Average Customer Retention Rate by Industry (2026)

Bringing in new customers is important to any business, but keeping the ones you already have is key to growth. That’s why it’s important to track customer retention rate, which is the percentage of customers who continue doing business with your company over a period of time. 

Retaining customers can also drive sales. Bluecore’s 2025 Customer Growth Benchmarks Report shows repeat buyers both order and spend significantly more than new customers across retailers. Once someone buys twice, they’re also 95% more likely to buy again.

In this article, we’ll dive into the average customer retention rates by industry so you can compare how your customer retention metrics stack up against your competitors.

What is the average customer retention rate by industry?

Bluecore tracked customer retention rate across seven retail verticals and found the total rate to be 27.4%. Here’s a breakdown of the data:

How to calculate customer retention rate

If you haven’t yet identified your business’s customer retention rate, you can use the following formula to do so: 

Customer retention rate = [(Customers at the end of the period – Customers acquired during the period) / Customers at the start of the period] x 100

Let’s say you own an online houseplant store and want to determine your retention rate over a six-month period. At the beginning of this period, you had 150 customers. By the end, you had 120 customers, having acquired five new customers during these six months. 

Here’s how you’d calculate your retention rate:

[(120 – 5) / 150] x 100 = 76.67%

How to calculate churn rate

Customer churn rate tells you how many customers leave within a certain time. It’s the inverse of retention rate. Combined, they show the full picture of how many customers stay and leave over a specific period.

To calculate churn rate:

(Customers at the start of the period – Customers at the end of the period + New Customers Acquired in the Period) / Customers at the start of the period x 100

For example, if you have 10,000 customers at the start of July, 12,000 at the end of the month, and 2,300 new customers who you acquired throughout, your churn rate would be 3%.

Churn rate can be high for subscription business models. Recurly’s 2026 State of Subscriptions report found 52% of consumers canceled a subscription in the previous 12 months. That said, former subscribers drive almost one in four new sign-ups.

What affects customer retention rates?

Trust, customer service, personalization, convenience, product quality, loyalty programs, and customer experience can all influence whether customers come back.

Attentive’s 2026 report found 88% of customers bought from a new brand in the previous quarter. More than half expect to buy from some of these new-to-them brands again.

Key factors affecting customer retention rate, per Attentive, include:

• Deals and offers. More than half (52%) of shoppers said that deals and promotions were among the most likely reasons to bring them back to shop again with a new brand. 
• Great product quality. This was a driving factor for 45% of shoppers. The inverse is also true: low product quality was likely to turn off 41% of shoppers. 
• Free, fast shipping. Some 38% of shoppers were most likely to make a second purchase if either were on offer. Glamlite recorded higher retention rates after offering fast and affordable international shipping.
• Fair prices. Around 38% of customers were most likely to shop again if the price was fair, while 45% were most likely to turn away if they felt prices were too high for the value they got.
• Customer service. One quarter of shoppers said great customer service was most likely to bring them back to shop with a retailer. 
• Convenience. Easy returns and exchanges were most likely to drive 22% of shoppers back, while easy 16% listed easy shopping experiences.
• Exclusive loyalty offers. About 18% of shoppers said this was most likely to bring them back.
• Personalized product recommendations. Some 11% said they were most likely to come back if a brand recommends products they’d be interested in buying. A similar amount (9%) would return if the brand remembers their preferences and purchase history.

In a 2025 Shopify and Sapio Research holiday shopping survey, 49% of consumers cited discounts as a reason to remain loyal to retailers. Some 41% cited free shipping and/or returns, 29% cited loyalty programs, and 28% cited a great customer experience.

Strategies to improve customer retention rates

Here are a few ideas to consider for your customer retention strategy, regardless of the industry you’re in:

• Ask for customer feedback. Get insight from your customers and provide what they ask for, if you can. “After they give you the money, that’s at the height of trust where you can ask them those additional questions,” says Neil Hoyne, chief strategist for data and measurement at Google, in a Shopify Masters interview.
• Segment customers and personalize content. Unified profiles combine every piece of data you’ve collected on a customer. These profiles can power customer segments inside Shopify, which brands like Beauty Heroes have used to improve customer loyalty and retention. You can use segments to send personalized emails and targeted promotions based on what they’ve bought or shown interest in.
• Consider omnichannel campaigns. Brands using Shopify POS saw up to 61% more repeat purchases from known customers, according to a 2025 Shopify report. Shopify POS lets you offer omnichannel experiences, like retail clienteling and buy online, pickup in-store options.
• Run life cycle email automations. Automate campaigns when customers leave or join a segment, or meet specific criteria, using Shopify Flow. For example, a haircare brand could trigger an automated email 28 days after a customer’s shampoo order has been delivered, a time when their last bottle may be almost empty.
• Improve returns and post-purchase service. A 2025 National Retail Federation (NRF) report found 82% of consumers think free returns are an important consideration when shopping online. Offer self-serve returns with apps like Loop or buy online, return in-store options.
• Design loyalty rewards or perks around what customers value. Use post-purchase feedback to understand what customers want. Build them into a loyalty program using apps like Smile or Apostle. This can be lucrative: Mokobara recorded three times higher sales from loyalty members than non-members after boosting its program with Shopify Plus.
• Use customer reports. Review new versus returning customers reports to benchmark whether your retention strategies are resulting in more repeat shoppers. Sidekick can also answer analytical questions like, “How many customers made their second purchase this month?”