Sales are what keep businesses up and running. But without customers, a company’s sales rates would plummet, taking the business down along with it.
Despite its importance, many companies still lack sound customer acquisition strategies. Often, businesses stick with customer acquisition strategies that worked for them in the past.
However, failing to update these strategies and keep up with the latest trends will render these obsolete. That’s why it’s critical for businesses to remain up-to-date with the latest innovations in customer acquisition.
Read on below to learn what you should do to improve customer acquisition and the factors that affect this process.
What is customer acquisition?
Customer acquisition is a business’s process of attracting new customers. It refers to when a salesperson guides potential customers throughout the entire customer journey instead of just leading them to the sales funnel. In this sense, customer acquisition is different from lead generation.
The customer acquisition process is critical to the success of any firm. It ensures a consistent flow of new business and drives a company’s continued growth. An effective customer acquisition strategy also conveys to investors that a company is consistently gaining traction.
A strong customer acquisition strategy must be able to do three things. It must be able to:
- Attract new leads
- Nurture these leads
- Convert them into customers
The costs these steps incur are collectively known as the customer acquisition cost (CAC).
Customer acquisition vs. Marketing
Like lead generation, marketing is another broad term that can be confused with customer acquisition. However, there is a distinction that sets the two apart.
Marketing, broadly speaking, aims to improve a business’s brand awareness and level of visibility. It’s meant to increase traffic and attract more people to look at their products or services.
On the other hand, customer acquisition happens when a business’s marketing strategy does work. It refers to a business’s efforts to drive potential customers to action (i.e., persuade them to purchase a product).
For example, running advertisements on social media is part of marketing, while customer acquisition will be the calls to action that businesses employ.
Best practices to improve customer acquisition
Improving your business’s customer acquisition strategy is a never-ending process. As mentioned earlier, you must keep yourself informed of the latest fads and trends to stay ahead of the competition.
Below are some actionable tips you can follow to improve customer acquisition:
Invest in organic search
Organic search pertains to the search engine results page (SERP) of mainstream search engines, such as Google and Bing. Investing in organic search refers to the efforts you put in to rank higher in these SERPs and gain more visibility.
To effectively use SERPs to improve customer acquisition, you need to invest in search engine optimization (SEO). Optimizing your content for search engines complements your marketing efforts to be easily visible to your target audience.
Plenty of SEO tools are available in the market, many of which have freemium pricing models.
Highly targeted advertising
Recalibrating your targeted marketing efforts can be an effective way to improve customer acquisition. Recalibration, in this context, means re-defining your target audience down to the most minor details.
For instance, you may choose to segment your target demographic depending on:
- Where they live
- How old they are
- What they do for a living
- Their pain points
- Their interests
Advertisements rarely appeal across multiple demographics. Running narrowly-targeted marketing campaigns can be more cost-effective than the spray-and-pray approach of broader ones.
Focus on benefits rather than features
While your product or service’s features are undoubtedly an important selling point, focusing more on its benefits is a better way to improve customer acquisition.
Emphasizing your product or service’s benefits will help customers know why they should choose you over similar competitors.
However, it doesn’t mean you shouldn’t list your features. The ideal compromise is to list your product or service’s features and then show how these features will benefit your customers.
Offer deals and discounts
There’s a reason customers always flock to Black Friday sales: reduced prices for a brief time window. People love getting discounts – they feel they’re part of something exclusive and limited.
And it isn’t just some business mambo-jumbo, you can utilize its concept to improve customer acquisition. A study by the Claremont Graduate University showed that customers who receive discount coupons experienced increased levels of oxytocin, also known as the happy hormone.
Another psychological factor that discounts play on is a customer’s “anticipatory regret.” Discounts convey to customers a sense of urgency that the promo will not last long and help push them toward the purchase threshold.
Factors affecting efforts to improve customer acquisition
There are many factors that can either bolster or hinder your efforts to improve customer acquisition.
Below are some of these factors:
- Acquisition channel. Different channels appeal to different sets of customer demographics. For instance, you may have better chances of converting younger customers on social media than through email marketing.
- Market. This factor represents your target customer base – that is, the people who’ll benefit from your product or service. Without an existing target market, you’ll have no customer to acquire in the first place.
- Your brand’s values. For socially conscious customers, a good product with great benefits will be trumped by its closest competitors if those competitors are shown to be more socially responsible.
