If you want to increase your business revenue and your brand awareness, then you NEED to focus on Customer Acquisition.
Customer Acquisition helps you to onboard new customers or clients to your business.
And it is becoming popular day by day.
So, today in this blog, we will learn about everything related to Customer Acquisition that we need to know like, what, why, how, and almost everything. So, let’s get started:
What Do You Mean by Customer Acquisition?
Customer Acquisition is the process of discovering and targeting potential buyers, nurturing them through the sales funnel, and transforming them into paying customers or clients.
A customer acquisition strategy should ideally be a thorough, continuing undertaking that is regularly tweaked and updated in response to market changes and trends.
The professionals in customer acquisition use some special techniques to get potential customers to take action.
The main aim of this process is to create an organized, long-term strategy for attracting new customers and boosting the company’s revenue.
Well, customer acquisition is the most important factor for all types of businesses whether it is small or big, and new or old. It allows your organization to:
- Make enough money to cover costs, pay employees, reinvest in expansion, and
- Establish traction with third-party stakeholders such as investors, partners, and influencers.
Having the ability to consistently find and convert new customers keeps businesses healthy and flourishing – and investors satisfied.
What is the Customer Acquisition Funnel?
Usually, in the business world, we imagine the whole journey of a customer with a funnel or something similar like that. And, it highlights every single stage of the buying process and the mindset of the prospect.
Customers who travel through the funnel on their way to becoming buyers:
- Improve your brand's recognition.
- Include your product or service in their list of options.
- Make the decision to become one of your company's paying customers.
To be in an easy word, lead generation takes place at the top of the funnel, lead acquisition takes place in the middle, and lead conversion takes place at the bottom.
And, this whole funnel refers to the customer acquisition funnel.
What Are the Stages of Customer Acquisition Funnel?
The client acquisition funnel's peak is fairly large. Consider casting a wide net to capture as much interest and attention as possible. As lower-quality leads fade away and the brand pushes the remaining prospects toward a sale, the funnel narrows.
1. Awareness of the Brand:
For the first time, new prospects and audiences are presented to the brand. By promoting the brand and/or doing independent research.
The brand distinguishes itself or its products by educating people. Also, through appealing to their emotions with a clever or resonant message.
Prospects go to the company's website, download information, and sign up for a free trial. They will get more familiar (and presumably more at ease) with the brand and its services as a result.
Prospects go along the sales funnel, getting closer to making a purchase decision. This is done by watching product demonstrations and placing items in their shopping basket.
The brand engages them even more as a result of their recent involvement. At this point, prospects begin to weigh the costs and benefits of completing the purchase. Choosing a similar brand/product or doing nothing at all are other options.
When a prospect makes a purchase, they are considered a customer. After the sale, companies can look for ways to cross-sell, upsell, and reward customer loyalty.
Also check: How to Offer Cross-Channel Customer Service
What is the Customer Acquisition Strategy?
The customer acquisition strategy is the process where a business takes an approach to reach its new customers or clients and then convince them to buy their products and services.
Before attempting to acquire customers through a succession of coordinated marketing touch-points, a strong customer acquisition strategy leverages data to investigate consumer behavior and uncover marketing opportunities.
Because customers interact with a variety of digital platforms on a regular basis, your customer acquisition strategy will most likely include a mix of marketing channels.
Did You Know? According to the recent report of HubSpot, 55% of customers no longer have the same level of faith in the brands they buy from as they once did. Whereas 65% of customers don’t trust advertising and approx 71% of customers no longer have the faith in sponsored social media postings.
Why Do You Require a Customer Acquisition Strategy?
In order to stay sustainable and competitive, businesses must continually fuel growth in two ways.
- First, they must attract and convert new customers.
- Second, they must also persuade existing customers to raise their expenditure.
A well-thought-out and well-executed customer acquisition strategy can also save you money.
Furthermore, you may maximize your ROI by targeting the right prospects and delivering the right message at the right moment.
What are the Core Elements of a Customer Acquisition Strategy?
Well, there are no particular templates for growing the why, where, and how of a customer acquisition strategy. However, the approach should be customized to the organization and its target audience.
Integrating Business Objectives/Strategies:
It should be decided from the start what success looks like and what metrics will be used to measure it.
Corporate management should look at marketing's historical influence on growth (the percentage of new revenues that can be attributed to marketing efforts) as well as industry benchmarks when defining business and campaign objectives.
Customer churn should also be taken into account. When churn is high and client acquisition initiatives must compensate for losses, it's tough to grow.
On the other side, a client retention strategy can help relieve some of the pressure. Allowing for more equitable and realistic customer acquisition goals.
Choosing the Most Effective Acquisition Channels:
A customer acquisition plan can be implemented in a number of ways. SEO optimization, content marketing, affiliate marketing, digital advertising, and traditional advertising are a few examples.
Testing a variety of channels is the only way to figure out which ones bring the greatest value. Furthermore, to evaluate their respective effectiveness and customer acquisition costs (CAC).
What is the Best Customer Acquisition Strategy?
As we discussed some of the major issues are why customers don’t have to trust the brands. But, it doesn't mean that there is no option to enhance your customer acquisition.
So, what do you think? How will you improve your customer acquisition? Do you have any ideas or plans? Well, I don’t think that you have any ideas or plans. Agree?
Well, consider the following list of some evergreen customer acquisition strategies that you can leverage to ensure that you are always getting new customers.
1. Identify Your Potential Customer:
The first step you need to proceed with is that should identify your potential customers or consumers for your company.
It's likely that your product is the appropriate solution to a problem that a specific group of customers is having. It's simply a matter of identifying who they are and focusing all of your customer acquisition efforts on them.
You are undoubtedly restricting your ability to advertise your business efficiently if you don't have a target customer in mind.
Unless your services are in high demand, you should create a niche market for yourself.
So, how do you go about finding your ideal clients?
You should do complete market research and then try to figure out what are the tactics you should apply to market your products to win over new customers.
2. Should Use Correct Acquisition Channel:
If you are thinking to identify who are your ideal customers, so I need to tell you that it is not enough. Besides, it is equally important to know which acquisition channel should be used.
There are currently a number of frameworks available to help you figure out which channel is best for your customer acquisition efforts.
Finding the right channel, on the other hand, usually needs a lot of trial and error.
To make things easier for yourself, set defined goals for yourself and your campaign. Even broad targets will aid in determining the efficacy of your strategies.
When you have tried a few different channels after that you will be able to compare individual results and find that which one is suitable for you.
If you need help with channel alignment or choosing the right KPIs, reach out to Selling Revolution.
They develop sales techniques that might help you generate more high-quality leads.
3. Leverage Video Content:
In this era, video marketing is booming. These days, approx 81% of businesses are leveraging it which is upped from 63% last year.
Therefore, approx 97% of marketers are found that video content is beneficial for their organization. Because it helps their customers to easy to understand what they are offering to potential customers.
Besides, 76% of marketers have found that video content helps to enhance web traffic and sales as well.
Films are one of the most effective ways to educate prospects about your business and products since people learn visually.
It's important to establish a balance between educational and enjoyable films. Make such movies with the help of influencers, which you can then share on social media and your website.
What's more, you might wonder.
The use of explanatory videos and client testimonials is another great method. They are not only amusing, but they also provide users with the necessary information to make an informed purchasing decision.
4. Do Giveaways:
Generally, customers require more than just words and promises which convince them to buy products and services from your company.
Whereas influencer or word-of-mouth marketing will not sway some of the most adamant clients.
Therefore, you should provide doing giveaways to win these customers or consumers as loyal customers.
You should offer them a free trial of your product. And it will help you to push them extra so that they will seriously consider you as an option.
If you run a giveaway campaign on your company’s social media then it is an easy way to apply customer acquisition strategies.
So, do you know how can you launch giveaways? Let me inform you!
You can use a tool like VYPER. It will help you to create a giveaway on social media. It allows you to create stunning landing pages with drag and drop features in your giveaways.
In that case, you just need to select a template and then customize it as per your requirements. As a result, once traffic will start to come then you will get all the data that were entered in the form. Additionally, it will help you to ramp up your lead generation efforts.
5. Provide High-Quality Content on Daily Basis:
Content marketing is one of the effective and evergreen customer acquisition strategies. How? Let me explain to you.
Content marketing helps you to establish your thoughts on your company or niche. These days, getting the trust of customers or consumers is a half battle. And the content will help you to win that battle.
Consumers are growing more and more educated. You will acquire your prospects' trust and, more than likely, convert them if you enable them to make informed purchasing decisions. Client acquisition will be aided by creating valuable, helpful, insightful, and amusing content.
Creating high-quality content on a regular basis, especially for social media, can be challenging.
6. Focus on SEO:
Just insightful content is not enough. After producing high-quality content, you should work on SEO as well. It will help you to improve the rank of the content in the search engines.
Therefore, your content will be visible and discoverable by your targeted customer or audience.
You have to do a lot with the first stage of the customer acquisition funnel to improve search rankings and brand visibility. Some of the most basic SEO techniques include the use of industry-related keywords, backlinks from authoritative websites, and so on.
Optimizing your website for mobile devices is another wonderful SEO strategy for generating clients. Last year, approx 50% of the traffic is generated by mobile devices.
Providing a fantastic mobile experience to prospects, particularly on social media platforms, can be the deciding factor in converting customers.
7. Referral Programs Should Be Run:
If you are a rising company then the referral program will serve on the basis of several customer acquisitions with the aim of finding new customers.
You can offer leverages to your current customers such as some extra features or discounts to encourage them to refer your products and serc=vice to others.
And it will also help if you offer the same discount to your new customer to leverage your services.
8. Optimized Landing Pages Should Be Created:
Optimization of the landing pages is one of the most effective customer acquisition strategies among others. Landing pages help to direct customers towards your products and services.
An effective landing page does not just provide valuable information but also includes a compelling call-to-action that facilitates conversions.
What's more, you might wonder.
An A/B test will greatly assist you in optimizing and improving your landing pages. It all boils down to knowing what your customers want from you.
You must be able to anticipate their needs and then fulfill them.
9. Enhance Engagement of Website and Email:
While this is an older method than the internet, it is still one of the most effective ways to get customers.
Email and website engagement will help you to always be in front of your targeted customers or audience. Additionally, it helps to promote your content, discounts, and product information.
Therefore, it is the easiest way to connect with and acquire your new customers or consumers.
Sending a customized email to the customer according to the stage of the customer acquisition process where they are, is a great way to improve customer engagement.
As a result, it will help in better customer engagement if someone is at the first two steps.
What about the other?
Those that have you on their consideration list are more likely to respond to product-related emails. As a result, customers will be able to make more informed purchasing decisions.
Similarly, consumers who are nearing the completion of a purchase can be tempted to complete it by receiving a promotional email with a discount.
For example, Amazon is a master in this job. They send personalized emails to their target demographic on a regular basis.
It could be to remind them of items on their wish list or a shopping cart that has been abandoned. If you've recently made a purchase, try something like this.
Customer Acquisition Cost (CAC): What is it?
CAC (customer acquisition cost) is the total cost that is used to acquire a new customer. It is calculated to figure out ROI for all the customer acquisition initiatives.
The customer acquisition initiatives include traditional marketing and advertising to digital marketing campaigns for community events and trade shows.
The minimization of CAC for a customer acquisition channel will maximize its value for the business.
Read More: How to Improve Customer Service Skills
If you want to calculate CAC for a particular period of time then you should divide the total market expenditures by the total number of customers acquired.
CAC = (MC + W + S + OS + OH) / CA
MC = marketing costs
W = wages for marketing/sales personnel
S = marketing/sales software
OS = outsourced services
OH = sales/marketing overhead
CA = total number of customers acquired
Furthermore, if you want to calculate customer acquisition costs for a single initiative or campaign, then the formula would be like,
CAC = MC / AC
If you want to create a customer acquisition budget (an "allowable CAC"), then consider the customer lifetime value (LTV).
A larger CAC can be justified and even required for clients who spend more over time.
An LTV: CAC ratio of 3:1 or less is ideal, but if the ratio is 5:1 or higher, you may be underinvesting in customer acquisition and missing out on growth opportunities.
To put the LTV: CAC ratio into context, you may want to track relevant metrics in addition to it. Client growth, customer turnover, and monthly revenue increase are just a few examples.
Ways to Reduce Your CAC (Customer Acquisition Cost)
If you want to reduce CAC then there is no need for major campaign overhauls.
You just need to consider the following tactics and tricks that will minimize the customer acquisition cost. Have a look at them!
1. Boost the Conversion Path:
Examine the landing pages and call-to-actions on your website. How successful are they at converting customers? Is it possible to update the concepts, layout, and/or copy?
Well, A/B testing data can be used to make strong decisions and fine-tune your online presence.
2. Convert Existing Customers into Brand Advocates:
Loyal customers have the greatest impact on their friend's and family members' brand perceptions and purchasing decisions.
Existing customers that promote the brand on social media should be rewarded.
Request that they share contests, coupons, giveaways, surveys, and other such items on their personal social media accounts.
3. Experiment With New Innovative Ideas:
Cost efficiency can always be improved, if a client acquisition channel is doing well and your CAC is within acceptable levels.
Experiment with different methods and channels, and be ready to modify your spending priorities based on their success.
What Are the Leverages of Customer Acquisition in the Businesses?
In this era, every business has strategies and activities to get more potential customers. Any business that doesn't have sufficient customers then there will not get many profits. So, to acquire more customers they struggle.
Well, there are several reasons why companies advertise and do activities to get new customers. Some of them are listed below. Have a look at them!
1. Help Businesses via Increasing Sales:
Any company's principal purpose in acquiring new consumers is to increase product sales. The need to make money is why there are so many advertising and promotional activities.
Having a business that does not generate revenue is the same as running a non-profit organization, which is not the primary goal of forming a company.
Adding new customers boosts a company's revenue and, as a result, profit margins. When you acquire new consumers, you also acquire their purchasing power.
This indicates that if your profit margins were lower prior to their arrival, they will grow as a result of the new purchase.
2. Enhance Awareness of Your Brand:
One of the most common motives for people to promote is to increase brand recognition. If your brand is only available in one location, then you will go to great lengths to expand it to another.
The time and money spent advertising the product and promoting it to new customers increase brand awareness in a variety of ways, resulting in higher profits.
Expanding into new markets, increasing sales and market share, improving brand perception inside the target market, and collecting audience data are all possible with brand awareness.
You must gain more clients utilizing various advertising strategies to make this brand awareness effort a success.
3. New Customers Play an Important Role in the Growth of Your Business:
New customers play a vital role in the promotion of your company’s brand rather than just profit and sales. A new customer will be a part of your business growth via purchase, feedback, suggestions, and many more.
Without them, your business will face lots of struggles. Customers suggest where is the place of mistakes and also they provide some innovative ideas about how to overcome that issues. It will help your business to run much better.
Most companies launch new products because the clients who use the same product from another company suggest it. But if you will get new customers then it will develop your new products as per new client’s suggestions.
4. New Customers Aid to Expand Your Business:
What happens if you get too many new clients to handle? Do you try to drive them away or do you try to expand your business? Of course, you grow your business. One of the advantages of acquisition is this.
It helps you take your business to another level. For example, if your company was manufacturing 100 units of a certain product per day and had more customers than it could fill, it would search for ways to increase output.
This will include buying new machinery, expanding the facility, and bringing in modern, high-capacity machines, among other things.
As a result, you end up with a much larger company than when you started. The majority of the companies you see began out small. They have, nevertheless, acquired clients as a result of their acquisition.
Well in this era, every organization focuses on the strategies how they can grow their business. Truthfully, there is no perfect way to advertise your business. But yes! Customer acquisition and customer retention are the key elements for almost every business.
Customer acquisition helps to acquire new customers and also helps in the growth of the company's revenue. Therefore, it is essential to create content at each stage of the customer acquisition funnel.
It will help in brand awareness, expand your business and also enhance sales and profits. Investigate the brand thoroughly, learn about the company's dynamics, and figure out what works and what doesn't.