The Basics of Acquiring a New Customer
Existing customers are the lifeblood of any business. And while repeat business is crucial, the quest to acquiring new customers is equally vital. The trick is to identify the needs of new customers and find a way to address them by offering a unique value proposition.
Before the digital age, many businesses assumed what new customers wanted and made costly, oftentimes erroneous calculations. Their game of guesstimates would go on until the business struck gold and found the right product or service that solves their customer’s needs. In the digital age, however, we can be more articulate in pinpointing our customer’s needs and wants thanks to a treasure trove of data on what exactly it is that your customer wants.
Artificial intelligence is accelerating this for sellers, combining with their existing tech stack and applications to quickly process and analyze insights gathered from seller’s day-to-day activities.
How to Go About Defining a New Customer
Although it may appear to be a straightforward way to define what it means to be a new customer, there may be several ways to answer the question based on a few factors.
Let’s take a cursory look.
The Date of the Original Purchase
The easiest and most popular way to determine a new buyer is the date of first purchase ever with the given company. This can be done by going into their purchase history and identifying the first-ever purchase date. If your purchase history doesn’t go all the way back to the inception of the company, your first purchase date may be limited to the time frame that you captured.
If your database provider offers archiving services, it may be possible to save the first purchase date. Experts agree that tracking a customer’s first purchase through to their second, third, and fourth purchases can be used to analyze their path of purchase trail. This information can then be used to understand what your first-time customers want so you can better tailor your services to their needs.
New to a Specific Brand You Own
For businesses that maintain a portfolio of several brands, you can define a new customer as someone who has purchased from a specific brand. You could apply a stricter definition by stating that they only constitute a new customer if they buy across all brands. This, of course, may not be ideal for businesses that are just starting out.
For established businesses, this is a great way to measure customer acquisition and the overarching reach of their brand’s power. With that said, it does little to change the number of customers you have acquired for your entire brand ecosystem. You could view both metrics as a measure of success.
The fashion industry is more interested in knowing who is first to buy their seasonal product lines, especially ones that are released in the Fall and Spring months. While they may be interested in tracking the total number of new customers to their brand, they may want to learn who is new to their product lineup for a specific season.
This is useful data to track because there may be several customers who shop exclusively in one season compared to those who shop in more than one. Both categories of customers are just as important to the brand.
New to the Fiscal Year
Another way to define a new customer is based on purchases made in a new calendar year. This data is useful for tracking the number of new buyers you acquired and what you may be able to expect from this group in a new fiscal year. This metric will help marketers understand what proportion of their business is coming from new customers and any repeat business in that year.
The informant can be used to assess the value of your brand. For example, if the majority of your business is only coming from first-time buyers, you either just started out, or your existing customer base may have replaced you. In other words, this is an indication that it’s time to focus on more repeat customers by cultivating a positive relationship with your existing buyers.
Data Can be Confusing at Times
There are several ways of storing customer data. You could store them at the email level, address level, or household level. If your means of finding out new customers is by counting the number of email addresses in your database, you may be exaggerating the count.
Another confusing factor is that customers who are defined by their first and last name and address may be associated with multiple email addresses.
If you define a new customer at the household level, you don’t take into account the fact that there may be multiple people living at the same address. Or that the new customer may have vacated the premises and someone else may be buying from the same address. This new customer may be treated as a repeat buyer based on how you store your data.
Strategies to Find New Customers
In the search for new customers, it is important to provide a solution to a need or problem. As a business owner, try to put yourself in your typical customer’s shoes and empathize with their needs. It becomes easy to acquire new customers if you can gain a better understanding of their pain points and tailor your solutions accordingly.
How to Identify What Your Customers Want
The vast majority of your customers expect you to already know what their needs and expectations are.
The best way to identify their needs is to do what is known as a customer needs analysis. This will provide you with valuable insights about your customer base. Popular methods of finding out what your customers want are to perform keyword research, analyze your competitors who are doing well, and do social listening.
You could also carry out customer interviews to hear the story directly from them. Direct communication may be more reliable compared to other methods of research. However, it is important to ask specific questions to customers about the products or services they have used in the past.
Social listening is a more subtle approach to learning about your customers. You play the role of a spectator by monitoring popular social media channels relevant to your business and tracking conversations about a product or competitor.
How to Meet the Needs of a New Customer
When you focus specifically on the needs of a new customer, it becomes easier to solve their pain point.
The first step is to nail down your buyer persona by creating a customer journey map. This means finding out how the new customer is likely to hear about your brand, whether online, in person, or a combination of the two.
Use what you know about your customers to develop a unique value proposition to set yourself apart from your competition. This will allow you to deliver superior customer service and experiences.
Every successful business has one thing in common: identifying and meeting their customer’s service and product needs. Most business owners may find it difficult to create their customer journey if they don’t have enough data. This is why it makes sense to partner up with a media expert who can conduct a customer needs analysis on your behalf.
You can then create a marketing strategy to win over prospective customers. In the age of the digital era, you could leverage social media marketing, search engine optimization, and pay-per-click marketing.
What are the Benefits of Acquiring New Customers
Besides the obvious much-needed improvement in cash flow due to increased sales, there are several benefits of acquiring new customers. Let’s take a look at a few examples:
Improved Brand Awareness
You cannot put a price on brand awareness. It’s what makes industry giants like Apple and Microsoft infinitely more successful than their lesser-known counterparts. Your marketing campaigns can help potential customers recognize your brand when they need products or services, which will lead to significantly more sales and improved brand loyalty.
More Data for You
Data is the future of marketing, and businesses that leverage data analytics are leading the way. By adding new customers to your existing customer base, you can increase the amount of data and feedback you collect. This will help you gain more insight into consumer behavior and demographics. In turn, all this information you collect will be used to improve marketing efficiency.
Competing with other brands for new customers will incentivize your employees to create new products and improve their current offerings. This will have an impact on sales, market share, influence, and brand loyalty. By constantly innovating in your brand, your team will stay focused on the target goal while engaging with new customers and keeping the existing customer base interested in your offerings.
Tailoring Your Marketing Efforts to Acquire New Customers
Although marketing and advertising for new and existing customers may appear to be rather similar, there are several differences.
Customer retention is much cheaper compared to customer acquisition campaigns – for obvious reasons. Creating marketing campaigns for new customers requires a well-coordinated effort across several platforms to introduce your product, raise brand awareness, and demonstrate a unique value proposition.
Marketing to existing customers is relatively straightforward since they already know about your brand and your offerings. This lets you create simpler marketing campaigns to retain customers. The easiest marketing strategy for existing customers is to send them weekly or monthly newsletters to their email. In most cases, you probably already know their email address when they first made a purchase.
Knowledge of Customer Habits
Whenever someone buys your product, you learn something new about them. Their purchasing decision can be correlated with other information, such as site data and demographics. This kind of information can be used to create specific marketing campaigns for existing customers. However, campaigns for new customers will involve broad tactics to reach as many types of customers as you possibly can.
Visualizing the Acquisition Funnel for a New Customer
It helps to visualize the customer journey with the help of a funnel or a graphic that showcases the main stages involved in the buying process and the mindset of the prospective customer.
The idea behind the funnel is that customers gain more awareness about your brand as they progress through it. They will:
- Learn more awareness about your brand
- Contact you about your product or service
- Decide to become a paying customer for your brand
Lead generation begins at the very top of the funnel; lead acquisition happens somewhere in the middle and culminates in lead conversion at the bottom.
As discussed earlier, your main channels of customer acquisition will include organic search, social media marketing, and pay-per-click advertisement. These methods will help you attract new customers.
An all-encompassing digital marketing strategy requires a well-coordinated strategy between all your business units, including the customer service teams and the marketing teams.
It is your marketing team’s responsibility to develop new materials to generate interest in new customers. However, it is your customer service team’s responsibility to provide the best possible experience to clients. If you do it right, your current customers may become your best source of marketing.
To this end, your website will play an important role in engaging with new customers. For example, your website’s landing page may contain interesting visuals and text that could convince new customers to convert.
Bonus points if you can integrate a live chat tool into your website that allows prospective customers to speak to your team.
How to Acquire New Customers
Thanks to digital marketing, there are several ways of acquiring new customers – both through paid and free methods. Let’s look at the most commonly employed methods that you can easily scale according to your needs.
Organic search refers to search engine result pages, such as Google or Bing’s search result. Organic search marketing refers to any effort made to rank higher in search results for specific keywords.
To get the most out of organic search, you should learn more about search engine optimization (SEO). In simpler terms, SEO is a way of optimizing your content so that your customer can easily find it on search engines.
Besides, when was the last time you bought something off the internet without at least “Googling” it? In fact, you are more likely to click on one of the first results of the search page instead of scrolling to the bottom or moving to the second or third page
The main goal of SEO is to create optimized content that is likely to show up high on search engine result pages. This will immediately build trust with your prospective customers, who will want to click on your content. The psychological impact of being on the first page of Google or Bing simply cannot be underestimated.
And the best part is that SEO isn’t all that difficult. As long as your content is helpful to the end user and properly optimized for search engines, you should be good to go. You can also use intelligence tools to locate relevant keywords for your business and create amazing content that attracts your customers.
Social Media Marketing
You probably already know that prospective customers are more likely to listen to their favorite social media influencers before making a purchase decision. Hiring a social media influencer to promote your product is nothing new and has been done for decades in traditional media and television. And social media marketing makes influencers more accessible (and cheaper) than ever before.
And if you’re not ready for influencer marketing, you could build your own organic content and share it on your social media handles. You can even repurpose content from your existing blogs and videos. Being more creative and daring with your content may award you with more clicks and could help you go viral.
Pay Per Click Marketing
Pay-per-click marketing can be rather expensive, especially if you’re operating in a high net-worth industry such as dentistry, engineering, and even marketing itself. Many businesses supplement their SEO campaigns with their PPC campaigns, such as Google Ads. PPC lets you ‘hire’ the top position of a search engine until you run out of funds or you exit the campaign.
Although this may require lots of capital investment at first, PPC campaigns should help you acquire new customers extremely quickly. However, it is important to be careful in how you optimize your Google Ad campaigns.
Understanding the Psychology of a New Customer
The difference between a successful marketing campaign and a lackluster one is how you tap into the psychology of a new customer. When you have an excellent understanding of how a new customer behaves, it becomes easier to provide the best possible service.
One way to establish excellent rapport with your customers is to build a long line of positive testimonials. Many customers are more likely to trust online reviews instead of just taking your word for it. Of course, it isn’t possible to only have glowing reviews, and you can expect to receive a few negative ones here and there. The trick is to always provide friendly and supportive responses to the jilted consumer.
Wrapping Up – The Pain Points of a New Customer
Acquiring new customers requires knowledge. This means constantly learning about marketing trends and observing your competitors and others. Prioritize customer service above everything else – even profits – because happy customers will pave the path for repeat business and social proof.
Remember, client acquisition is never set in stone, and the process must be improved upon as necessary.