Customer Acquisition for Start-Ups

Customer Acquisition for Startups

How do you plan to acquire customers? It may sound like a simple question, but your answer could make or break your business. Developing a well thought-out and detailed customer acquisition plan is one of the key fundamental components of a successful start-up.

Don’t fall into the trap of thinking “if you build it they will come”. While it’s true that providing a great product that meets a demand gives you a massive advantage, there’s much more to building an audience then simply opening your doors and waiting for the money to pour in. That’s where customer acquisition comes in.

Inbound vs. Outbound Marketing

Customer acquisition is all about two similar but distinct things: bringing people to your product and bringing your product to the people. This is the fundamental difference between inbound and outbound marketing.

Outbound marketing primarily involves what we think of as more “traditional” forms of marketing, including paid advertisements, cold calling and direct mail. Essentially, any time you directly engage consumers regarding your products, you’re performing outbound marketing.

Inbound marketing, on the other hand, refers to activities that bring customers to you. This includes such activities as content marketing, building a subscription-based e-newsletter and social media marketing. These activities encourage consumers to expose themselves to your brand and products willingly, whether or not they intend to make a purchase. You’re still engaging consumers, but you’re not forcing yourself on them.

There is certainly a role for outbound marketing in the modern marketplace – especially when marketing to baby boomers, one of the most valuable demographics – but the industry is turning heavily toward inbound marketing for one simple reason: that’s what most consumers are responding to.

With outbound marketing, customers stop coming when you stop paying into it, but with inbound marketing you can build a loyal and committed community around your businesses. When developing a customer acquisition strategy for your start-up, inbound marketing should be at the heart of it.

3 Steps to Creating Your Customer Acquisition Plan

1. Identify your goals

Everything starts with identifying your goals. Whether they are monetary, traffic or conversion based, the goals you initially set define what qualifies as “success” for your business.

Begin by deciding which kind of customers you want to attract. Millennials or baby boomers? High or low income? Single or family-oriented? Once you’ve identified your ideal customer profile, everything else becomes so much easier, from finalising the tone of your content and branding to having the confidence to know that when a customer comes to you, they’ve come to the right place.

Then you need to identify how valuable each customer is to you and how that’s going to affect your acquisition strategy. For example, if you’re dealing in high-cost luxury items, you can probably afford to spend a lot of time, money and marketing efforts to converting a single customer. If your business sells a low-cost, high-volume product, then you’ll need to cast a wider net.

In this way, your goals are going to shape your marketing, because whether your goal is to attract more visitors, convert more visitors into leads, or convert more leads into paying customers, the value of each of these customers is going to affect which types of acquisition strategies you should invest in.

2. Define your growth strategy

Now is the time to reverse engineer your customer acquisition plan. Look at your goals and ask yourself how you are going to get from point A (now) to point B (achieving the goal), then develop campaigns, tactics and strategies that align with those goals.

Use your customer profile. Will they respond well to email blasts and paid advertisements, or do they prefer to learn which businesses to trust through word-of-mouth and high quality content? The hard sell has gone out of style, so the growth strategies you develop will need to be built on inbound marketing tactics and reveal a deep understanding of your product, industry, and most of all, your target customers.

It’s important to constantly analyse your current strategy and test new campaign to identify just which tactics your target audience responds well to and which ones are having a negative effect on your growth. Use these tests to optimise your customer acquisition plan.

growth processImage source: http://ryangum.com/customer-acquisition-plan/

 3. Control your customer acquisition rate

As important as it is, customer acquisition is just one component of a successful start-up and should work in tandem with the other pillar of small business: product development. If you’re not careful, you could spend too much time working on one and not the other, and if your customer base growth is too quick (or not quick enough) for your product development, it could throw your entire business off-balance.

By developing more leads than your product can keep up with, you’ll risk developing a high churn rate and a negative reputation for providing sub-par or insufficient products. Conversely, by investing too much in product development, you’ll risk losing the revenue stream needed to pay for the development and waste precious resources working on products that suffer flaws due to insufficient consumer feedback.

Ultimately, advertising isn’t the be-all and end-all it once was. Large, wealthy companies used to be able to provide a poor-quality product and make it successful by pouring huge amounts of marketing money into it. Today, because people rely heavily on word-of-mouth and because news can spread faster than ever via social media, product and marketing are two sides of the same coin. A successful start-up can’t have one without the other.

A solid customer acquisition plan needs to respond to this reality. You need to be aware that consumers aren’t listening to you, they’re listening to what other people are saying about you. You need to be prepared to shape that conversation by providing good content, good product and good service. Customer acquisition isn’t about finding your customers, it’s about making sure your customers find you.

To learn more about how to locate and market to the right audience for you, subscribe to the DalPay Blog. For news and updates from around the industry, follow us on Facebook and Twitter.

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Appealing to Baby Boomers

baby boomers

We recently published an article highlighting the increasing importance of millennials to the economy as their buying power grows and how to market to them effectively. But we’re not suggesting that you should abandon older generations – particular not baby boomers, who continue to outspend all younger generations combined online.

“Baby boomers” refers to anyone born between 1946 and 1964, which makes up almost half of the total population, yet accounts for over two-thirds of the wealth. While millennials dominate the headlines when it comes to online marketing, baby boomers tend to be highly tech-savvy and active in social networks and e-commerce, contrary to popular belief. Just like millennials, they can be just as hard to win over, so learning how to market effectively to this generation is vital.

Many Segments

When speaking about an entire generation, we need to be wary of making too many generalisations, and that’s doubly true when it comes to baby boomers. With nearly 20 years separating the oldest and youngest members, it’s best to think of this generation as comprised of many segments with only a few defining characteristics that truly apply to the entire group.

The first thing you need to do before trying to appeal to baby boomers is to recognise the diversity of this market. One of the key factors is that many boomers are in a period of transition, whether it’s going from a full house to an empty nest, entering retirement, or experiencing health changes. Some are still raising children, some are caring for their parents, and some have become grandparents.

While all of these lifestyle changes manifest in different ways, they can all be used to understand the consumer habits of this generation. Marketers should profile their customer base to identify which market segments within this group are part of their audience. By isolating relevant behaviour and lifestyle characteristics, businesses can tailor their marketing and product selection according to specific data variables such as disposable income, education level, household composition, and known leisure activities.

In addition, at a time when marketers are rushing to jump on the mobile bandwagon, it’s worth noting that, despite being increasingly tech-savvy, boomers in general have not embraced mobile commerce, preferring to access the internet via computers, especially when it comes to making a purchase.

Tips for Appealing to Baby Boomers

Don’t call them old

Make no mistake, just because boomers are getting older doesn’t mean they’re becoming their parents – they’re just becoming older baby boomers. This is a group that grew up in the age of consumerism and helped define branding and marketing as we know it. And they don’t see themselves as old – many consumers in their 50s are involved in activities typically marketed to much younger age groups, such as sport and fitness.

Baby boomers have been called the “me” generation, and that’s certainly not going to change now that they have both the money and the leisure time to freely pursue their interests and hobbies. They know they are likely to live longer than their parents and expect to live the good life. Now in their 50s, 60s and 70s, boomers are committed to rebelling against ageism stereotypes. 60 is the new 40, and that’s how you should market it.

Give them a variety of choices

Unlike their parents, who were thrifty and practical, boomers grew up in the age of individualism, when the concept of “the customer is always right” ruled the day. Boomers are accustomed to having all the power when shopping and will not make purchase decisions lightly. They research thoroughly before choosing what to buy (and who to buy it from) and want to feel like they made the choice on their own.

If you want to appeal to boomers, provide them with a variety of choices in every area, from the products you offer to the payment methods you accept. Skip the hard sell – boomers don’t want to feel like they’re being “sold to”. Make sure to provide as much information as possible about the product and its benefits, then allow your customer to make the sale without any pressure.

Build trust and loyalty every step of the way

Trust and loyalty are important no matter who your target audience is, but even more so to boomers, who are accustomed to face-to-face commerce and who expect the same from online businesses.

Building trust requires action at every step of the customer’s experience. Firstly, be open, honest and relevant in all of your marketing materials and your product descriptions. Then make sure if they communicate with you easily if they have any questions or concerns via social media, email and phone – an option that’s especially popular among this group.

Once they’ve decided to make the purchase, be sensitive about collecting data from them. Boomers are more concerned with their online privacy than younger generations, so don’t ask for more information than you need and be honest about how you will be using that information.

And finally, you’ll never build trust and loyalty if you don’t keep your promises. Because this generation tends to expect more from merchants (both online and offline), they can be very unforgiving if you make a single misstep, whether it’s poor customer service, late delivery or inaccurate product descriptions.

Embrace “old” marketing tactics

Though they are tech-savvy and regularly go online to research products before making a purchase, for most boomers direct mail is still a common first step on their path to purchase. Print brochures and mailed flyers are still an effective marketing strategy for this generation, and can be a good way to expose your brand to a new older audience not as prone to browsing online for new brands.

Don’t believe the stereotypes. Boomers are going to continue to become more tech-savvy and more of them will embrace e-commerce. With this generation controlling 70% of all disposable income and approaching (or having already reached) retirement, they stand as the single most valuable generation to marketers. By appealing to baby boomers, you’ll be tapping into the greatest reserve of wealth around.

To learn more about how to locate and market to the right audience for you, subscribe to the DalPay Blog. For news and updates from around the industry, follow us on Facebook and Twitter.

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