It depends on the margin. Excluding other concerns, if you're about to lose 10 customers (1+recommendations) and your margin is 5%, then it's better to keep the replacement; if your margin is 20% then it's better to keep the customers.
For many companies, the rate of defects and replacements determines the difference between profit and bankruptcy.
This calculation does not take into account the lifetime value of a customer. And his reviews. My grandfather told stories about a Ford lemon he got in '68 and how rotten the experience was until he died in his late 70's.
For many companies, the rate of defects and replacements determines the difference between profit and bankruptcy.