, SMS, and push notifications to capture them while they were still in a “shopping mood.”

The SMS and email combination resulted in a 2130% increase in revenue per message. There was also a 4798% increase in revenue-per-message for abandoned cart push messages. Overall, the automated workflow accounted for a 117% increase in conversion rates and 8% of annual email revenue.

Inglot proved that retention marketing isn’t centered around emails. You need to use data to meet customers on their preferred channels and when they’re ready to make a buying decision. 

Rachel Riley: Driving customer loyalty through personalized campaigns

Rachel Riley, an award-winning British children’s clothing brand known for its traditional craftsmanship, faced the challenge of modernizing its marketing to meet the expectations of today’s shoppers.

The brand shifted to a customer lifecycle marketing strategy using Omnisend. This ensured its emails met customers at each stage of their journey. 

The brand used Omnisend’s welcome series, order confirmations, abandonment workflows, reactivation, and personalized thank-you messages. These automations helped the brand understand customers’ needs, building loyalty and retention.  

Rachel Riley also adopted Omnisend’s omnichannel marketing. It used SMS (which became a massive sales driver in the USA) and push notifications to engage its growing subscriber list.

These efforts paid off, as 46% of all revenue driven by Omnisend came from automated workflows. Also, during the peak Black Friday Cyber Monday (BFCM) period, personalized retention marketing efforts accounted for 48% of total store revenue. The brand’s yearly revenue from Omnisend increased by 77%.

Rachel Riley’s success shows that retention is related to the relevance of your marketing messages. By using automation to send the right message at the right time, you can turn one-time buyers into loyal customers.

Pasignias: Scaling retention with email and SMS marketing

Pasignia (Passion + Insignia) is a unique brand that creates premium hand-casting kits for capturing memories in 3D. While its product was deeply personal and emotional, its marketing was stuck. It was missing out on revenue because it wasn’t effectively re-engaging customers.

Through a partnership with Ecommerce Boost, Pasignia migrated to Omnisend and rebuilt its retention marketing strategy. It activated email automation for welcome series, abandoned cart, post-purchase, milestone reminders, and re-engagement emails.

The brand also combined SMS and push notifications to coordinate campaigns. While emails were used for storytelling and detailed instructions, SMS and push messages were used for high-urgency updates.

Pasignia started segmenting its audience into VIPs, repeat buyers, and first-time shoppers. This ensured the message matched the customer’s buying journey.

This shift helped Pasignia launch campaigns 50% faster, saving them thousands on platform fees. Revenue from automated flows and campaigns increased by more than 25%. The brand recorded an average open rate of 55%, demonstrating that its segmented, omnichannel approach was resonating with customers.

When Pasignia layered its marketing with SMS and push notifications, it captured revenue that had previously been left on the table by relying solely on email. This proves that retention scales when you use a combination of channels. 

Retention marketing best practices

Following proven retention marketing best practices helps you get more value from every customer interaction. It also maximizes the impact of your retention efforts. The following tips apply across all retention strategies and channels:

• Segment your audience by behavior and purchase history: Grouping customers by what they buy and how they interact with your brand enables you to send personalized content. When your messaging aligns with their specific interests, open and click-through rates naturally skyrocket.

• Automate key retention touchpoints: Use automated workflows to reach customers at critical moments, such as immediately after a purchase or when they haven’t visited in 30 days. Automation ensures no customer slips through the cracks, providing a consistent experience without manual effort.
• Personalize beyond just using names: Move past “Hi [Name]” by tailoring product recommendations and content based on a customer’s lifecycle stage. True personalization makes a customer feel seen and understood, which is the foundation of brand loyalty.
• Monitor and track key retention metrics regularly: You can’t improve what you don’t measure, so keep a close eye on churn rate, CLV, and repeat purchase rate. Consistent tracking helps you identify which parts of your strategy are working and where you’re losing people.
• Test and optimize your campaigns continuously: Use A/B testing for everything from subject lines to send times and offer types. Small, data-driven tweaks over time can lead to massive improvements in your overall conversion rates.
• Craft compelling subject lines and preheaders: Your subject line can determine whether subscribers will open your message. Use curiosity, urgency, or clear value propositions to encourage that first click.
• Make it easy for customers to repurchase: Include “Buy it Again” buttons in emails or offer one-click checkout options. The easier it is for a customer to complete a transaction, the more likely they are to return.
• Provide consistent value, not just promotions: If every message is a sales pitch, customers will eventually tune you out. Balance your offers with educational content or “insider” information that rewards them for staying subscribed.

• Reward loyalty and recognize milestones: Acknowledge customer anniversaries or birthday milestones with a special note or offer. These small gestures build an emotional connection.
• Act on customer feedback and close the loop: When you collect surveys, show your customers that their opinions actually drive change in your business. As they see their feedback in action, they’ll feel like partners in your brand’s success.
• Use a multi-channel approach: Meet your customers where they are by blending email, SMS marketing, and push notifications. A coordinated omnichannel strategy ensures your message is seen on the platform customers prefer most.

• Time your messages strategically: Use data to determine when your specific audience is most likely to engage, whether that’s Tuesday mornings or Sunday nights. Proper timing ensures your brand appears at the top of the inbox.

Elevate your retention marketing strategy

Retention marketing is one of the most effective ways to drive sustainable growth. It turns first-time buyers into loyal, repeat customers. With an in-depth understanding of retention rates and by applying best practices such as personalization, automation, and omnichannel support, you can increase customer lifetime value.

However, the results only come when you take action. Start by implementing two or three retention tactics that align with your business model and customer behavior. Make sure to focus on consistently delivering value. 

Marketing automation platforms like Omnisend make retention marketing more accessible and effective. They provide pre-built automation workflows, advanced segmentation, and multi-channel capabilities across email and SMS. Using such platforms can help you turn retention strategies into measurable results.

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