Customer acquisition is the process of acquiring new customers. It’s how businesses create qualified leads for their product or service and nurture them over time. Without this, every business would stall.
A qualified lead is a potential client with a demonstrated interest in an organization’s product or service. For example, if a car dealership knows someone is already interested in buying a car, that person is much more likely to make a purchase than someone who’s not on the market for a new vehicle. Reaching out to that person would then be the priority as efforts are more likely to convert. This kind of information allows businesses to focus their sales and marketing efforts on people who are already warm to them, leading to more successful customer acquisition.
Let’s look more closely at the meaning of customer acquisition.
What Is Customer Acquisition?
As we’ve already stated, customer acquisition is getting people to buy whatever an organization has to sell. This is, of course, much easier said than done.
Customer acquisition begins even before a business introduces its product or service to the marketplace. Activities such as internet marketing, advertising, public relations campaigns and networking events can start before a product launches and continue thereafter.
An effective customer acquisition strategy will help a business reach its target audience and increase the likelihood of making a sale. For instance, if an organization is introducing a new brand of cheese, they may offer free samples at the point of purchase such as a gourmet supermarket. Shoppers who enjoy the product might pick up a pack on which there’s a special offer. If they like this too, they’re likely to become repeat buyers.
This process differs widely depending on what’s being sold. Some businesses might opt for a digital marketing strategy only, while others might invest in multi-channel celebrity-filled television ads. In any case, not all strategies and leads are equal. Some have a higher chance of leading to a sale. The success of any business depends on a steady stream of new customers and repeat custom from old ones. Thus, it’s important to take steps needed to make sure the customer acquisition process is as effective as possible.
How To Convert Leads To Customers
Some of the major stages to follow for customer acquisition success include:
A Considered Strategy
The first thing to get in place is a comprehensive customer acquisition strategy that deals with the overall goals and objectives of a business. Market analysis, product development, marketing, delivery and service are all a part of this because without an offering that effectively solves a genuine need in the target audience, no business can get far. A good product is the foundation for gaining clientele.
A Detailed Plan
The next piece is a step-by-step plan that outlines the tactics to be followed. All businesses should have a customer acquisition plan, even if they’re starting out small. Without one, it’s likely that marketing will be haphazard and ineffective.
This plan might involve a sales funnel, which is an illustration of the steps a business takes to gain customers and eventually turn them into paying clients. It shows how leads will become qualified leads, which will then mature into sales.
A Specific Process
The customer acquisition process takes this plan further by putting the tools and systems in place for its implementation. It’s important for marketers to take a systematic approach, which means working to a budget, as outlined in the strategy and plan.
Customer acquisition costs are an important consideration. These are the expenses incurred in the process of lead generation. In one of our examples of customer acquisition above, the cheese brand would’ve to include the cost of hiring a salesperson to show the product on the shop floor, the cost of the samples themselves and fees or commission to the supermarket. It might also include advertising, product research, testimonials, campaigns and other forms of marketing.
A Long-term View
Gaining a new customer from scratch is usually much harder than selling an old customer a new product. That’s where sustained marketing efforts come into play in unlocking the value and meaning of customer acquisition for the long term. Businesses reach out to past customers through means such as newsletters. They may offer them special deals from time to time, converting cold leads to warm ones.
Answering ‘what is customer acquisition?’ is fundamental to every business. Spending time on devising a strategy, plan and tactics right at the outset will go a long way.
Some More Examples of Customer Acquisition
Customer acquisition is the heart of every marketing and sales activity in every organization. Let’s look at a few more examples of how customer acquisition works:
It can bring in new customers by advertising its products or services to people browsing the Internet
Large organizations can run a pan-media advertising campaign
Social media accounts on sites like Facebook or Twitter help establish a presence and brand identity and build relationships
They may offer customers incentives for referring to new ones, such as discounts or gift cards
Online forms can collect data from prospective clients who fill out their contact information and preferences
Customers may be offered freebies and discounts to subscribe to a brand newsletter that keeps people in the sales funnel for future products
The ideas for customer acquisition are many, but not all are appropriate for every business. Every organization needs to decide what’s right for their product, clientele and budget.
Putting The Plan In Place
The big question is, how do organizations do this? There are many moving pieces to gaining customers. There are supposedly no-fail solutions that might be touted by experts too. How to decide what is the right approach? Here’s a quick checklist of factors to consider when developing a customer acquisition strategy:
The kind of customers to be acquired and what they want from the product or service
What information will be included in your marketing communications that’ll persuade prospects to seek what you’re offering?
How much money, time and other resources can be committed toward customer acquisition?
The best way to reach your target customers and get them engaged with your product or service
How will the product or service be made available for customers to buy? Will it fulfill orders through an online store, for instance?
A way for the company to keep track of how these efforts are working and what changes need to be made in the future
Businesses should consider these factors in a customer acquisition plan that focuses on reaching the right clients and increasing profitability.
Communication And Customer Acquisition
The role of communication in customer acquisition can’t be overstated. Communication may take place in person, online or over the telephone. Any marketing tool used to gain new customers may be considered a form of customer acquisition. For example, direct mail is an effective way to reach potential customers. When dealing with certain kinds of communication, such as social media messaging and websites, the information goes out to millions of people, some of whom may be familiar with your brand while others aren’t. Other channels, such as brand pages on Facebook, allow the owners to communicate with existing customers regularly. This is a critical part of customer retention. Clear, concise and on-brand messaging must be maintained at all times.
Since the success of a customer acquisition strategy depends heavily on effective lead management, the skills of the employees interfacing with clients are also important. A good marketing strategy may not be enough if the expertise to communicate it’s missing.
With Harappa’s Compelling Communication Program, organizations can make sure that every interaction with a client—potential or existing—is an effective one. It starts with building employees’ confidence in their ability to speak, write and listen empathetically. It helps them work out any issues regarding body language and delivery, which is so critical for in-person and even online communication. It provides the know-how to seal the deal through storytelling skills and the ability to make compelling arguments that synthesize the client’s needs with the organization’s offering. Help your employees exceed expectations today!
Explore Harappa Diaries to learn more about topics such as What Is Customer Service, Customer Relationship Management, Customer-Centric Approach and Performance Improvement Plan that will help organizations tap into employee potential.
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