Customer Retention Statistics 2026: Rates by Industry and the Cost of a Lost Customer

The numbers in one table

Retention is the share of customers you keep over a set time. The set time changes the number. Gyms count a year. Dental offices count 18 months. Apartment managers count leases that expire. Compare your rate only with a rate that uses the same window.

Read the table for direction. Each row names who measured it and when. Sources that publish no sample size or method are marked in the sections below.

• 39%of annual revenue from repeat customers, 1,015 residential contractors, 2022 dataServiceTitan, 2023
• 44%of online store revenue from repeat buyers, who are 21% of customers (vendor data)Gorgias
• 66.4%average annual member retention, 175 fitness companiesHealth & Fitness Association, 2025
• 47%of bad experiences lead customers to cut spendingQualtrics, 2026

What is the average customer retention rate by industry?

There is no honest single average. Pages that quote one, usually near 75 percent, compile rows from different studies with different windows. The Focus Digital list shows a 2026 table by industry and links Statista, CustomerGauge and Shopify, but it shows no sample or method of its own (Focus Digital, 2026).

We list the rows that name who measured, how many and when. Apartment renewals sit at 55.1 percent in the year to June 2025 (RealPage). Fitness members stay at 66.4 percent across 175 companies and more than 17,000 facilities (Health & Fitness Association, 2025). Solo dental practices keep 70 percent of active patients over 18 months, and the top 10 percent keep 94 percent (Henry Schein One, 2026).

Business buyers stay longer. CustomerGauge lists median B2B retention from 44 percent in wholesale to 89 percent in energy and utilities, with an average of 72.5 percent. The page shows no sample size, so treat it as a rough guide (CustomerGauge, 2026).

Private B2B software firms keep 88 percent of starting revenue before upsells (gross revenue retention) and 101 percent with upsells (net revenue retention) in 2024 data (Benchmarkit and Pavilion, 2025). That is software, not your trade.

Retail is much lower. Across seven retail categories, 27.4 percent of customers came back, from 19.1 percent for jewelry to 41.2 percent for health and beauty (Bluecore, 2025, as published by Shopify). Shopify did not collect that data and the page shows no method.

Published trade retention figures come from vendors and name no study. Pest control operators were asked in the 2025 State of the Industry survey, and 96 percent expect to keep more than 75 percent of customers. That is an expectation, not a measured rate (Pest Management Professional). Vendor pages publish second-job retention figures for HVAC and plumbing but name no study, so they are not used here.

How much revenue comes from repeat customers?

More than a third of revenue in the data we found. Repeat customers brought 39 percent of annual revenue and 58 percent of the work at residential contractors in 2022 (ServiceTitan, 1,015 contractors, 2023 report).

Online stores show the same shape. Repeat buyers are 21 percent of customers and bring 44 percent of revenue and 46 percent of orders (Gorgias, 12,000+ merchants). A survey of 100 stores in July 2025 found 40.9 percent of revenue from returning customers, but it shows no method (ThoughtMetric).

The share depends on what people buy. A study of 156,110 customers at direct-to-consumer brands found repeat buyers were 18.8 percent of customers and 19.6 percent of revenue overall. For top consumable brands the repeat rate was 44 percent and repeat revenue 66.5 percent. For fashion it was 15 to 17 percent and 13 to 19 percent (BS&Co, 2026).

In a salon or spa, frequency decides it. Clients who visit more than once a year are 42 percent of clients and bring 80 percent of revenue (Zenoti, 2025 report, 2024 data). In 2024, visits from existing guests rose 1 percent while visits from new guests fell 9 percent.

For an owner, the point is the base. If 40 percent of your revenue is already repeat revenue, a drop of a few points in retention costs you more than a drop of a few points in new leads. Check the split before you move budget.

• 58%of completed work comes from repeat customers, residential contractorsServiceTitan, 2023
• 71%of business volume came from word-of-mouth referrals, 2022 dataServiceTitan, 2023
• 80%of salon and spa revenue comes from clients who visit more than once a yearZenoti, 2025
• 66.5%of revenue from repeat buyers at top consumable brands, 44% repeat rateBS&Co, 2026

Do the famous retention numbers hold up?

Two numbers sit on almost every retention page. Acquiring a new customer costs 5 to 25 times more than keeping one. A 5 percent rise in retention lifts profit 25 to 95 percent. We traced both.

The profit claim starts in a 1990 Harvard Business Review article by Frederick Reichheld and W. Earl Sasser. The HBR abstract page shows no figures. One analysis of the article finds a range of 25 to 85 percent, built on three service examples with no published method (Icaro Iasbeck). The "5 percent" means 5 points less yearly defection, for example 10 percent down to 5 percent. That is a halving. The Ehrenberg-Bass marketing science site calls the work a thought experiment, assumes the halving costs nothing, and notes it measured customer profit, not company profit.

The 95 percent top end appears, in the earliest copy that analysis traced, in a 2000 article by Reichheld and Phil Schefter about online retailers, with no reason given. Bain's own 2001 brief by Reichheld is narrower. It says that in financial services a 5 percent rise in retention produces more than a 25 percent rise in profit, and it shows no data. Amy Gallo's 2014 Harvard Business Review article then gave the 25 to 95 percent range to Bain without naming a study.

The cost claim has no study. Gallo (2014) wrote that acquiring is "anywhere from five to 25 times" more expensive, "depending on which study you believe," and named none. Breme traces "five times" to late-1980s customer-service research that later appeared in a 1990 Harvard Business Review article by Hart, Heskett and Sasser, "The Profitable Art of Service Recovery." It found no study behind it and nothing for 25 times.

How much weight should you give them? Use the direction and drop the multiplier. Keeping a customer is often cheaper than winning one. The size of the gap depends on your trade, and neither ratio was measured on businesses like yours.

The measured data is smaller and more careful. In 2024 the median private software company spent $2.00 of sales and marketing to win $1.00 of new customer revenue, and the weakest quarter of companies spent $2.82 (Benchmarkit and Pavilion, 73 companies). Fewer than half of the companies that track that ratio also calculate the same ratio for existing customers, so most cannot compare the two.

Older studies add caution. Reinartz and Kumar (Harvard Business Review, 2002) studied four companies and more than 16,000 customers and found a weak to moderate link between how long a customer stayed and profit, with correlations of 0.20 to 0.45. Gupta, Lehmann and Stuart (2002 data) modelled five US firms and found a 1 percent gain in retention raised firm value 3 to 7 percent, while a 1 percent gain in acquisition cost moved it 0.02 to 0.3 percent. Both are pre-2020 and the second is a valuation model, not a test. Both are reported second-hand by Breme.

What does a lost customer cost?

The cost has two parts. You lose the revenue the customer would have brought. You also spend money to replace them. The replacement cost differs by trade, so measure your own.

Here is a worked example, not a study. A service business has 1,000 customers who each spend $1,200 a year. At the home services average of 40 percent annual churn (Arch, Q4 2025), it loses 400 customers and $480,000 of yearly revenue. At 15 percent it loses 150 customers and $180,000. The gap is $300,000 a year, before any ad spend to refill the list.

A bad experience is the best-measured trigger. In the Qualtrics Q3 2025 study of more than 20,000 people in 14 countries, 11 percent of experiences were bad, and 47 percent of those led the customer to cut spending. Qualtrics puts 2026 sales at risk at $2.94 trillion worldwide and $973 billion in the US.

Price is not the only reason people leave. In the 2023 Salesforce study of 14,300 consumers and business buyers in 25 countries, a better deal was the top reason for switching across every generation. Treat that as one driver, not the whole answer.

Why do customers leave?

Most do not announce it. They stop calling, or they shop around once and switch. In 2025, 57 percent of auto insurance customers shopped for coverage and 29 percent of insurance customers switched insurers (J.D. Power, as reported in 2026). Only 51 percent of high-value insurance customers, the loyal ones who bundle products, said they will definitely renew.

In home services, the frustrations are about money and time. In a 2025 survey of 1,040 US homeowners, 77 percent were frustrated by hidden costs and 35 percent by late arrivals. More than 70 percent said they would pay more for a company with a better service reputation (Housecall Pro, 2025). The report says most service frustrations relate to communication rather than quality.

Good news sits beside the bad. Sixty-eight percent of those homeowners say they would hire the same company again, and 73 percent would refer a pro after an excellent experience. The base is there. The gap is in what happens after the job.

Younger buyers move more. Among Gen Z, 59 percent switched brands in the past year (Salesforce, 2023). If your customer base is getting younger, plan for lower loyalty by default.

• 57%of auto insurance customers shopped for coverage in 2025, up from 49%J.D. Power, 2026
• 77%of homeowners are frustrated by hidden costs, 1,040 surveyedHousecall Pro, 2025
• 68%of homeowners would hire the same company againHousecall Pro, 2025
• 59%of Gen Z switched brands in the past yearSalesforce, 2023

What drives repeat buying: follow-up, reviews and service plans?

Three drivers have data behind them. A next step booked early, a simple reminder, and a service plan or membership.

Book the next step early. In salons, the top 10 percent rebook 30 percent of clients within 24 hours. The average salon rebooks 10 percent. In medspas it is 69 percent against 40 percent (Zenoti, 2025). Spas with memberships rebook 33 percent within 24 hours on average against 12 percent without. Guests in loyalty programs make 9 percent more visits a year.

Send a plain reminder. In a 2012 field experiment at a dental practice, the share of patients booking a check-up within a month more than doubled after a reminder postcard. It is pre-2020 and covers one practice, but people respond to a prompt now as they did then (IZA, 2012). Our full playbook is in how to get repeat customers and the cadence behind it is in sales follow-up statistics.

Ask for the review at the right time. A study on a travel site sent a review reminder on different days. A reminder the next day got reviews from 6.32 percent of customers inside a week, against 12 percent with no reminder. A reminder on day 13 beat no reminder (Arizona State University, 2023). Wait about two weeks.

Reviews shape who chooses you next. Forty-two percent of consumers trust online reviews as much as personal recommendations, down from 79 percent in 2020, and 74 percent use two or more review sites (BrightLocal, 2025). Answer reviews to show the next customer how you treat the last one.

Service plans are the data gap. Published maintenance-plan figures come from vendors. Their pages quote renewals of 80 to 96 percent and name no study. The membership gap in spas (33 against 12 percent) is the closest measured proof that a standing plan lifts the next visit.

• Referrals follow service. 73 percent of homeowners would refer a pro after an excellent experience (Housecall Pro, 2025).
• Word of mouth carries the trades. 71 percent of contractor business volume came from referrals in 2022 (ServiceTitan, 2023).
• Existing clients are growing while new ones shrink. In 2024, existing guest visits rose 1 percent and new guest visits fell 9 percent in the Zenoti data.

What do retention and repeat rates look like in B2B, software, retail and restaurants?

The first table adds rows that the sections above do not carry. Read each row inside its own sector. A software renewal and a restaurant visit are not the same event.

Three patterns show up. B2B retention falls as the work gets more transactional. Software retention rises with contract size and with usage-based pricing. In retail and restaurants, repeat rates are low until a second purchase or a loyalty sign-up changes the habit.

In software, expansion now carries growth. The median share of new revenue that comes from existing customers is 40 percent, up 5 points, and above 50 percent at companies over $50M in revenue (Benchmarkit and Pavilion, 2025). Keeping a customer and growing them is the same job there.

What else moves repeat buying in service businesses?

These rows add detail on rebooking, memberships, gift cards and reviews. They come from salons, spas and local consumers, the closest measured data for appointment-based services.

Gift cards and memberships bring in new people as well as repeat ones. Nearly a quarter of salon gift cards were redeemed by new customers, and membership sales grew by about a quarter in 2024 (Zenoti, 2025). Both are ways to book the next visit before the first one ends.

How do you measure your own retention rate?

Use one formula and one window, then keep both. The window should match how often your customers buy. A gym counts a year. A dental office counts 18 months. A plumber with a two-year gap between jobs needs a longer window than a lawn service.

The software benchmark study recommends the cohort method. Take the customers you had at the start of the period. Count how many are still customers at the end. Ignore new customers. That gives retention without the noise of new sales (Benchmarkit and Pavilion, 2025).

For revenue, use the same cohort. Divide the revenue those customers bring now by the revenue they brought at the start. A result above 100 percent means upsells outweigh the customers you lost. In 2024 the median was 101 percent in private B2B software.

Do not mix your rate with a benchmark that uses another window. If you cannot find a benchmark for your window, compare your own rate across quarters. A falling trend is the signal.

1. Pick the window: the time between your normal purchases.
2. List the customers at the start of the window.
3. Count how many bought again inside the window.
4. Divide the second number by the first. That is your retention rate.
5. Repeat the count each quarter and write the trend down.

What to check this week

You need one export and one hour. The aim is a number you can compare with the rows above, and a list of customers to call.