Customer Acquisition

Customer acquisition in 2023 - where should your focus be?

Joni Tillström
Customer Acquisition

Customer acquisition in 2023 - where should your focus be?

Joni Tillström
January 18, 2023

Setting the stage for effective customer acquisition

Acquiring customers is the lifeblood of all businesses, especially as there’s economical uncertainty clouding the horizon. As a player in the eCommerce sandbox, where should your focus be and what should you prioritize to ensure you’re running a tight ship?
Consider this your annual reminder to review that basics are up to par.

First order of business - user experience

I know, I know - this seems almost too obvious and dangerously close to being entirely redundant. But hear me out…

Let’s assume you’re sending thousands of visitors and prospective customers to your online store while spending copious amounts of marketing budget. They might browse for a minute, add products to a shopping cart or head out immediately, because the user experience of your storefront is a hot mess.

Filtering for relevant products is broken or makes absolutely no sense, product descriptions are incomplete or misleading, the site is excruciatingly slow on mobile or you have forty different options in your checkout flow for payment and delivery. Any of the previous examples are reason enough for an otherwise high-potential customer to get frustrated and head back out to Google's search results to look for a more pleasant shopping experience.

What should you do then? Start with the data you have; Use the analytics tools at your disposal, like Google Analytics or Microsoft’s free session recording tool, Clarity, to analyze how users are behaving in your store. Where do they enter, where do they exit and what kind of paths do they take? Make it your priority to understand what is introducing the most headache for your customers and begin formulating a backlog of development items to experiment with and alleviate those headaches to the best of your team's ability.

Most likely the final answer is a bit more nuanced, and might not be directly distinguishable from the behavioral data available in the aforementioned tools. If that’s the case, you can introduce a simple way to collect user feedback to complement your analytics to get a qualitative side to the story.

By improving the rate and volume of purchases in your online store, the better other activities further up the stream will perform as well. Make sure you're fixing an issue that matters and contributes to your bottom line, rather than spending time on insignificant tidbits here and there.


Next in line, pricing

Inflation has been running wild and wreaking havoc, affecting the costs of nearly everything that’s for sale which means pricing is more important than in recent years. Don’t get me wrong, I’m not about to say that ‘slash your prices, and eat into your margins to kick your customer acquisition into high gear’ but being vigilant on pricing is key, and your pricing strategy should at least be skimmed over to ensure it’s competitive in today’s market.

With regards to pricing, the self-evident starting is to review your objective: Is your objective to increase your profit margins or improve average order values? Do you want to keep current customers and encourage them to become repeat buyers or focus on attracting new buyers? Or are you sitting on a bunch of excess warehouse stock that you need to offload as quickly as possible?

Once your objectives are clear, dive deep into your customer data. Understanding your market demographics, what they value, and how much they’re willing to pay for your products is essential to setting prices and choosing an appropriate pricing strategy.

Having a solid pricing strategy enables you to reduce your reliance on constantly running discounts and offers. Constant discount campaigns can in the long run dilute your brand value in the eyes of your target audience and condition them to always wait for your next round of discounts rather than purchasing at full price. If you’d opt for a dynamic pricing strategy, you can utilize tools such as Sniffie to help you scale and optimize your pricing accordingly.In addition to the pricing of your actual products, the price of your shipping and delivery could be the aspect that kills your conversion on the last stretch. Offering free shipping to everyone is probably not feasible, but attempting to find the sweet spot for the price of shipping and free delivery could be the tipping point that gets the buyer through the checkout process.

The third point, maximize the output of your existing technologies

Many “technically inclined” people suffer from a little-known illness called Shiny Object Syndrome (SOS, among friends), meaning that for every challenge there’s a new, more advanced technical solution platform that could solve it. However, as belts are tightening and leniency in budgets becomes stricter it’s crucial to make sure you’re using your existing technology stack as effectively, efficiently, and broadly as possible.

Instead of trying to introduce a new piece of technology into your existing setup, audit and review your existing tools’ capabilities to see if there’s potential for improvements and ensure your capitalizing on every possibility the tools have to offer.  Unless you’re operating on decades-old legacy tools, I’m almost certain some areas are left unexplored in your current tools. It might not be straightforward, but most likely a more economically sound decision than adding something on top. Taking a pragmatic and critical look at your tools is another option. Have you overinvested in something state-of-the-art, that promises the moon from the sky but you’re only a third of the capabilities available? Moving to a lower tier or a simpler, more cost-efficient tool could be a viable option if you’re not locked into an extremely long contract that you’re unable to terminate.

Last but not least, (paid) acquisition strategies

The final note relates to the intelligent planning and execution of your (paid) customer acquisition efforts Take a holistic, full-funnel (or flywheel) approach to your customer acquisition where everything from building brand awareness to encouraging repeat purchases is in perfect harmony and complements each other.

Map out customer journeys, set specific, measurable, actionable, relevant, and time-bound (SMART) objectives, select suitable KPIs, and distinguish the most cost-effective tactics to move customers through the pipeline.

You should have a clear understanding of what your priorities are and how budgets are distributed. You could optimize your performance marketing activities to operate beautifully, but adding more budget results in diluting your cost efficiency which means you’ve exhausted that avenue, and the saturation point is reached. Broadening the scope and focusing your efforts on generating demand rather than capturing it is something to keep in mind. Build your brand, and improve consideration to later down the line converting that to paying customers.

Parting words

I’m sure you were expecting a concerto of technological wonders, AI-powered tools automating every aspect of your business, or revolutionary new methods that’ll be the silver bullet to put all of your customer acquisition concerns to sleep. The truth is, making sure the foundation of your business is solid and the strategy is sound, the results are often significantly better.

Need a fresh take on customer acquisition? Book a chat.

Drop us a note and let’s see what’s holding you back.