Buyer Acquisition: If the Math Doesn't Work, Your Advertising Doesn't Work

Whether or not you’re a brand new entrepreneur making an attempt to win over your first ten prospects or a seasoned veteran buying your 10,000th, buyer acquisition by no means stops being related.

However for a lot of enterprise homeowners, gross sales could be unpredictable and gaining new prospects can really feel like a sport of probability. 

If you wish to develop your online business persistently and profitably, it is advisable to consider buyer acquisition not as an consequence however as a course of—one which considers how one can systematically purchase new prospects, the price to get them by way of your door, and the way a lot cash every one will spend with your online business.

Desk of contents

  1. What’s buyer acquisition?
  2. Calculating buyer acquisition price (CAC)
  3. Paid promoting
  4. Influencer sponsorships
  5. E mail advertising
  6. Referral packages
  7. Conventional promoting
  8. SEO
  9. Create a web based viewers
  10. Conclusion

What’s buyer acquisition?

What’s buyer acquisition?

Buyer acquisition is the method of discovering and persuading potential prospects to purchase from your online business in a method that’s each measurable and repeatable—not random.

Buyer acquisition occurs in phases, which are sometimes visualized as a buyer acquisition funnel:

The client acquisition funnel visualizes the journey a possible buyer takes. 

Entrepreneurs and entrepreneurs usually focus on the funnel in three predominant phases:

  • Prime of the funnel (consciousness). At this stage, your purpose is to generate consciousness and leads amongst your target market. Usually, you’ll concentrate on a big, broad viewers that could be all in favour of your organization’s model or merchandise however with out a particular intent to purchase. A child model could use the hashtag #nurserydesign on Instagram to show its posts and merchandise to these seeking to embellish their nursery. 
  • Center of the funnel (consideration). Potential prospects that transfer from the highest of the funnel to the center have often taken an motion that exhibits they’re contemplating a purchase order, reminiscent of signing up for an e mail checklist or following your model on social media. It’s now as much as you to persuade them to develop into prospects. 
  • Backside of the funnel (buy). That is the ultimate stage a prospect goes by way of earlier than they convert right into a buyer. Normally, they’ve taken some motion that signifies a powerful intent to purchase, whether or not it’s including a product to their cart or signing up for a free trial. Companies will usually ship incentives, like a reduction code, at this stage so as to convert prospects who’re shut to creating the choice to purchase.

There are various alternative ways a enterprise can go about discovering and changing these new prospects, particularly on-line. With digital advertising, it has develop into simpler to trace precisely how your online business acquires new prospects, uncover and take a look at new advertising techniques, and scale those who work.

How do you calculate buyer acquisition price (CAC)? 

Nearly each new buyer comes with a value that may be calculated based mostly on the advertising effort put forth to amass them.

With the intention to know whether or not your buyer acquisition efforts are working, you will want to grasp calculate your buyer acquisition price (CAC).

Your buyer acquisition price is the price of advertising divided by the variety of new prospects acquired.

For instance, say your Instagram web page brings in 50 prospects a month and also you spend $500 creating content material. Your buyer acquisition price can be $10:

Advertising Spend ($500) / New Clients ($50) = CAC ($10 per buyer)

The rationale companies calculate their buyer acquisition price is to grasp if their advertising strategy is worthwhile. Utilizing the above instance, if every buyer is spending $50 on common on their first buy from your online business and your gross margin on every order is 50%, your revenue can be $15 on every order.

Common Order Worth ($50) x Gross Margin (50%) – Buyer Acquisition Value ($10) = Revenue ($15)

For manufacturers with a better buyer lifetime worth, it might even make enterprise sense for his or her buyer acquisition price to not be worthwhile on the primary buy. In case your buyer knowledge tells you that the purchasers you purchase will probably proceed shopping for out of your model after their preliminary buy, you could possibly afford to spend extra to amass every new buyer.

By utilizing Google Analytics, Shopify Reviews, and different monitoring/reporting instruments, it’s attainable to know your buyer acquisition price for every advertising initiative. Experimenting with totally different buyer acquisition methods, and attributing the outcomes, is the important thing to unlocking new methods to develop your online business.

Let’s discover a few of the buyer acquisition methods you need to use to develop your online business and prioritize them. 

7 buyer acquisition methods (and use them) 

One of the vital frequent methods to amass new prospects is thru internet marketing. The rationale many ecommerce manufacturers flip to Fb, Google, and different platforms to run adverts is that they supply intensive measurement instruments that assist you to optimize your adverts and get probably the most out of your price range.

In the case of internet marketing, Fb Advertisements and Google Advertisements are among the many largest suppliers for paid visitors. However virtually each different social platform, market, or search engine you’ll be able to consider presents the choice to purchase adverts, so deciding which one to make use of is a matter of understanding who your buyer is and the place they spend their time on-line.

Make-up model Glossier makes use of social media adverts to search out prospects on-line.

Though every paid promoting platform has its particularities, they primarily all cost for consumer impressions (what number of occasions your advert is seen), utilizing a metric referred to as CPMs (price per one thousand impressions).

In addition they often enable advertisers to decide on who they need to goal, based mostly on demographics, pursuits, and different traits. By utilizing these focusing on parameters offered by a web based promoting platform, you’ll be able to slender in on potential prospects and purchase them by way of paid adverts. 


  • Quick development. In the event you’re seeking to quickly scale your online business, some would argue the quickest method to do it’s by paying for visitors. Your corporation is assured to get publicity, and with the suitable technique and optimization methods, companies have been capable of rapidly enhance their price range to amass prospects quickly. 
  • Focusing on skills. One of many nice benefits of paid adverts is the power to decide on precisely who your adverts are proven to. With Fb Advertisements, for instance, you need to use Curiosity and Habits focusing on to achieve virtually any distinctive area of interest based mostly on consumer conduct on the platform. 

Potential pitfalls

  • Costly. There’s an ongoing dialogue in regards to the rising CPM prices year-over-year of well-liked on-line advert platforms like Fb, on account of algorithm adjustments and competitors. Whereas it’s nonetheless attainable to amass prospects profitably, manufacturers could have to work on enhancing their web site conversion charge, buyer retention, and common order worth to offset the rising prices of promoting.
  • Studying curve. Operating paid adverts isn’t rocket science, however the intricacies of the platform could be sufficient to intimidate these with out expertise. Fortunately, now we have free video programs that cowl each the fundamentals of advert platforms like Fb and Google, in addition to weblog posts that get into the main points of optimizing and scaling your campaigns

Good for

  • Companies with a price range. Most promoting platforms don’t require upfront funds or minimal spends to entry their audiences, however that doesn’t imply they’re low cost. Being profitable at paid adverts requires testing totally different artistic variations, audiences, and general technique so as to be worthwhile, so those that have some cash to put money into advertising will profit long run. 
  • Companies with artistic belongings. One of many key elements to success with paid adverts is having the suitable artistic that may appeal to new prospects to your online business. In case your model has an archive of images, movies, and duplicate that may efficiently introduce new individuals to your product and convert them into paying prospects, you may need to take into account placing some cash behind them. 

2. Negotiate influencer sponsorships 

You probably have a advertising price range, one of many quickest methods to get your product or model in entrance of a related viewers is by paying somebody with a web based following to put it up for sale for you. Influencer advertising (by way of Instagrammers, YouTubers, bloggers, and so forth.) has develop into a well-liked type of internet marketing, even rivaling referrals from real-life mates, in response to a survey finished by Twitter.

The success of influencer advertising entails discovering the suitable influencers to advertise your product. The problem is figuring out those that have an lively, engaged following that might be all in favour of your product, in addition to the artistic means to supply content material that displays effectively in your model.


  • Model consciousness. With a whole lot of hundreds and even thousands and thousands of followers, working with massive influencers can carry individuals into your buyer acquisition funnel by way of model consciousness. With influencer advertising, you aren’t solely paying to amass new prospects but additionally to have your product uncovered to a wider viewers in order that when they’re available in the market on your specific product, it’s prime of thoughts. 
  • Area of interest focusing on. A micro-influencer, which is usually somebody with a smaller, extra devoted following, may give companies with area of interest merchandise instant entry to a related on-line viewers. These micro-influencers sometimes price much less to work with and have higher engagement metrics, which implies your sponsored content material is extra more likely to get observed by their followers and result in a better conversion charge of shoppers. 

Potential pitfalls 

  • Monitoring ROI. One of many shortcomings of utilizing influencers as a paid advertising channel is the dearth of in depth monitoring that the majority social platforms have for sponsorships. Whereas paid promoting platforms can observe those that view or click on in your adverts, most influencer posts should be tracked by way of UTM hyperlinks, low cost codes, and different artistic mechanisms. With out deliberately monitoring them, you run the chance of not figuring out whether or not a sponsorship produced gross sales or not.
  • Upfront funds. There are numerous platforms and consultants that may join your model or enterprise with influencers who will promote your product. More often than not, a creator will ask for an upfront cost within the type of cash or a product donation. This protects influencers in opposition to potential scammers however could be dangerous for companies since there is no such thing as a assure the influencer will assist you purchase prospects. Making a commission-based cost construction, solidifying your settlement with a contract, or utilizing an escrow service might help mitigate this danger.

Good for 

  • Merchandise that require demonstration. Say you’ve got a brand new, progressive product that the common client isn’t conversant in. A easy picture commercial may not be sufficient to drum up potential prospects. By working with an influencer, you’ll be able to have them take a look at out, demo, or present validation on your product that may be shared on-line to assist persuade potential prospects. 
  • Fashionable manufacturers or merchandise. Oftentimes influencers are seemed as much as for his or her means to find new merchandise or developments, whether or not or not it’s in style, meals, or expertise. If your online business or model has that “cool” issue, approaching an influencer with the chance to promote your product could be extra interesting, because it helps them maintain their viewers engaged, making it a worthwhile partnership on each side. 

3. Construct an e mail checklist 

Lead era is commonly step one to buyer acquisition. Producing leads entails amassing data from potential prospects so as to nurture them or retarget them with adverts to ultimately convert them right into a buyer. Most first-time guests to your web site most likely gained’t purchase on the spot, in spite of everything.

Accumulating e mail addresses is seen as probably the greatest lead era investments for buyer acquisition due to the income that e mail advertising produces for companies. In accordance with Marketing campaign Monitor, 59% of entrepreneurs surveyed see probably the most ROI from e mail.

There are many methods to construct an e mail checklist, from driving paid visitors to a web page with an e mail seize type to providing a welcome low cost in your web site for brand spanking new subscribers. As soon as your e mail checklist is constructed, you’ll be able to run e mail campaigns and arrange automated emails to ship focused messages to your checklist by way of e mail advertising providers like Omnisend or Klaviyo. These emails could be personalised and triggered based mostly on behavioral knowledge that can assist you flip leads into prospects.

A touchdown web page created by Harry’s to gather emails from potential prospects earlier than launching their enterprise.


  • Recurring income. One of many largest advantages to constructing an e mail checklist is that it offers you the power to market to prospects over a protracted time frame, extending the lifetime worth of every buyer acquired. As soon as the e-mail is collected, you’ll be able to arrange e mail automation to proceed partaking the shopper and recommending new merchandise. 
  • Buyer knowledge. Other than nurturing potential prospects, an e mail checklist may assist you discover new prospects utilizing “lookalike audiences.” Lookalike audiences are a software offered by promoting platforms like Fb and Google, the place an advertiser can add a CSV of emails they collected to search out customers who “seem like” the enterprise’ current leads.

Potential pitfalls 

  • Supply charges. As spam filters develop into extra refined, getting your emails delivered to somebody’s inbox has develop into more and more tough for manufacturers, with an estimated over 50% of emails thought-about spam. Personalizing your e mail communications and following finest practices in relation to e mail design might help enhance the deliverability of your campaigns.
  • Low-quality emails. Though a big e mail checklist sounds nice, high quality at all times overrides amount. Though some e mail acquisition techniques could also be working, you will need to analyze the conversion charge from every e mail supply to be sure you are buying high quality leads. One method to lower your e mail advertising prices is by repeatedly cleansing your checklist of those that haven’t opened an e mail from you in a very long time, in any other case often called your “unengaged checklist.” 

Good for

  • Companies with a number of/consumable merchandise. In case your product is consumable, and subsequently must be replenished (like espresso), or in case you have a line of complementary merchandise (like clothes), e mail can develop into your largest supply of recurring income. If your online business has a full assortment of merchandise you can proceed to introduce to prospects, you’ll be able to maximize your return on funding by retaining in contact with them through e mail and creating sturdy repeat buy habits. 
  • New product launches. In the event you’re nonetheless within the product improvement stage of making your online business, amassing emails might help you put together for a profitable launch. One well-known instance of constructing a pre-launch e mail checklist is the story of Harry’s, a males’s grooming model that collected near 100,000 emails in a single week. A ready checklist helps put those that are genuinely all in favour of buying your product onto an inventory and builds suspense round being first in line for one thing new. 

4. Begin a referral program 

A private suggestion from somebody goes a good distance. Analysis from Nielson has proven that word-of-mouth referrals are one of the vital influential types of advertising. Folks belief these they know, so when a pal tells them to take a look at a brand new product or model, they hear.

With the intention to use referrals as a brand new buyer acquisition technique, it’s as much as the enterprise proprietor to make it simpler for these loyal prospects to recruit their mates.

This may be achieved by organising a referral program through which your current prospects are rewarded every time they get somebody new to buy from your online business. Apps like Referral Sweet, Loyalty Lion, and all supply methods to encourage prospects to refer mates by way of advertising emails, reductions, and incentives for each the shopper and their new recruit. 

Self-importance Planet’s referral program encourages prospects to refer mates to obtain factors.


  • Low price. Since private referrals are so efficient, utilizing a referral program is often seen as a low-cost type of new buyer acquisition. The charges related to organising a program embody a subscription to a referral program app and the reductions given to the brand new prospects who’re recruited. 
  • Repeat purchases. Usually when a buyer refers a pal, they’re rewarded with a small perk, like a reduction code off their subsequent buy. This creates the additional advantage of encouraging repeat purchases from current prospects—an additional increase in income that may assist make your referral program much more worthwhile. 
  • Buyer loyalty. In accordance with a examine printed by a number of distinguished enterprise college professors, referred prospects are 18% much less more likely to churn than non-referred prospects and 25% extra more likely to spend extra over their lifetime along with your model. These numbers present that referral packages herald prospects which can be extra loyal and worthwhile for your online business. 

Potential pitfalls 

  • Low engagement. Whilst you could be excited to launch your referral program, there is no such thing as a assure your prospects will share that very same enthusiasm and need to take part. In case your prospects haven’t acquired good service from your online business or aren’t in love along with your merchandise sufficient to advocate them, a referral program may not be the suitable buyer acquisition channel for you.
  • Group and monitoring. Since referral packages can contain creating buyer rewards, monitoring who has referred prospects, and even loyalty factors for every buyer, staying organized is an important a part of making this system run easily. Because of this many companies use an app to prepare their total referral program. In the event you’re pondering of retaining observe of referrals manually, you could run into points that might frustrate prospects. 

Good for 

  • Companies with current prospects. It goes with out saying that to run a profitable referral program, a enterprise must have an current buyer base to work with. You probably have a low variety of current prospects, their referrals could not even cowl the price of organising a referral program.
  • Companies with loyal prospects. Whereas each enterprise needs to have loyal, engaged prospects who would like to share your merchandise with their mates, not all are strategically designed to do that. Having good customer support, fast supply, and simple returns all assist create extra loyal prospects who’re keen to refer their mates. 

5. Operating conventional adverts 

It seems that digital advertising hasn’t utterly killed old-school promoting, like print media and unsolicited mail, to amass new prospects.

Consumers trust traditional ad channels more than digital ones.

Analysis printed by MarketingSherpa exhibits client belief in conventional media trumps most digital channels.

With the ubiquity of show adverts, digital advertising efforts have develop into simpler for customers to disregard or decide out of by way of advert blockers. Conventional media, from small scale efforts like printed flyers to billboards and even TV adverts, could be a good method to diversify your buyer acquisition channels to achieve a brand new, focused viewers.

On the similar time, expertise has made important enhancements to each the prices and accessibility of conventional promoting strategies for small companies. There are actually apps like Touchcard that may connect with your on-line retailer and use buyer knowledge to ship out bodily postcards to your leads or prospects. 

Subway advert designed for Icon by THINX with a web based low cost code as the decision to motion to trace gross sales from this marketing campaign.


  • Reducing prices. In accordance with AdAge, the price to promote on the largest TV exhibits is lowering. Whereas the costs for a business on the highest 10 packages are far outdoors the price range of most companies, some analysis suggests TV promoting CPMs are as little as $2.26. In case your purpose is to achieve as many individuals as attainable for the bottom price, the broad and big attain of TV adverts may make financial sense on your model.
  • Shopper belief. The belief that customers have in digital adverts has elevated over time, particularly as extra well-known manufacturers start operating on-line campaigns. Nevertheless, print and TV adverts nonetheless prime the charts in relation to promoting channels that customers belief most, in response to a US examine printed by MarketingSherpa

Potential pitfalls 

  • Monitoring. The flipside of getting such a broad attain with conventional promoting is the dearth of precision monitoring that exists with digital channels. When operating a print or TV marketing campaign, it’s probably not attainable to at all times know the exact ROI from a marketing campaign, since those that view or take motion after seeing your adverts aren’t “cookied” like they’re once they go to your web site immediately. Nevertheless, some digital-first manufacturers like Icon above have demonstrated how integrating a first-purchase low cost code into their subway adverts might help observe buyer acquisition from these campaigns. 
  • Upfront funding. The price range dedication and lack of flexibility inherent to conventional promoting are sometimes seen as dangerous. Digital, programmatic promoting permits companies to pivot and reinvest based mostly on real-time outcomes from their campaigns, and be taught what works on a smaller scale price range. In the event you haven’t examined your advertising message in a extra versatile atmosphere first, the upfront funding of conventional media may go away you with disappointing outcomes.

Good for

  • Native companies. With conventional promoting bearing a heavy upfront payment, efficiencies in these channels could be discovered with native print, TV, and radio adverts. If your online business can solely ship to a particular state or is designed for a neighborhood viewers, like celebrating a metropolis’s sports activities crew, promoting in native media can reward you with low-cost attain whereas nonetheless being extremely focused. 
  • Companies with high-priced merchandise. Common order worth performs a big function in relation to high-priced media. Firms like Endy and Casper are recognized for investing in out-of-home promoting on public transportation to promote their mattresses, which regularly price over $1,000. In case your order worth is excessive and your revenue margins sturdy, the chance of spending on big-budget conventional adverts could be offset by the necessity for fewer purchases to be worthwhile. 

6. SEO 

When searching for a services or products, many customers start their search with Google. Creating web site content material that helps your model present up in Google search outcomes for related queries is named search engine optimization, or search engine marketing.

Doing key phrase analysis and implementing your findings right into a content material technique on your web site pages and weblog might help you climb Google’s rankings, bringing you search visitors full of potential prospects to your web site.

Inkbox ranks first for “non permanent tattoos,” a time period that has over 30,000 month-to-month searches. You possibly can think about the passive, intentional visitors this generates for his or her web site daily.


  • Passive, natural visitors. Each second, over 40,000 queries are entered into Google’s search engine, making it the most visited web site on the web. In the event you can optimize your web site and content material towards this purpose, you’ll be able to seize a small proportion of these trying to find merchandise in your area of interest and efficiently purchase them as prospects. 
  • Evergreen. search engine optimization is sometimes called a supply of “evergreen” visitors, since content material created and posted months and even years in the past, can proceed to rank on the primary web page of Google and drive visitors to your web site. An excellent piece of evergreen content material can carry your web site new visitors with out the necessity to repeatedly pay for each new customer. 

Potential pitfalls 

  • Gradual development. If you wish to present up first on Google’s search outcomes, you’ll be able to pay with Google Advertisements to be the primary sponsored hyperlink guests see. Nevertheless, if you’re aiming to point out up organically on the primary web page, it will probably usually take time and persistence for Google to acknowledge your web site as an authoritative supply.
  • Competitors. Although the time period “non permanent tattoos” has over 30,000 month-to-month searches, Google shows over 237 million outcomes for the time period. Sure niches are extremely aggressive in relation to search rankings, which may make rating on the primary web page harder. Instruments like Ubersuggest and Ahrefs might help you perceive the extent of competitors for various search queries and key phrases and supply concepts for much less aggressive alternate options. 

Good for

  • These keen to play the lengthy sport. search engine optimization finished proper is a measurable and dependable supply of natural visitors, however being profitable requires a constant effort and fixed studying. The Google algorithm is susceptible to alter and staying on prime of the newest methods on each the technical and inventive aspect of search engine optimization is crucial to creating this channel work.
  • Content material creators. Whereas search engine optimization could seem fairly technical, it’s broadly recognized that the standard of an internet site’s content material to fulfill searchers performs a important function in its means to rank in Google search outcomes. The flexibility to write down effectively and provide you with artistic content material concepts that align along with your key phrase analysis might help rank your content material above the competitors.

7. Creating a web based viewers 

With social media and its many platforms like Fb, Instagram, YouTube, and Twitch, people have been capable of appeal to big on-line followings of potential prospects. Firms like Sand Cloud and Gymshark have cultivated Instagram followings within the a whole lot of hundreds and even thousands and thousands, changing into influencers themselves.

<emGymshark has over 5 million followers on Instagram and constructed a group of brand name ambassadors who put it up for sale on the platform.

There are a number of methods to construct a web based viewers on social media. Nearly all of them require time, consistency, and content material to draw new followers and maintain them engaged. Your on-line following not solely lends your model authority, it additionally creates an viewers of shoppers you’ll be able to attain everytime you need to promote a brand new product or enhance gross sales. 


  • Natural visitors. Though there could be prices related to creating a fascinating social media account, it’s usually seen as a supply of natural visitors since they might help share your content material without cost. Viral movies can present up on the extremely trafficked trending or uncover web page of various platforms, and your followers can share your content material or tag your model, bringing you extra natural followers and potential prospects.
  • Social proof. Social media has no scarcity of seen numbers, whether or not it’s the variety of likes or feedback a photograph will get or your complete subscribers, all of those metrics lend authority to your model within the type of social proof. When potential prospects determine to examine your model out on-line (which they usually do), the dimensions of your on-line viewers and its engagement provides to its legitimacy.

Potential pitfalls 

  • Gradual development. If creating a web based viewers was straightforward, everybody can be an influencer. Constructing an natural following and turning it right into a buyer acquisition channel takes time, particularly in distinction to paid promoting. 
  • Algorithm adjustments. One of many largest threats to content material creators on any platform is a sudden change within the algorithm that after helped them achieve traction. In 2016, a few of YouTube’’ largest channels claimed that their views dropped as a lot as 30% on account of suspected algorithm adjustments. In the event you determine to construct a web based viewers, your means to achieve that viewers and convert them into prospects will at all times be managed in some half by the platform itself.

Good for

  • Content material creators. In the event you’re the artistic kind who’s expert within the space of writing, pictures, video, or simply usually entertaining individuals on-line, constructing a web based viewers as a type of buyer acquisition could be use of your expertise. 
  • Companies on a price range. In the event you’re strapped for money, creating a web based viewers organically could be a cost-effective method to appeal to new prospects. Not like paid adverts, there isn’t a hard and fast price related to exposing your model to new individuals. Quite than {dollars} alone, on-line audiences could be constructed by yourself creativity.  

How will you develop?

Whereas buyer loyalty and repeat purchases are an necessary ingredient to the general well being of your online business, attracting new prospects by way of buyer acquisition might help you develop past your present base.

Buyer acquisition is about demystifying how prospects uncover your model and why they purchase from you so as to optimize and scale that course of. This can assist you to spend your advertising {dollars} extra strategically and develop your online business steadily over time. 

Realizing which channels will work as a buyer acquisition software for your online business entails repeatedly testing new channels and approaches, permitting you to search out out what works finest on your distinctive enterprise and stopping you from being too reliant on a single supply.