When “Customer Retention” Undermines Customer Relationships

helen • February 20, 2026

This week I experienced something that perfectly illustrates the gap between marketing strategy and customer experience.


I was contacted by a business claiming to be acting on behalf of a car dealership I’ve used for years. The caller was enthusiastic but spoke so quickly I had to ask several times for the company name. When I asked how they were connected to the dealership, I was told they had supplied their software and were “helping with retention and customer management.”


Let that sink in.


As someone who understands exactly what that means from a marketing perspective, I knew what was happening. But as a customer? It didn’t feel good.


Over the past decade I’ve sourced three cars from this dealership. Two of those vehicles were through the same junior sales team member who delivered exceptional service. I felt known. I felt valued. I felt like a customer, not a data point.


I’m aware that team members move on. That’s business. But if there was a change in personnel, surely the right approach would have been for his successor to pick up the phone and introduce themselves? To build on the existing relationship?


Instead, my details were passed to a third-party telemarketing company, despite my preferences stating no third-party contact.


When I queried this, the new junior sales team member confirmed my profile had no third-party contact ticked. The dealership manager did call to apologise, but unfortunately the explanation focused on why it “didn’t count” rather than acknowledging how it felt from a customer’s perspective.


And that’s the real issue.


From a compliance point of view, they may believe they were covered. From a systems point of view, the data may have been processed correctly. From a marketing automation point of view, the retention journey may have been triggered exactly as designed.


But from a human point of view? The relationship was damaged.


What makes this particularly significant is timing. This year falls within the typical lifecycle of when I would consider changing my car. Previously, I wouldn’t have looked elsewhere. Now, I will.


  • Not because of price.
  • Not because of product.
  • But because of experience.
  • Retention isn’t software.
  • Customer management isn’t automation.
  • Loyalty isn’t a CRM workflow.


Good marketing should enhance relationships, not replace them.


When businesses outsource “retention” without safeguarding the emotional connection, they risk losing the very customers they’re trying to keep.


Customer service and marketing are not separate departments. They are the same conversation.  And when that conversation changes tone, customers notice.

 

Data, GDPR and Brand Trust: The Bit Businesses Can’t Ignore


Beyond the customer experience, there’s a deeper issue here: trust.


Under the General Data Protection Regulation (GDPR) and the Data Protection Act 2018, businesses must have a lawful basis for processing personal data. That includes how data is shared with third parties.


But compliance isn’t just about ticking a legal box. It’s about honouring the expectations you set with your customers.


If a customer has actively chosen “no third-party contact,” that preference isn’t a grey area. It’s a clear signal about boundaries.


Even if a business believes a third party is acting as a “processor” rather than a separate marketing entity, the perception from the customer is simple: “My data has been passed on without my consent.”


And perception shapes trust.


Brand trust is fragile. Customers are more aware than ever of how their data is used. When organisations blur the lines between internal communication and outsourced contact, they don’t just risk compliance scrutiny, they risk reputation damage.


The irony? Many businesses invest heavily in marketing to acquire new customers, while unintentionally eroding loyalty with the ones they already have.


Data strategy, customer experience and brand positioning must align. Because when trust is compromised, the cost isn’t just regulatory, it’s relational.


And relationships are far harder to win back than they are to protect in the first place.

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