Creating a customer acquisition strategy and focusing on the right customer acquisition channel for conversions is a highly personal process and something each brand must figure out for itself. While this is true, there are some core elements you should keep in mind.
Integrating Your Business Goals and Strategy
You need to figure out what success looks like for you. Success for your business includes defining your target audience. You also need to determine the metrics you will use to measure success. Establishing this from the start is a must and will help you with your goal to acquire customers.
When creating a campaign or business goal, you need to consider your marketing efforts’ historical impact on business growth and look at basic industry benchmarks.
Considering customer churn is also necessary. When churn is high with new or existing customers, your customer acquisition campaign needs to make up for the losses you occur effectively. The new customers acquired should make up for what you lose. If this doesn’t happen, achieving growth is virtually impossible. Having an effective lead generation and customer retention strategy in place will help to eliminate some of the pressure of this. It also helps you create more attainable and reasonable goals related to being able to acquire customers.
Determine the Best Acquisition Channels for Your Business
You can deploy customer acquisition strategies on several fronts. Some include traditional advertising, SEO optimization, digital advertising, affiliate marketing, conversational advertising, and content marketing.
The only way to figure out what channels provide you with value and the newest customers is by testing several of them. You must also measure things like customer acquisition cost (CAC), relative performance, and other vital factors.
Understanding Customer Acquisition Costs
CAC (customer acquisition cost) is determined by taking the amount you spend to acquire a new customer or user and dividing it by the total number of clients you earned.
One example will be if you invest $1,000 in social media marketing. If it resulted in 100 conversions, the customer acquisition cost for this was $10 per conversion.
No set customer acquisition cost is perfect across every industry. While this is true, a good baseline is determined by figuring the customer acquisition cost and comparing it to the customer’s LTV (customer lifetime value).
According to experts, the best CAC to LTV ratio is 1:3. The ratio means that if the customer lifetime value is $30, a reasonable customer acquisition cost is $10. Also, the lower the customer acquisition cost is, the higher your profit margins.
Now that you have a foundation in place to generate new customers, it’s time to learn about the parts of the customer acquisition technique and how to create evergreen customer acquisition strategies. These tools will help you to continue generating interest from new customers.