What Is the Connection between Customer Satisfaction and Retention?

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  • Written By: Jacob Queen
  • Edited By: Lauren Fritsky
  • Last Modified Date: 30 October 2018
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Customer satisfaction and retention are intrinsically connected because a customer’s loyalty is usually based mostly on how the person feels about a company and its products. Many companies spend a lot of time and money trying to maintain as much customer satisfaction as possible because losing customers to a competitor is one of the most dangerous things that can happen in business. There are many approaches to cultivating customer satisfaction, and the method used will often vary depending on the exact type of business in question, and the company’s previous history of operation. Customers who are truly dissatisfied can sometimes become hostile, which can lead to negative word-of-mouth issues, possibly resulting in a multitude of people who have a bad opinion about a company.


If a customer buys a product and feels generally happy with it, he or she could be considered “satisfied” with the company, but that isn’t the same as being truly loyal. People who become loyal to a company will actually put up with a lot of problems because they often feel like they are part of the company’s team, and they will actively support the company even during troubled times. Many companies consider the process of creating customers with real brand loyalty to be an important part of their business model, and it is one of the most crucial aspects of the customer satisfaction and retention equation. Customers with this kind of loyalty could generally be considered the safest customers, and they also usually lead to very positive word of mouth.

In order to maximize customer satisfaction and retention, companies often come at the issue from several different angles. On the one hand, there is the simple process of providing the best possible product or service and making sure that the overall quality standards for the company are held at the highest possible level. Another important aspect of customer satisfaction and retention is the way people are treated when dealing with company representatives, and for this reason, many companies spend a lot of time improving the customer relation skills of phone-operators and other people who work with the public.

According to some experts, the most important goal when it comes to customer satisfaction and retention is usually damage control. If one thing goes wrong and a customer becomes hostile, that person can do enormous damage all by himself, simply by telling his friends and acquaintances about his bad experience. Sometimes this sort of scenario isn’t entirely avoidable, but many companies expend a lot of effort trying to mitigate the potential for these problems as much as possible by offering no-strings-attached return policies and things like that.



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