Acquiring customers has never been easy and modern businesses face more competition than ever to find, attract, and convert consumers.
Both B2C and B2B companies are affected by rising acquisition costs and ProfitWell even put out a study stating that the cost of customer acquisition has grown by over 50% over the past 5 years.
The reasons behind this increase are varied but a big issue is customer sentiment and trust – there is so much noise out there that you really have to stand out to get traction.
While it’s easy to sit back and assume that a high cost to acquire a customer is just the cost of doing business, companies that have taken the time to develop a detailed customer acquisition strategy have seen their costs decrease while their sales grow.
In this post, we’ll examine what a solid customer acquisition strategy looks like.
What’s customer acquisition?
Customer acquisition is all about the process of creating a consistent flow of new customers to your business.
While this process almost always has costs associated with it, some methods are much more expensive than others.
A customer acquisition strategy is the act of managing the costs associated with gaining customers while identifying ways to optimise the process. When done correctly this strategy will become an essential part of your retail business plan.
Why Customer Acquisition strategy Is Vital To A Successful Business
- Generates brand awareness
When done correctly, brand awareness can start to carry more and more of the customer acquisition burden. The best part is that it’s free so it can really drive down your cost to acquire and even become a primary marketing channel that drives sales for next to nothing.
However, if you neglect to tie your brand’s story into your marketing efforts, you run the risk of letting your finances do all the heavy lifting as you leave a major sales lever un-pulled.
- Measuring success and scaling
Once you find a strategy that allows you to land new customers consistently, you can then test and scale your success across other channels.
In addition, a well-implemented strategy allows you to quickly measure and find out what you’re doing right (or wrong), and optimize your methods accordingly.
- Keeps your acquisition costs down
Managing the cost of each new acquisition is just as important as finding ways to get new customers.
Having a strategy that not only allows you to test but also tracks the costs associated with each experiment is critical when it comes to managing a marketing budget. In the end, if you don’t know your cost per acquisition, you’re not going to be able to determine what’s working and what’s not.
Factors to consider when planning your Customer Acquisition Strategy
Every good customer acquisition strategy should focus on four key components: sustainability, flexibility, target audience, and diversity.
Customer acquisition strategies should strive to perform well over long periods of time and it’s important that you have the resources and skills to support them.
For example, if you’re about to pour a ton of money into Facebook ads but your social media manager is about to go on maternity leave, it’s probably worth waiting until you have the best chance for success.
Similarly, if you are convinced that a blog-driven inbound strategy is the right way to go but don’t have any way to convert the incoming traffic, it’s worth pressing pause on your publishing to put that piece in place.
You should also allow room for flexibility in your acquisition strategy as there is going to be a lot of testing and optimising required to find something that works.
Using the Facebook ads example above, if you find a specific type of messaging or content works well with your audience then being able to allocate more resources will help immensely.
On the other hand, if your copywriter is tied up with another project and you can’t produce the content you need, it’s going to take a lot longer to gain traction.
- Targeted Audience
Customer acquisition can lead to a massive drain on your resources if you’re not focusing on the right crowd.
Before making any decision on your acquisition campaigns, you need to make sure your targeted audience is clearly defined. By spending more effort in understanding the persona of your buyer, you can be much more laser focused on your acquisition efforts and weed out any unnecessary costs.
Don’t hesitate to spend money to test and understand this – it’s OK to allocate a small PPC budget to test audiences on Facebook or copy on Google. Simply track everything in your strategy plan and trust that what you spend now will decrease costs later on.
While diversifying should not be the goal of a new customer acquisition strategy, it can be beneficial when you have some data and a bit of success.
Diversifying used to be a pretty expensive endeavor for businesses, but thanks to the digital nature of advertising you can now follow a potential customer as they view your ad on Facebook, check out your newest release on your site, and eventually pop into their email inbox to remind them that you’re still there.
By diversifying your acquisition strategy across various blogs, social media platforms, You Tube channels, or even podcasts, you increase your chances of reaching new audiences and starting the coveted brand-awareness flywheel.