Customer acquisition is as old as ecommerce itself, but because it's been around for so long, companies often struggle to differentiate themselves.
Businesses looking gain a competitive advantage, however, should focus on mid-funnel acquisition – an area that will be increasingly important for customer-centric businesses going forward.
Epsilon has created a series of video and blog ‘explainers’ to guide you through key aspects of customer-centricity. Topics range from calculating customer lifetime value and boosting loyalty to customer acquisition and incremental growth.
What is mid-funnel customer acquisition?
It involves reaching out to customers that have already engaged with your brand but, not for a while and without converting.
Why it matters?
It’s no longer good enough to simply acquire customers for the sake of it. Consumers are becoming increasingly fickle, discount-driven and influenced by the free-returns culture. Businesses need to identify customers with a high lifetime value, which will offset the cost of acquisition.
Why acquisition is hot right now?
Multi-channel retailers have experienced a 44% surge in online revenue during the pandemic, as consumers switch from physical to online retail. The new normal means there is a massive new mid-funnel audience for online marketers to acquire.
But acquiring new consumers isn’t necessarily easy
There are a number of key trends that suggest there are still significant challenges to overcome:
- Google recently reported a 100% increase in the use of the phrase “should I buy” before a product or brand name. For example: “Should I buy an iPhone?” or “Should I buy a Dyson?”.
- McKinsey research suggests that 53% of consumers are reducing their spend.
These findings suggest that while consumers are engaging more with new brands, they are also much more apprehensive about spending their money.
In a nutshell
In a world where more and more consumers are buying online –but each purchase is significantly more considered – the mid-funnel shopper who has already shown interest in your brand previously, presents acquisition marketers with a highly attractive sweet spot.
Take these six steps to effectively target your mid-funnel customers:
- Work on customer identification so that you can analyse the increased traffic coming to your website and identify which visitors are previous customers and which are not.
- Group together existing (mid-funnel) customers and decide which are the most valuable, so you can build customer share with this segment.
- Identify your customer’s purchase cycle. Rather than talking to that person immediately, reinvest and talk to them during their next purchase cycle using what you already know.
- Understand your customers’ multi-device journey. Without this insight, one shopper browsing for a product using three devices will look like three separate people. Targeting individual customers multiple times is a sure-fire way to alienate your customers and exhaust your marketing budget.
- Adopt a persistent form of identification. Cookies need to be reloaded and replaced as they decay and fragment over time.
- Develop an on-going conversation. It’s no longer effective to simply show shoppers the same product they looked at on your website. Build your brand around that product, establish a connection with your customer and show them associated items with high relevance they may be interested in.
The bottom line
Acquisition has changed. There are huge new audiences to acquire, but a spray-and-pray approach to marketing isn’t cost-effective. Businesses need to identify the most valuable customers (those in the mid funnel) and develop an on-going conversation about the things that resonate with those shoppers.
You can find out more about acquisition and other key aspects of customer-centricity by watching our on-demand video series.