A Customer Acquisition Strategy for a Digital-First World
The effects of the COVID-19 pandemic on consumer behavior have accelerated an already growing e-commerce industry, and as a result have forced retailers to re-evaluate how they can capture their share of this growing market.
Given this shift we’ve seen in consumer behavior, it’s imperative that retailers prioritize online customer acquisition. With vaccination rates on the rise and the pandemic waning, consumers are likelier to return to some form of their pre-pandemic shopping behaviors, however, they’re not going to sacrifice convenience. Therefore, the digital experiences that consumers have adopted during the pandemic, such as in-store and curbside pickup of online orders as well as home delivery, figure to be part of the retail landscape moving forward. As such, getting shoppers’ to your brand’s digital properties and then converting them once there will remain a priority for retailers.
To address this dynamic, Total Retail, in conjunction with Connexity, a performance marketing and technology network helping retailers acquire customers and drive e-commerce sales meeting return on ad spend (ROAS) objectives, recently produced a whitepaper to guide retailers through the online customer acquisition process. The report, Investing in Future Growth: A Playbook for Customer Acquisition, seeks to help retailers find more volume, less risk, and higher margins by diversifying customer acquisition channels.
Retailers should be evaluating the right mix of performance marketing channels, including paid search and affiliate, to optimize their online customer acquisition efforts. That analysis should include ROAS data, ensuring that budgets are correctly allocated to the channels producing the best results. For example, if paid search has proven effective at driving site traffic, and that traffic is converting at or above your overall site conversion rate, consider how that spend can be further optimized — e.g., enhancing product data to create additional, non-competing listings that extend your brand’s reach in Product Listing Ad (PLA) results.
When evaluating performance marketing solutions and ad networks, determine which are driving incremental traffic and sales at a cost that aligns with your established ROAS goals. Keep in mind the dynamic nature of the digital retail ecosystem, and ensure your marketing campaigns and budgets are easily adjustable for seasonal peaks and disruptions.
Let’s take affiliate marketing, for example. By paying a commission to an affiliate (i.e., publisher) only when a sign-up or transaction occurs, retailers limit their risk exposure and get a conversion at a cost that aligns with their ROAS goals for the channel. Furthermore, retailers benefit from free brand exposure and targeted clicks because they’re only paying after the customer’s desired action has occurred. Given rising online customer acquisition costs, identifying performance marketing channels that are producing desired conversion metrics at a sustainable ROAS, and doing so in a proactive manner to keep pace with shifting consumer behaviors, will be key to future e-commerce success.
A combination of cost-per-action (CPA) and cost-per-click (CPC) models across both paid search and affiliate marketing can help your business generate optimal ROAS for its online customer acquisition efforts. Finding a partner that offers the scale, technology solutions (e.g., proprietary bidding algorithm), and performance necessary to compete in a hypercompetitive e-commerce market, as well as end-to-end account management, will help your brand be found in a time when so many people are searching.
You can access the complimentary whitepaper, which includes data, insights and tips to help your retail organization optimize its online customer acquisition efforts, here.