In the past few years, the cost of acquiring new customers has increased by more than 50%. With marketing getting costlier, customers are becoming less trustworthy of brands…What should you do in this scenario? The answer is customer acquisition! In this blog, we will take you through customer acquisition and ways to improve customer acquisition.
We’ll elaborate on how and why a solid customer acquisition strategy is imperative for any business.
Then we’ll dig deeper into who’s a customer and who’s a consumer — yes, they are not the same!
We will also give you insights on:
- Which client would you advise to advertise on the google search network?
- HNI clients
- How to improve the ad position of your client And more…
- So let’s get started!
Table of Contents
What is customer acquisition?
Customer Acquisition implies getting new customers. The term is used when one tries to convert their existing prospects to become new customers. In most scenarios, the targeted customers are unaware of products/services. Or they may have used similar services from competitors.
Customer acquisition is a systematic process that requires preparing a strategy to retain and increase your customer base. Interestingly, customer acquisition also measures how much value the customer will bring to your business. A series of systems and methodologies come into play here which help manage customer inquiries. We’ll discuss them as we go further.
When a business attracts customers systematically, it can attract & convert new customers. Doing so keeps a company/business growing — and ensures great revenues. You might be thinking that isn’t that lead generation and customer acquisition.
The above funnel is an example of how the customer journey happens through the different buying processes. It also explores the mindset of the customer.
The meaning of acquisition is an asset or object bought or obtained. Leads are the qualified prospects who can become customers and ambassadors of your brand if you play your cards right.
Sure, a firm may have several important goals, but a large percentage of organizational goals focus on lead generation. Moving through the funnel, customers are able to:
- Become more aware of your brand
- Consider your product or service
- Decide to become a paying customer
Basically, the top of the funnel takes care of lead generation while the acquisition happens in the middle — finally leading to conversion. Customer acquisition embraces the funnel as a whole.
Customer acquisition vs. customer retention
Retention takes place once customer acquisition is over. Retention includes strategies in the business to convince the customer to continue with your services.
Once you have the customer, you want to keep them!
The acquisition process involves marketing to potential customers and educating them about the products or services the company is offering. On the other hand, retention includes customer satisfaction, quality of service, and loyalty programs.
What should you consider prior to customer acquisition?
Is your business ready for Customer Acquisition? Before exploring or investing in strategies, you need to get your basics right. There’s a lot to consider beforehand.
Nurturing and developing your business or service takes a lot of time and effort. Prior to executing the acquisition process, ask yourself:
- Whether your product ready for some or all customers?
- Will customers get a good experience, or still a few bugs are uncovered?
- Is your store server ready to take on high traffic?
- Is your product reliable for targeted customers?
- Is your support team ready to respond to a customer inquiry?
It’s better to delay the acquisition process rather than let a little hitch hamper your business identity. Try to invest a little extra time and effort into scaling your business.
What is the customer acquisition strategy?
The customer acquisition strategy is a process to drive and scale your business.
Justin Mares mentions in his book (co-authored with Gabriel Weinberg), Traction, that, “Phase 1 [of gaining Traction] is very product-focused and involves pursuing initial Traction while also building your initial product. This often means getting Traction in ways that don’t scale.”
20 ways to improve customer acquisition
Let’s unveil 20 strategies for customer acquisition.
1) Find the right Acquisition Channel
A customer acquisition channel is a place to “meet” potential customers. It could be a trade show, on social media, or via organic search. The source through which you acquire customers is defined as the customer acquisition channel!
Keep in mind that while ways to improve customer acquisition may work on a particular channel, they may be terrible on another. The best growth channels for you would depend on the:
- Industry
- Product
- Audience preferences
Some of the options are:
- Cold calls or emails – Make sure you reach out to the right people. Warm your leads up by connecting via social engagements in advance of your message.
- Viral referral loops – Strategies include word-of-mouth referrals, structured referral schemes, and viral loops.
- Paid advertising – Think Facebook ads. But do remember that if you are not tracking ROI, you can blow your budget.
- Content marketing – They work well, but it takes a couple of months to show results. However, they are long-term strategies that yield better results.
- SEO – It’s similar to content marketing and will take time, but it works.
- Influencer marketing – Connect with a few big names related to your industry that might influence customers to convert.
2) Bring back older content to life
Often, we come across blogs that gave older information. For example, a 2105 statistic will show a lower set of social media users than a 2020 one. You should update older blogs, especially when you are still optimizing them. One should continuously revise, update, and clean up old content to keep it relevant.
It will help you increase organic traffic & generate leads faster than writing a new blog post. Not updating them means you are slashing your ROI dramatically.
You can update them by:
- Identifying top posts
- Update/add relevant matter
- Use the same post, and keep URL the same
- Retain keywords, even if you change the title
- Optimize meta description
- Republish it
Do track the before and after the performance to view the difference in lead generation. Now let’s learn another ways to improve customer acquisition.
3) Allow guest bloggers
Why should I encourage guest blogging on my website? Well, for starters, guest bloggers are not intruders! Guest blogging is a great way to build brand awareness. Hearing it from credible and third-party sources works well for getting new customers.
You get content – may be free, or you reimburse your bloggers. As a result, you will:
- Grow your personal brand
- Grow an audience with a stream of social followers, subscribers, etc.
- Boost SEO performance
- Build authoritative backlinks
- Build relationships and drive new partnerships
- Drive referral traffic
When guests re-post on their blog, this drives traffic and generates new leads for you too.
4) Create a compelling sign-up form
You must benchmark your current state of lead generation before tracking your success. Doing so will help you map the areas for improvement. Some website pages may be awesome lead generators — you just don’t know it yet!
5) Conduct an audit
Conduct an audit of where you get the most traffic. Is it:
- Social media
- Blog posts
- Live chats
- Email marketing
The form can solicit the contact information of prospective leads through various sources. For instance, if you are in construction or real estate, your social media pages could be generating more leads for you.
A pop-up form that piques user interest will lead to more people filling it up. The form should offer some value to the user — a dow-loadable ebook or a free add-on.
6) CTA strategy and organization
CTA is also one of the best ways to improve customer acquisition. A CTA or call to action will captivate your target audience. It will also educate them and increase your conversions. As per Small Biz Trends, 70% of small business B2B sites lack a call-to-action.
Your CTA should compel your visitors to take the right action isn’t an easy task. It should invoke a sense of urgency — get it now before it’s gone — something on these lines.
This can be done through:
- Piquing curiosity
- Using powerful language
- Instant gratification
And finally, a CTA may benefit them in some way. For example, a coach or trainer could give a free webinar. An e-commerce company could offer discounts. Your website navigation should be uncluttered. It should also give a clear breakdown of why your consumers desire your service or product. It should apply both down the homepage and throughout the menu. A website that is easy to maneuver and gives crisp information is always a winner.
For example, I visit an online grocery website. I want to see offers, but I don’t want so much clutter that I get confused. So striking a balance here is important!
7) Blog and offer epic content
Quality content gives fiber to your website. The homepage or main page, in particular, is your business value proposition. Here you should focus on one primary keyword or long-tailed keyword. This should include words/phrases your audience is searching for.
It will help them find your product or service.
Your lead will come to your website through that particular keyword. For example, if you are a digital branding company, your keywords could be digital branding, a digital branding consultancy, etc.
Along with value-added content, make sure to use:
• Bullets and headlines
• Use small paragraphs
• Give white space
8) Building engagement
Now, a first-time visitor is really not likely to stumble on your website and buy stuff, right? Any prospective customer should be completely engaged with your brand prior to making purchases.
For attracting them, building quality relationships is critical. Research from McKinsey shows that “70% of buying experiences are based on how the customer feels they are being treated.”
How can you build this engagement?
- Know your ideal customers’ pain points.
- Conduct in-depth meetings, especially for sales teams.
- Try & have informal conversations with existing customers.
- Work with the marketing team to develop accurate buyer personas.
- Find ways to connect the company’s values with consumers.
Take the example of the sports brand Nike. They use their mission of fitness, sports, and motivation to engage with the audience. For them, everyone is an athlete!
Social media for building engagement
Social media is an effective customer acquisition tool. Through channels like Facebook, Twitter, etc. you can build engagement. The online community is one of the core influencers you can ask for.
9) Educate your prospective customers
Conventional sales models are a faux passé — they are outdated, overrated, and don’t work! Thanks to technology, everything is accessible with the click of a button. So, if you are selling your prospective customer is likely to Google it!
Instead of persuading prospects, it is recommended that you try to become their trusted partner.
Educate the customer!
Keep in mind that without sales, there is no business.
However, if you adopt a method of educating the customer – which leads to selling, it works better! Sharing valuable information makes you an industry expert. The customer will trust your opinion and not worry about being misled.
10) Turn your blog posts into in-depth guides
Your blog should be packed with information and quality content. Before writing the blog, think about what different or more are you offering a prospective lead?
It is not that your blog should belong – it should offer precise and crisp information that your end-user is looking for. Let’s take the example of a simple food blog. A user searched for spaghetti in the tomato sauce recipe. What would he expect?
A good recipe, of course. But hello, you also give ten different ways to spice up or dial down that recipe — awesome. And then you throw in a free pasta video — how cool’s that!
What have you here is an in-depth session on using tomatoes and pasta. And this user will subscribe because of the value-added info.
But if you talk about Italy and take the visitor to the history of pasta, you’ll have the user yawning.
And you lost a lead!
11) Build partnerships
Considering the global economy, thriving in isolation is not possible. You should consider building partnerships. This will help create a sustainable business model.
One can gain exposure to new audiences by tying up with other brands. Strategic alliances make it possible to get more business.
It helps one:
Increase market share Gain additional financial and human resources to meet client demands.
Take the example of Spotify and Uber.
The duo teamed up so customers can listen to their favorite playlist while riding in a hired car. It added exclusive value to Uber riders. And in return, Spotify received a unique selling point for its members to upgrade their services.
12) Use visuals
Add more visuals to connect with users. They say a picture paints a thousand words. Studies show that 69% of marketers now view visuals as absolutely necessary. 80% of people are likely to read colorful, engaging content.
However, keep in mind the visuals should spark curiosity and increase the desire to read your content.
13) …And infographics
Are you aware that images are processed 60,000 times faster than words?
Publishing infographics that are linked to your landing page has also shown to increase traffic by 12%.
So don’t downplay the role of infographics in lead generation. It is a major driver of engagement and traffic.
They can multiply social media engagement. Relevant infographics will lead to higher conversion rates. For example, if you are in healthcare, an infographic highlighting your patient engagement and consumer-friendly offerings would catch the eye.
For real estate or the hospitality industry, it could be promoting luxury!
14) Add video whenever possible
Another suggestion is to add videos whenever possible. Did you know that 80% of businesses use video marketing to:
Attract
Inform
Entertain customers and prospects
Videos tell brand stories and educate at the same time. They show products in action and demonstrate their use. Videos are also great tools for building emotional responses. Plus they quickly go viral.
Try and make these videos the central feature of your social advertising campaigns.
15) Create optimized ads
When it comes to advertisement, social media is the way to go. It’s effective & budget-friendly. Across the years, successful social advertisers have altered their ad creative through the use of quantitative creative testing.
Systematic evaluation and changes were made to ad copies, call-to-actions, and video lengths to create winning concepts. As per studies based on the $1 billion ads on Facebook, Instagram, and Google, it can be said that 80% of the time, it is possible and cost-effective to create new variations of winning or previously successful ads. The remaining 20 can be devoted to developing more unique concepts.
16) Leverage paid ads
As per recent research, the paid online advertising business had a turnover of about $111 billion in 2018. In 2019, it overtook traditional media ad spending.
The study further indicated that search and social media ads were the two most powerful traffic drivers for customer acquisition.
They were also low-cost! Advertisers had the option to:
- Pay per impression (CPM)
- Pay per click (PPC)
…depending on their campaign budgets and priorities.
17) Think of a referral program
It is highly recommended to ask customers and friends to refer your business or service. In return, you can give them incentives, perks, etc. Even then, this customer acquisition strategy is a relatively inexpensive tactic.
And it is also one of the most highly effective ones. One of the best examples here would be young startups like Dropbox and Airbnb.
They both used referral programs to fuel multi-billion-dollar growth. The Airbnb Referral Program allows members to earn promotional coupon credits — which basically travel credits.
It can be used toward future homes/experience bookings. All one has to do is refer a friend to become a new user on Airbnb.
18) Industry, Feature & Location Pages
One can increase organic search traffic with high commercial in-tent and customer acquisition. For doing the same, you need to rank relevant keywords in reference to specific industries and locations you want to target.
It should also target the individual features of your product.
Any organic traffic coming to your website is high commercial intent. It means the visitor is on the lookout to purchase or buy! However, this still is less than the numbers you can get from more informational queries like “how to do…”
Sometimes, queries work better when it comes to targeting without being too competitive in the search engines.
Some of these examples are:
- Industry-specific queries. For example, “real estate CRM”.
- Feature-specific queries. For example, “cash payment for hospital software”.
- Location-specific queries. For example, “used cars, Chicago”.
Not all may be something that you relate to — but you get the idea!
19) Be transparent
Another customer acquisition strategy is transparency in your business. It is important you keep the product message simple and straightforward. Too much frill around it will confuse the customer.
As a result, they will lose interest. In this reference, let’s clear the difference between your consumer and customer.
Often, marketing and advertising lingo are complicated. In simple terms, a consumer is someone who consumes or uses the goods. The customer is someone who can buy the commodity and makes the payment for the same.
When you keep the brand message clear — the customer takes action. They will convert to consumers.
With a clear path, your brand will benefit. Also, if possible, add social proof wherever possible. These can include:
- Media mentions
- Product ratings
- Testimonial
There may be something negative here; nevertheless, it is the positive ones that the customer would see.
20) Reassess &reconsider your offerings
Now that you have a comprehensive customer profile sorted, it’s time to turn over a new leaf. Reassess your products or services in a fresh light. Here’s what you should ask yourself:
- What features or advantages of your business/service are most likely to attract customers?
- What is of less interest or could actively discourage new customers?
- What should be at the forefront of marketing and paid advertising?
- What kind of images and copywriting should you go for?
This will add more value to your offering and help generate new leads.
How To Measure Customer Acquisition?
So, you know the importance of bringing new customers… However, it’s critical to understand the actual cost of acquiring a customer! In this reference, there are three primary calculations one must take into consideration to determine the customer acquisition cost or CAC.
a) The Actual CAC
Putting it simply, the CAC is basically your total sales and marketing costs divided by the number of customers you’ve acquired during that period.
So it’s
Sales costs + Marketing costs / Number of new customers
Let’s take an example.
Suppose you spent around Rs. 10 lacs on sales and another 5 lacs on marketing. Doing so helped you get about 50 clients. So your CAC would be Rs. 30,000.
However, it is critical that you also get an accurate picture of the impact of acquiring new customers may have on your business. Compare this number to the value or the revenues which your company will get.
b. Customer Lifetime Value (CLTV)
CLTV is as pivotal as CAC. It gives an estimate of the recurring revenue you can expect from new customers — since they’ve been associated with you.
Your CLTV should ideally outweigh your CAC (usually, 3:1.)
If that’s not happening, something is wrong with either your:
- Sales model
- Customer retention
- Marketing efforts
How is this number worked out?
Average sale x Number of repeat sales x Average lifespan of a client
Let’s consider an example.
A B2B company sells IT services. The value of the average signed contract is Rs. 10 lacs per month.
They retain clients for an average of five years.
So here’s the calculation:
10,00,000 x 12 Months x 5 Years = 600,000,00
In this reference, you need to address another important customer acquisition question:
How your CLTV connects to your CAC?
Determine the lifetime value your customer brings to your business. Then weigh that value against the cost of acquiring them.
Your customer’s potential CLTV should justify his/her acquisition cost. If that is not happening, it is best to reconsider the:
- Pricing model
- Retention strategy
- Is the customer a good fit
C. Churn Rate
The churn rate is the third calculation, which gauges the impact of your CAC. Now when doing business, you lose some, you gain some…
But it’s crucial to retain as many customers as you can.
Two churn metrics that one can follow are:
- Customer churn rate — which shows how well — or poorly — you are doing at retention.
- Calculating customer churn rate for a fixed period — it can be a month or longer.
Getting to the Magic Number
The Customer Acquisition Cost is the magic number you should be thinking of. The three metrics mentioned here:
- CAC
- CLTV
- Churn rate
Combined, they reflect vital aspects that are instrumental for the success of a business. This includes:
- The success of your sales team
- Pricing model
- A deeper understanding of your finances
- Helps with sales forecast
- Budget for future spending
But what is the magic number for CAC? Actually, the answer oscillates between Yes and No.
For example, startups must spend money to make money. Initially, this means higher CAC. Investments include sales team and marketing efforts.
Investments include sales team and marketing efforts.
But you can get the “magic number” for your company. Here’s how:
A higher CLTV and a lower CAC
Some find the 3:1 ratio for your CLTV to your CAC ideal.
One can decrease the CAC and increase profits by:
- Shortening your sales cycle
- Increasing lead generation
- Changing your payment periods
5 innovative ways of Customer Acquisition for your Real Estate Company?
Real estate is all about selling dreams — it’s about sentiments and emotions. However, customer acquisition is not easy in this sector. The competition is tough. The economic slowdown and the pandemic have added to the woes.
In real estate, while the quality of lead generation was top-notch, it might not always translate into closures. Yet there are ways to pave the way to attaining success consistently:
a. Identify your niche market
This applies more to real estate than any other sector. You cannot sell swanky, luxury homes to a middle-class family or a low-budget home to an HNI or high net worth individuals.
b. Create a website & start using social media
Despite the current market scenario, your website adds credibility to your business.
In real estate, your website navigation should be uncluttered. It should also give a clear breakdown of:
- New/upcoming projects
- Older successful projects
- Testimonials/certifications/awards
- About us
- Why you’re the go-to experts
Social media is a tool that will increase customer acquisition for real estate companies by simply educating your visitors.
Take a cue from Ira Realty — an upcoming real estate company. The CMD preferred sharing educative messages rather than selling.
C. Think of referrals
When it comes to real estate, customer referrals can make a world of difference. For example, if your sibling or family member is referring to a real estate company— aren’t you more likely to believe them?
Real estate companies can have referral programs. Something as simple as giving house-warming presents or gifts helps get more referrals — leading to customer acquisition. These are not very costly and have the potential for huge outreach.
D. Have a real estate newsletter
A newsletter is a constant way to engage with your audience. When you have a newsletter — you provide customers with periodic updates, news, promotions, and events communicated in print or electronic form.
For a real estate company, the newsletter success can be measured through-
- How many people open your emails
- How many people click on links within your emails
- How many people unsubscribe from your list
Publishing a weekly or monthly newsletter with updates on current topics, homeownership benefits, etc. attracts a new audience.
Again, you are educating them, and it accentuates your knowledge and commitment to the business.
E. Build brand awareness
Similar to any big brand, your real estate business should have its own brand-building strategy.
For this, you should:
- Size-Up The Competition
- Define Your Brand
- Deliver Value
- Refine & Reassess It From Time To Time
- Be unique
6 easy ways of Customer Acquisition for Your Professional Service Firm
Professional service firms provide knowledge-based services to clients. They exist in multiple industries and include lawyers, advertising professionals, architects, accountants, financial advisers, engineers, and consultants, among others.
Customer acquisition for them includes 6 critical aspects.
These are:
a. Generating more referrals
As a professional service firm, you are more likely to get new business as referrals. This form of customer acquisition comes from existing clients. This means you have to spend very little on outbound prospecting, marketing, and sales.
Referral marketing is based on harnessing and nurturing client relationships so that they refer to you. It can simply be called word-of-mouth!
In simple terms, they are introducing your services to their personal and professional network. One must prioritize the needs of current customers over future customers.
If you plan to introduce a new program, you must provide features that keep your customers engaged. If not, they won’t be referring to your brand repeatedly.
For a smart customer acquisition strategy, you should try and obtain detailed insight to optimize the program.
b. Regularly updating/upgrading their website
If you don’t already, do invest in a good website. It is not costly — and literally takes a few minutes. Make sure you take time out to update it at least once a week. Share patient reviews, updates, blogs, etc.
Just having a website enhances credibility and reliance on your professional service firm. 80% of consumers decide if they will opt for your service or not by simply seeing your website!
c. Increasing and enhancing the visibility of their firm
To increase and enhance the visibility of your firm, you should offer value-added services.
A basic summary of these includes:
Online Search and Search Engine Optimization (SEO): Optimise your website pages, blog posts, and other content landing pages. Don’t stuff keywords.
Social Media: This is perhaps the best tool to drive engagement. Ideally, you should use the 80/20 rule and share 80% of other firms’ content and 20% of your own.
Webinars and Educational Events: These two tools will help give you the benefit of interaction with your audience.
Other options include:
- Email marketing
- Cold calling
- Print advertising
- Blogs
d. Increase the visibility of expertise
Your expertise is your unique selling point as a professional service firm. For example, if you are an architect — then what kind of designs do you specialize in?
Cite examples of your expertise while educating your audience through the above mediums.
e. Offer more value to clients
Why should a client come to you? Customer acquisition for professional service firms requires incentives and added value.
For example, if you are a coach or a counselor you can have a complimentary session. Give a free short-term program.
Added value always attracts new clients!
f. Have a compelling message for potential clients
A compelling message can turn around your customer acquisition strategy. There are various ways of doing this. One is social proofing. Reviews from existing clients always help. For instance, if you are a doctor, reviews are a testimony of your trusted services.
7 B2B Client Acquisition Strategies
Thinking of a B2B customer acquisition strategy? One should take a closer look at the new, connected customers they hope to acquire. As per recent research, B2B marketers, the top customer acquisition techniques are:
- Brand awareness
- Lead generation
- Lead nurturing
Let’s take a look at the top techniques and some more:
a. Brand awareness
Brand awareness is defined as the level of consumer consciousness of a company. The same is used for measuring the potential customer’s ability to recognize a brand image. It also associates with your company’s product or service and can be done through both inbound and outbound marketing efforts.
b. Build partnerships
Thriving in isolation is not possible for any B2B company. You need to build strategic partnerships to create a sustainable business model. New audiences gain exposure through this. Strategic alliances make it possible to get more business.
It helps one:
- Increase market share
- Gain additional financial and human resources to meet client demands
c. Build engagement
Customers don’t just stumble on your website and buy. You have to make an emotional connection with them.
You need to provide them with a high-quality customer experience:
- Know your ideal customers’ pain points.
- Conduct in-depth meetings, especially for sales teams.
- Try & have informal conversations with existing customers.
- Work with the marketing team to develop accurate buyer personas.
- Find ways to connect the company’s values with consumers.
d. Lead generation
According to 85% of expert marketers lead generation is the most crucial element of the marketing arsenal!
Only 42% of business owners have a proper plan for lead generation. Leads are qualified prospects who are your customers and eventually become your brand ambassadors. The higher your conversion rate, the more your business will gain profits in the process.
e. Nurturing leads
Lead nurturing is focused on purposefully engaging the target audience by offering relevant information.
How you nurture a lead directly impacts a customer’s decision about converting into paying customers. Ways of doing the same include:
1. Targeted content: It uses methods like tailoring intriguing, entertaining, and delightful content to entice the visitors.
2. Multi-channel lead nurturing: Trying to lure prospective customers on multiple channels instead of just emails. Think of social media, blogs, offers, etc.
3. Multiple Touches: It focuses on increasing your interactions and engagement among target audience members.
4. Timely Follow-Ups: You should follow up with prospective leads to keep them engaged and interested. Remember, timing is critical here.
5. Personalized Emails: An all-time popular customer acquisition tactic for lead nurturing is personalized emails.
6. Lead Scoring: Think of a lead scoring strategy to focus on targeted or niche leads.
7. Sales and Marketing Alignment: Improve your lead nurturing tactics through sales and marketing
f. SWOT Analysis
It’s best to play to your advantage when it comes to customer acquisition. A SWOT analysis brings into focus your:
- Strengths
- Weaknesses
- Opportunities
- Threats
Being aware of your critical low points or faults as a business is key for wooing prospects in the B2B industries. SWOT analysis will help you differentiate from competitors and get an added advantage.
g. Customer reviews
Plenty of customer review options exist. However, they should be personalized and inclusive of all types of site visitors.
For example, a software B2B company uses its tool for running customer satisfaction questionnaires. It helps them qualify leads and funnel the customer acquisition process in a natural, discreet manner.
Any positive review adds value to your business. Yes, a little negative comment will make you more real.
Conclusion:
This blog is packed with tips and suggestions to maximize your customer acquisition potential. There is no one-size-fits-all — what works for a healthcare company could not work for a professional service firm.
