Jory MacKay on March 26, 2024 How to do customer acquisition the right way in 2024
You can build the best product in the world, but without a solid customer acquisition strategy (and the right team to pull it off), no one will ever use it.
But customer acquisition isn’t just about getting users for your product — it can be life or death for your company as a whole.
In the last five years, the average cost of acquiring a new customer has increased by a staggering 60%.
Whether you’re a product manager, team leader, or marketer, you should be aware of how customer acquisition happens, what channels your company uses, and how to measure the success of their projects.
Jump to a section:
In this guide, we’ll explain how to understand your customer’s journey to finding and using your product, the channels available, and how to create a winning customer acquisition strategy for your company.
What is customer acquisition? Why is it so hard to get right?
Customer acquisition is the strategy companies use to gain new customers, including how they attract new leads, nurture them, and eventually convert them into paying customers.
Ultimately, the objective of a customer acquisition strategy is to gain more customers while also setting the foundation for long-term retention. Your acquisition strategy could use tactics ranging from email marketing and social media to outbound sales or events.
Customer acquisition influences everything from how you prioritize features to your go-to-market strategy.
But while customer acquisition has traditionally been the focus of sales and marketing teams, the best strategy can’t make up for a subpar product.
Most customer acquisition strategies use free trials, system demos, or explainer videos to entice a lead to become a customer, so the product needs to be slick and easy to use to ensure it makes a great first impression.
But, knowing about customer acquisition is only half the battle. To guarantee success, you first need to get inside your customers’ heads and understand where they are in the buying journey — and how you can meet them there.
Top of the funnel: Creating awareness for new leads
The start of the journey is all about getting your brand in front of potential customers and piquing their interest. At this stage, most companies use broad tactics to drive exposure to large volumes of people in a cost-effective way.
This could include content marketing, search engine optimization (SEO), or traditional advertising. For example, an accounting product may look to boost its product’s exposure by investing in its SEO rankings for the search term “Best accounting software in the US.”.
Middle of the funnel: Showcasing value and building intent
Once a potential customer (also known as a prospect) knows who you are, your goal changes to increasing their interest and moving them towards a purchase.
This is the hardest part of the funnel to navigate, as prospects are often evaluating multiple options at once — so there’s a chance you may miss out.
To improve the odds in their favor, companies use techniques such as email marketing, retargeting via social media, and invitations to events (e.g., webinars) to improve customer consideration and demonstrate their product’s value further.
For example, having executed their SEO strategy, the accounting product’s marketing team may encourage prospects to sign up for an email marketing list so that they can send personalized email campaigns and invite them to online promotional events.
Bottom of the funnel: Converting prospects to customers
Once a prospect decides that your product is right for them, you need to convert them into a customer. While most of the work is done by this stage, you must ensure you don’t fall at the final hurdle by making the buying process as simple as possible.
Depending on your product and sales cycle, you may reach out directly to qualified prospects, leverage business partnerships, and offer discounts or free trials. This is where product teams heavily contribute to the customer acquisition journey by making product onboarding, navigation, and setup intuitive and easy to complete.
For example, the accounting product may offer a free 7-day trial to convert prospects into customers. During this trial, they’ll assign a customer success manager to help with onboarding and answer any initial questions.
How do you acquire users? 12 customer acquisition channels
While we’ve touched on a few in the previous section, the key to executing a killer customer acquisition strategy is to use the right mix of tactics and tools at the right time.
Let’s look at 12 of the most common ways businesses reach potential new users as part of their customer acquisition strategy:
- Your product. In the world of software, your product is, in itself, a customer acquisition channel. Many organizations adopt a product-led growth strategy, using the expansion and cross-functionality of a product to acquire and expand their customer base. For example, an instant messaging app may offer free services and then cross-promote additional paid features that drive extra value.
- Content marketing. Content marketing is a fundamental lead-enticing strategy for many businesses. Whether it’s articles on insightful topics or thought leadership opinion pieces, content is a great way to offer value to customers while subtly promoting your products and services.
- Organic search (SEO). Many future customers begin their journey on search engines, so getting your website to rank highly can put you at the front of the queue. SEO is a long-term strategy but one that pays dividends when executed well.
- Paid search (PPC). If you’re looking to jump the SEO queue, paid search gets you straight to the top of the page in the sponsored section of relevant search terms. While it’s a great way to get in front of new prospects, it comes at a cost if the rest of your strategy doesn’t deliver.
- Organic and paid social media. When many people spend hours a week on social media, it’s the perfect place to start your customer acquisition journey. Much like organic and paid search, companies use a mix of long-term engagement plans and short-term advertising to show off their products and services via social media.
- Influencer marketing. Linked to both social media and content marketing, leveraging trusted influencers with an engaged audience is a great way to get your brand noticed. This is especially true if you’re targeting younger demographics who trust personalities they follow on social media.
- A website. Those who are best at customer acquisition tune their websites for speed, efficiency, and value. A great website can make or break a future sale, so take the time to optimize it for value and ease of use.
- Email marketing. Email continues to be a great way to keep prospective customers interested in your products and services. Whether it’s a newsletter, a free resource, or an invite to an upcoming event, email marketing is a great way to provide regular drops of value to a future customer.
- Events. Whether it’s running your own or attending a third-party session (e.g., an industry conference), events are a great way to meet and engage with new leads. They allow you to showcase your expertise and knowledge while connecting you with your target audience with a pre-qualified need or interest. Events may be in person but also virtual, such as webinars.
- Affiliates and partnerships. Customer acquisition doesn’t need to be driven 100% by you. Affiliates sell your product on your behalf (for a commission or per-sign-up fee), while partnerships with complementary organizations are also a great way to cross-promote products and services based on a level of trust.
- Traditional advertising. While the digital world is ever-expanding, traditional marketing still presents a big opportunity. You can choose to promote your product via radio, print, or TV — all channels with high coverage.
- Customer reviews & testimonials. When prospective customers are evaluating options, they’ll rely on the feedback and opinions of others. Reviews and testimonials, whether on your website or social media channels, are a great way to build trust and move a customer closer to a buying position.
How to create a winning customer acquisition strategy in 2024
For product companies, those who survive and grow are those with the best customer acquisition strategies. Now that you know what customer acquisition is, it’s time to put it into practice and create your own customer-winning strategy:
1. Identify your ideal customer
Before you head off trying to acquire new customers, you need to pause and determine who your ideal customers are.
Many businesses make the mistake of going after anyone who is willing to pay them money. Instead, you need to identify and target your product’s ideal customers as they’re the people who’ll gain the most value and stay loyal into the future.
How to do this:
- Start by analyzing your product offering to clearly understand the value you deliver.
- Next, conduct market research to identify who requires the product you’re offering.
- Then, formalize the process by creating a customer persona/profile that can be shared across your organization.
Real-life example:
Roberta is a Marketing Manager for TimeHack-R, a mobile application that helps people plan their time.
Roberta and the team are preparing to launch the app and want to set their customer acquisition strategy. They know their app will help those who are tech-savvy and need to optimize their time to hit tight deadlines. They conduct research and establish students aged 16-25 are their ideal customers, so they create a customer persona to work from.
While customer acquisition has traditionally been the focus of sales and marketing teams, the best strategy can’t make up for a subpar product.
2. Understand the customer journey
Once you know who your ideal customers are, you need to understand how they act, think, and make buying decisions. This is crucial to determine the customer acquisition tactics you’ll employ and begin calculating your customer acquisition costs.
How to do this:
- This starts with more research into your ideal customers. Specifically, you want to try to understand how they:
- Spend their time
- Engage with different channels
- Respond to different types of marketing messages
- Get to a buying-ready position.
- Remember, no two customer journeys are the same. Depending on your ideal customers, you may identify a 6-month journey with 10+ touch points or a snap purchase after just two or three engagements.
Real-life example:
Roberta and the team focus on their ideal customer to establish the best customer journey. They find that students aged 16-25 spend a lot of time online, especially on social media, where they follow influencers they like and trust.
Given the low cost of the app, the buying decision for TimeHack-R would be fast so long as the app was easy to purchase, download, and use immediately.
3. Set your high-level goals, targets, and parameters
A great customer acquisition strategy has to be right for the customers, but it also has to be right for your business.
Before you begin with the creative elements of customer acquisition, take time to set goals and define your parameters. This will help you build a project plan in the coming steps.
How to do this:
- Start by fully understanding your product strategy, including the 3, 6, and 9-month roadmap ahead of you.
- Next, consider the objectives you want your customer acquisition strategy to deliver, be that number of inquiries, product sign-ups, or profit.
- Lastly, ask yourself these questions to determine your parameters:
- What budget do you have available?
- How quickly does a customer acquisition strategy need to be in place?
- Do you have the resources allocated to support you?
Pro tip: Using tools such as Planio are great for helping you store, track, and communicate project plans and objectives. Whether through task management, document storage, or in-built chat, Planio’s perfect for getting everyone on the same page and help you move forward as a team.
Real-life example:
Roberta sits down with the Chief Product Officer to understand TimeHack-R’s growth strategy. To support the ongoing strategy, she needs to launch her customer acquisition campaign in the next six weeks, aiming to achieve 50 sign-ups per month.
She has a $6,000 per month budget, which she will manage solely as the company’s only marketing resource.
4. Choose the right customer acquisition channels & set KPIs
With all of the foundation work in place, it’s time to select the customer acquisition channels that align with your ideal customers and business goals.
You’ll want to choose a mix of tactics across the customer journey’s awareness, consideration, and purchase stages to ensure consistent support. Then, you’ll set KPIs to help you track whether each channel effectively engages prospective customers.
How to do this:
- Review our list of common tactics above to identify the ones best suited to your ideal customer.
- Once you’ve selected your channels, decide on a KPIs for each one. You may already use consistent North Star metrics across your organization, but if not, here are some common KPIs to consider:
- Number of leads generated
- Number of sales generated
- Cost per acquisition
- Conversion rate.
Real-life example:
Having reviewed the customer persona, Roberta chooses social media advertising, influencer marketing, and the website as her key customer acquisition tactics.
She allocates $4,000 per month to social media and $2,000 to influencer marketing, with a goal for each one to generate 100 leads per month.
5. Plan and execute your strategy
You’ve done all of the thinking and strategizing, and now it’s time to put your plan into action. This is where customer acquisition and marketing project management collide as you execute the individual tasks and actions to get your product in front of customers.
How to do this:
- Start by reading the Planio Guide to Marketing Project Management for detailed advice on planning, executing, and monitoring project tasks.
- If you’re working in a startup business, align your initial marketing effort with your go-to-market strategy to ensure you hit all the right notes.
- Planio is the perfect tool to help turn your strategy into reality, with modules to support task planning, risk logging, communication, cost control, and time tracking. It helps keep the entire team aligned in one place, with extra features to collaborate with team members and customers alike.
Real-life example:
Roberta pulls together a marketing project plan to launch her customer acquisition strategy. She chooses a marketing project management software to clearly lay out the tasks to complete, storing design ideas for social media posts in the document repository. She uses communication features to engage and stay up to date with influencers and track the time they spend working for TimeHack-R.
6. Get customer feedback, adapt, and improve
You’re unlikely to get your customer acquisition strategy right the first time, so once you’ve launched, look for ways to gain feedback and improve for the future.
As your product develops, your target audience will change with new customer acquisition strategies available to maximize your growth.
In the last five years, the average cost of acquiring a new customer has increased by a staggering 60%
How to do this:
- Like many things in product management, tracking user feedback is essential. Start by reading the Planio Guide to User Research to get tips, tricks, and a free research template to help.
- As you develop your customer acquisition strategy, don’t be afraid to try new things and work in an Agile way to drive continuous improvement. No one gets it right the first time, so take forward any lessons learned to improve for the next month.
Real-life example:
After the first three months, Roberta notices the number of leads generated from the strategy is lower than the 100 she targeted.
She gains feedback from failed prospects, noting that the influencers and social media posts were too vague in their messaging. Roberta decides to use new influencers for the next three months and provides them with clear messaging guidance.
How to calculate customer acquisition costs (CAC)
Like everything in business, customer acquisition doesn’t come for free. While posting on social media or attending a local networking event may be free, higher exposure tactics such as organic search and PPC advertising come at a cost.
This is even more important when you consider the lifetime value (LTV) of each customer. To make a profit, you must ensure your customer acquisition costs don’t outweigh the amount of money a customer pays.
Let’s use an example to help you calculate your customer acquisition costs (CAC).
Imagine you spend $2,000 per month on social media advertising that generates ten new customers. This would mean your customer acquisition cost was:
But, as we mentioned above, this strategy only works if it’s profitable. So, you have to overlay your lifetime value and profit margin. Let’s say an average customer spends $500 with a 50% profit margin. This would mean your profit was:
Knowing these numbers will help you decide which customer acquisition strategy is best for you and your business, and how many customers you’ll need to land to hit your financial goals!
How to find the right customer acquisition strategy for your product
With the costs of customer acquisition increasing year-on-year, it’s essential to define a strategy that’s both cost-effective and appealing to new customers.
It’s all about trial and error, working out the right blend of customer acquisition tools and tactics that work for your product. To succeed, you need to remain agile, set clear and measurable KPIs, and not be afraid to pivot if something’s not working.
If you’re still undecided on your customer acquisition tactics, here’s some pointers depending on your current market position:
- Startups: Try organic social and content marketing strategies to set your message apart while keeping an eye on costs. Reward early adopters and work with up-and-coming influencers who align to your values.
- Venture-backed companies: If you’re scaling up, it’s all about maximizing growth while staying lean. A mix of organic SEO, affiliates, and social media advertising are safe bets, helping to land short-term wins while setting a long-term foundation.
- Digital products (SaaS): Digital products lend themselves to digital marketing, but it’s a sea of competition. Lean into partnerships, referral schemes, and online events to showcase your authority and build trust within your industry.
If you’re completely new, remember that the best customer acquisition strategies start with thorough research to understand the customer and the market before diving into execution.
No matter where you are, tools like Planio are essential to keep you and your teams organized, aligned, and pulling towards the same customer acquisition goals!
Try Planio with your team, free for 30 days (no credit card required!)
