How Does Your Retention Compare?
The more customers you retain, the better. But what is a “good” retention rate in retail energy?
Most energy retailers don’t reveal much about their retention rates. This data tends to be closely guarded. Nevertheless, through our work on retention with so many energy retailers, we’ve developed the following scale:
- 78% or above – The gold standard for retention is an annualized rate of at least 78%. If you’re here, you have a trusted brand and your customers are ready for up-selling. What else do you have for them?
- 70 to 77% – Above 70% is still a very good retention rate. While it can be improved, retention probably isn’t a high priority. You can realize higher gross margins by effectively touching every customer 2-4 times each month. How are you touching your customers?
- 62 to 69% – With retention in the 60s, you’re in the middle of the pack. You can get a great return by making a small investment in increasing retention–and also realize higher gross margins. Do you have the tools to increase retention inexpensively?
- 55% to 61% – Below 61%, retention is a major opportunity. With modest investment you can dramatically improve retention, and grow your customer count much faster–without necessarily having the lowest prices. Most iMPACT™ clients started at this level, and moved up. Is your retention in need of attention?
- Below 55% – Yikes! Retention this low is probably the main limitation on your business. We’ve helped clients dramatically improve poor retention, enabling them to grow significantly. Can we help you, too?
Even for strong brands, iMPACT Retention™ works. It has improved retention rates between 6 and 20 percentage points at most clients. That’s why iMPACT™ routinely creates an ROI of 50-100% within the first year.
Learn more from our iMPACT™ case studies.