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By Matthew Stern
Chief Growth Officer
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Artificial intelligence (AI) can now help a company find its next customer in seconds. It cannot guarantee that the customer will come back.
Yet businesses are pouring money into automated advertising while treating loyalty as a problem to solve after the sale, a strategic mistake that will become increasingly costly as AI lowers some of the barriers to launching and marketing competing products.
I spent the first 18 years of my career playing the acquisition game. I bought traffic, tracked media costs against customer lifetime value, and measured success by how much revenue each dollar of advertising generated.
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It was a rational way to run a business, and it was how the industry operated.
Over the past two or three years, however, my thinking has changed. I have come to believe that a transaction is the beginning of a customer relationship, and the quality of that relationship determines whether the original investment was worth making.
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The advertising industry is becoming extraordinarily efficient at getting people through the door. Google has expanded its AI-powered advertising tools, while platforms such as Meta automate audience targeting and campaign optimization.
These tools can help businesses reach customers at unprecedented speed. Yet there is a fundamental question executives should ask themselves.
If a company must keep paying to bring customers back, how much of its growth has it actually earned?
The latest marketing data suggests this imbalance deserves serious attention.
A 2026 Gartner survey of 401 marketing leaders, predominantly from large organizations, found that awareness and conversion accounted for 62.6 percent of media spending.
Meanwhile, the share allocated to customer loyalty and retention had fallen 29 percent since 2024, to less than 15 percent.
The industry is directing enormous resources toward winning attention while devoting a shrinking share to keeping the customers it acquires.
An Expensive Exercise
The financial implications are significant. A company can report rising sales while its underlying economics deteriorate.
If every incremental dollar of revenue requires another dollar of advertising, growth becomes an expensive exercise in replacing customers who have already left.
A business may look successful on a quarterly earnings report while becoming vulnerable to a competitor’s aggressive campaign or an algorithm change that suddenly makes its audience more expensive to reach.
I think of this as building a business on a stool with one leg. Paid acquisition may hold it upright for a while, especially during a strong advertising cycle.
Eventually, competition intensifies, costs rise, and the company discovers how little support its other legs provide. The pressure becomes particularly acute during peak shopping periods, when advertisers compete fiercely for limited consumer attention.
The real test of growth is what happens after the purchase.
I saw the alternative firsthand while building my telehealth business, which later merged with Direct Meds.
In the early days, I personally contacted customers who raised complaints or left reviews below five stars. I wanted to understand their experience and make sure they felt supported.
Two and a half years later, some of those customers still have my cellphone number. They message me with updates, thank me for the service, and recommend the platform to family members.
One customer recently told me he had brought his brother onto the program and was excited to recommend it to a friend.
The Importance of Loyalty
That is where loyalty stops being a branding exercise and becomes a growth strategy. A customer who returns, purchases additional services, and brings others with them creates economic value that an isolated click cannot.
In subscription models, those behaviors can compound into recurring revenue and more efficient acquisition over time. The financials should eventually show the difference through stronger retention, more organic traffic, and a growing share of customers arriving through referrals.
For smaller businesses, investing in loyalty can sound like a luxury reserved for companies with substantial budgets. I understand that objection because every dollar matters when a business is getting started.
Yet customer relationships do not require an enormous advertising budget. They require time, responsiveness, and a genuine commitment to solving problems.
Entrepreneurs can publish useful content, contact customers personally, and use AI to scale individualized follow-ups without losing the human intent behind them.
This is also where the future of AI-powered commerce could split in two. In the optimistic version, automation gives businesses more time to understand customers, improve service, and deliver experiences tailored to individual needs.
In the darker version, companies use AI to flood every channel with competing offers, consumers become interchangeable targets, and loyalty erodes beneath a constant stream of promotions.
The consequences reach everyone who buys a product or relies on a company to solve a problem. The difference will be determined by what businesses choose to optimize.
Growth Strategies
If I were evaluating a company today, I would start by examining its reputation across Google, AI-powered search, and customer reviews.
What are people saying? Are the complaints fixable? Does the business model allow the company to deliver what customers expect?
I would then scrutinize the experience after purchase, including onboarding, customer support, communication, and the ease of resolving problems.
Executives should apply the same discipline to their growth strategies. Track customer acquisition costs, but place equal weight on retention, repeat purchases, referral rates, lifetime value, and the proportion of revenue generated without another paid impression.
Set explicit retention targets, assign senior ownership of the post-purchase experience, and require marketing leaders to demonstrate how acquisition spending translates into lasting customer value.
AI will make it easier to sell almost anything. That makes the reason a customer chooses to return one of the most valuable assets a business can own.
Look at your own business and ask yourself one question. If you stopped paying for customers’ attention tomorrow, how many would choose to return?
Your answer may reveal more about the health of your business than your next quarter’s sales figures ever could. A click can be bought. A customer’s trust has to be earned.
Matthew Stern is the Chief Growth Officer at Direct Meds, a digital healthcare platform, and an entrepreneur with nearly two decades of experience in digital marketing, customer acquisition, and business growth. The views expressed are his own.
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