Customer Retention vs Customer Loyalty: What’s the Difference?

Explore the differences between these two widely used terms to enable real retention value.

However, both terms actually carry different meanings. In this article, we explain and demonstrate some examples to help you understand customer retention and customer loyalty better.

The key difference between customer retention and customer retention is that customer retention retains existing customers; while customer loyalty customer loyalty involves strengthening relationships with customers.

Customer retention is a metric that is based on the likelihood that existing customers will continue to use your products or services even if they are not interested in the brand or are not completely satisfied.

Meanwhile, customer loyalty is more closely related to a customer’s actions. It is the likelihood that customers will choose your brand over and again despite being lured by your competitors. In loyalty, customers are also more likely to engage and voluntarily promote your business.

Here’s another way to think of it. Customer retention is the act of customers returning to your business. In order to get customers back, you need to convert them into loyal customers.

By distinguishing retention from loyalty, you can begin to understand the customer experience, interactions, perceptions, and attitudes that drive and influence loyalty.

Although they are different, customer retention and customer loyalty definitely tie to each other. By understanding and investing in customer loyalty, you can increase your customer retention rate – which means more customers for your business. This is essential in growing your business and profits.

Why is this important?

Understanding customer loyalty is key to increasing the number of customers that a business has. Studying customers and their behaviour can help your business tailor a suitable customer loyalty program that hooks customers in.

From there on, you can come up with various ideas and methods to engage with customers and nurture them into loyal customers. Loyal customers tend to stay longer, spend more, and talk more about your business.

Loyalty programs are an element of a loyalty program aimed not only at retaining customers, but also at increasing their value. Well-designed loyalty programs will encourage habits that benefit the customer and the company.

83% of the customers themselves agree that loyalty programs are what makes them keep buying from a particular brand.


In addition to increasing your overall income, loyalty is ideal as your customers become influencers or advocates for your business.

Becoming a loyal brand advocate means these customers are promoting your business for free. Loyal customers are more likely to vouch for your business and become brand advocates.

At Eber, we specialize in helping our customers boost customer loyalty and retention and turn customers into ambassadors for their brand. If you want to find out more, then get in touch today to find out how.