Customer retention refers to the strategies and actions a business takes to maintain and grow its relationship with existing customers over time. Retaining customers is crucial because it is often more cost-effective than acquiring new ones, and loyal customers tend to make repeat purchases, advocate for the brand, and contribute to long-term revenue. Effective customer retention involves understanding customer needs, providing excellent customer service, offering loyalty programs, and continuously engaging customers through personalized communication. High retention rates indicate customer satisfaction and loyalty, which are essential for the sustained success and growth of any business.