Boost Your Customer Acquisition Process
If you look for some advice concerning customer acquisition, you are almost always told that it is better to retain current customers than it is to acquire new ones. This is for one simple reason — it’s five time cheaper. If you want to grow your business, you need more customers, that’s a sure thing. But building your customers’ loyalty helps both your brand and revenue. Having a strong customer base is the basic foundation of a successful business.
Today, we’ll be talking about…
1. Defining your current and ideal audience — 80/20 rules
2. CPC vs. CPA metrics
3. Social media as an acquistition channel
In the beginning of creating any acquisition plan is an absolute awareness of who is your current and your ideal customer. The difference between them is presented by the 80/20 rule. It is most likely that 80% of your customers make only 20% of the purchases in your online store — they buy just once, with low average order value. They cost you a lot and don’t bring you significant revenue in return — only 20%. The other 20% are your current, desired and loyal customers with 80% of your ROI. They buy frequently in your store, give feedback and recommendations to other prospects. Simply put, they help you tell the world about your great product.
These loyal customers are also the influencers of your prospects.
Define this audience you want to attract and learn every possible detail about it. First of all, make sure you avoid one fatal basic mistake — don’t try to satisfy everyone. If you already have a customer base, check if it fits your expectations of who your customers should be.
Here are some problems that you may encounter if you don’t get your targeting right.
- Low sales — your customers can’t find you because you provide insufficient information on your products or you address the wrong audience.
- Your products are sold well, but they don’t earn profits — go through your costs and check if the effort you put into specific activities pay themselves back, e.g. campaigns.
- You’re well known in your local market, but you want to sell globally. The best thing you can do is to sell through more channels (sell on eBay, Amazon, Pinterest, etc.)
If the reality differs from your plan, try to find out where your desired customers purchase instead of your store. Your competitors may not necessarily be the biggest players, but those who are able to attract and keep the same target group as you’d like to. Compare your product’s quality, services, shipping and payment methods. Discover the gaps that you have and try to cover them.
Easier said than done, right? What you need to be on track with successful acquisition is to take a look at your data. It tells you everything.
Start with the analysis of your current audience. You already have two basic resources full of information — Google Analytics and your social media analytics (or both in one, when you use MonkeyData).
You can get a clear picture of the gender, age and geographic location of your audience, the page they currently visit, devices they use, sources that bring traffic to your website and a lot of other helpful information. These allow you to create an authentic message delivered through sources that work. Putting all these pieces together takes a significant amount of time, so why not take a shortcut by using an app instead of doing it all by yourself.
Important metrics to track — CPC vs. CPA
Analyzing your current customers’ situation also includes calculating the cost per acquisition. This metric tells you how many dollars do you have to spend to get one paying customer. Don’t confuse it with the cost per conversion which reflects your cost per each action that your customers complete successfully. Conversions are important but do not necessarily bring you money. Conversions can be things other than purchases. They can be things like subscriptions to your newsletter or downloads of your ebook. The conversion should lead to a purchase eventually, but the way there may be a bit longer (and cost you more money).
CPA = Cost per Acquisition
It is your total acquisition expenses divided by your total new customers.
CPC = Cost per Conversion (in terms of PPC campaigns it’s Cost per Click)
It is the total cost of generating traffic divided by the total number of conversions (or clicks).
To make your acquisition strategy more precise, track CPA in each channel. Check which channels generate the most traffic and conversions and run your campaigns there.
CPA per channel = It is the marketing cost for each channel divided by the number of customers acquired through that channel.
How to make social media an acquisition channel?
A significant portion of your customers likely comes from social media. Much has been discussed about “How to do business on social media” and learning about how it is still worth your time. For the next few years ahead it’s true that being successful equals being social. The list of social media platforms is endless and trying to be active on all of them is futile. It also takes too much effort (80% of your time) with a few rewards (20% of purchases). Keep in mind that different social media platforms serve for different purposes.
Assuming you have your own online store, there are specific social media concepts that can help you in these areas:
1. Increasing your product sales
Facebook drives 85% of all orders coming from social media. It is today considered as another marketplace and as an important marketing channel. No wonder that 8 million local business pages have been created during the period of 2012–2013 alone.
In terms of the highest average order value for purchases on social networks, the first is Polyvore with 66,75$, second is Instagram 65$ and Pinterest is third with 58,95$. This is evidence of the fact that good picutures sell. Check Pinterest and Instagram merchants similar to you and learn how to built a bigger fanbase and buzz around your brand. Of course, more followers won’t necessarily bring you revenue right away, but they become more likely to purchase in the future.
2. Customers’ conversion rate
The highest conversion rate from all social media sites is Facebook at 1,85%, followed by Vimeo and YouTube. A good acquisition strategy is to start shooting promotional product videos. The big advantage of video ad is the ability to capture the almost real feel of products and the emotions they raises. Thanks to the visual beauty it’s easier to share and remember. This is how you can improve the relationships with your visitors and turn your customres into fans.
3. Build the relationship with your customers
Customers who are already engaged with the brand also expect having customer support and forums directly on Facebook. Check these trends and if it’s something your customers’ need, provide them. The content you share doesn’t need to be only commercial. If you know your audience is in the 20–30 year age range, and are males from US, they probably love series like Rick and Morty, South Park etc. Create some funny or inspirational content associated with their personal interests which is also linked to your brand.
Word to take:
The acquistition process can be shortly described by following these general tips:
- Define your target audience and market to them accordingly
- Provide up-to-date information about your products
- Entertain with funny or inspirational content
- Let them talk about your products — create forums, or find the ones your customers have created. Join the conversation, help them solve their problems and find inspiration for content development.
- Maintain the relationship with your customers — engage on social media, keep in touch and deliver them great content to make them long-term fans of your brand
- Make them want to buy — with enticing product photos, descriptions and videos which help to showcase the benefits of your products
- Implement great customer service — with chat windows in social media, a phone number available to call. Be there for your customers in case they have any questions or problems regarding your products.
To succeed in acquiring new customers and retaining your current ones requires customization for your specific target audience. All the specifications which are clearly visible at first sight are available in your data analytics.
