What's Your Customer Acquisition Strategy?

Lack of data prevents retailers from maximizing customer acquisition efforts

January 16, 2015 | Retail & Ecommerce

Customer acquisition is top of mind for many marketers. Retailers want to know how to draw in and retain new customers, but many are unsure of where to find them and how to target them.

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In a study from COLLOQUY, which provides loyalty intelligence, and Chase Merchant Services, 60% of US retailers said they lacked reliable data to execute effective customer acquisition initiatives. Most of all, retailers feel they need to understand how, where and why consumers spend in order to target them better. Nearly eight in 10 polled agreed that understanding consumer spend outside of their locations and properties would be an asset to customer acquisition, yet only around half of respondents reported using that type of spend data outside of their own retail locations.

According to a Shop.org and Forrester Research study from earlier this year, search engine marketing—including paid keyword placement, pay-for-performance search and search engine optimization—proved to be the most effective customer acquisition channel for US online retailers (85%).

Other tactics barely came close. Only four in 10 retailers ranked organic traffic and affiliate programs among the top strategies for acquiring new customers. And way at the bottom of the food chain sat social media platforms such as YouTube, Pinterest and Twitter, along with Product Listing Ads and on-site pop-ups and sign-up incentives. They may work for brand awareness—and pop-ups maybe for annoying customers—but they don’t seem to work for driving new customers into the top of the funnel.

Three-quarters (76%) of retailers polled by COLLOQUY and Chase said strategic partnerships with complementary brands would help solidify the value proposition and the brand’s position to potential consumers. Not to mention, partnerships enhance both side’s positions with little extra cost.

But as valuable as customer acquisition is to retailers, customer loyalty may be even more so. In order to add value to pre-existing relationships, 61% of retailers reported rewarding repeat customers with points or benefits, and 85% were trying to devise ways beyond discounts and promotions to add value to their customers. But retailers have yet to crack the code on how to find new customers and retain them across channels.