5 Smart Tips to Lower Your (Customer Acquisition Cost)

5 Smart Tips to Lower Your (Customer Acquisition Cost)

Every company is searching for a holy grial to reduce their customer acquisition costs. But, not many are able to find it. In this blog, we have provided some smart tips to lower your customer acquisition cost.

Only the best and most innovative businesses can acquire new customers in the long run, but even they have to invest a lot of money in this process. By definition, customer acquisition cost is the cost associated with convincing a consumer to buy your product or service, including research, marketing, and advertising.

Now, the point is not to spend hundreds of thousands on customer acquisition. On the contrary, the real skill is to acquire new consumers using as little marketing budget as possible. It’s very difficult even for well-experienced marketers, but there are some tactics to help you with this. In our article, we will show you 5 smart tips to lower your customer acquisition cost.

5 Ways to Reduce Customer Acquisition Spending

Reducing the cost of customer acquisition is a matter of strategic thinking and analysis. You need to understand all aspects of the business to detect procedures that can be executed without enormous spending. We will present you with 5 tactics that can save you some big money along the way.

1. Redefine an average buyer persona

A vaguely projected buyer persona is one of the main reasons why marketers struggle to attract new purchasers. Before you start thinking about other elements of the customer acquisition process, you should take some time to analyze and redefine an average buyer persona.

Redefine an average buyer persona

We suggest you go beyond basic features like age and gender. Of course, you have to take into account both of these aspects because it’s not the same whether you market the product to a 15-year-old girl or a middle-aged guy. However, there are other highly relevant features to consider as well:

  • Purchasing power: You will hardly ever sell a super-premium product to customers who earn below-average salaries.
  • Education level: Marketers often use simple but straightforward language to advertise brands, but the way you approach the audience also depends on its level of education.
  • Location: Your marketing could look amazing to Chinese buyers, but what if you are selling products or services only in the US?
  • Values and lifestyle: Perhaps you guessed all of the previous elements right, but customer acquisition is still low. Maybe it’s because you don’t promote values your target audience nurtures, so be ready to change the tactics.

Now that you’ve determined all features of the buyer persona, you can describe this person precisely. For instance, it could be something like this: “John, 37, is a senior IT executive who lives in Boston. He graduated from MIT and tries to bring his casual lifestyle to the office“.

2. Analyze current customer acquisition spending

Once you’ve learned about the people you are pointing marketing activities at, you need to analyze current customer acquisition spending and see how it aligns with this target group. First of all, you should do some basic math and determine the cost of acquiring a new client. The formula is simple – divide total marketing costs by the number of buyers you gained within a certain time range.

For example, if you invested $10 thousand last month to attract 100 buyers, it means that you spent $100 per client. Don’t count only the first purchase and try to figure out the total customer lifetime value. It’s a net profit that you earn during the entire relationship with this consumer. Entrepreneurs usually neglect this element of marketing and don’t calculate customer lifetime value, which is why they end up spending more on acquisition than they could ever earn.

That’s why you need to align profit predictions with the average buyer persona. For example, if you are dealing with clients with below-average purchasing power, you can’t spend too much money on acquisition because they buy rarely and cheaply. Keep it in mind before you start throwing money on inefficient advertising.

3. Increase conversion rate

You are probably doing your best to increase website traffic, but even if you succeed - it doesn’t guarantee you higher conversion rates. In that regard, you need to analyze all segments of a landing page and see how they perform individually. This you do with A/B testing.

Increase conversion rate

According to the research, a typical website conversion rate is somewhat above 2.3%. However, conversions depend on various factors that you need to cover through A/B testing. Here are the website’s essential features:

  • Content’s copy
  • CTA layout
  • Structure
  • Images
  • Testimonials

A/B testing is basically a comparison between different solutions within the same type of webpage content. For instance, you could compare CTA1 with CTA2 and discover that the latter is much more productive. Just look at this example concerning event promotion:

CTA1: Click to apply.

CTA2: Book me a seat!

The two copies send the same message, but they are completely different in terms of style, which makes the second option much more efficient.

4. Utilize marketing automation

A study proved that almost two-thirds of very successful businesses use their marketing automation systems extensively. The benefits of such a system are numerous, while the sole fact that it eliminates the need for the human workforce is more than enough to convince any entrepreneur.

Utilize marketing automation

The cost of employing an email marketer is several times higher than buying software to do the job for you. At the same time, digital tools don’t take breaks or vacations. They don’t get tired and don’t lose focus. They don’t forget their tasks or due dates. All these things make marketing automation software more profitable than human-controlled projects.

Besides that, automation tools allow you to detect and target specific customer groups, thus contributing to the micro-segmentation of email marketing. You also get to analyze campaigns very precisely, creating reports and improving the overall productivity of marketing activities.

5. Don’t forget to retarget

How many times have you given up a purchase at the last minute? That’s just something average buyers do – they make sudden decisions or get distracted. For this reason, you need to remind those almost-purchasers about your brand, and retargeting is the weapon of choice in this case. According to a recent survey, almost half of search engine marketing professionals believe retargeting is the most underused online marketing technology.

But if you really want to reduce customer acquisition costs, you just need to catch a user in his or her buying mood. With retargeting, marketers trace digital leads of former website visitors and send them customized messages to match their inquiries. The logic is clear – all you do is remind potential buyers of products they used to explore a while ago.


Customer acquisition is not easy or cheap. On the contrary, it takes a lot of knowledge and skills to acquire new consumers without big budgets. In this article, we showed you 5 smart tips to lower your customer acquisition cost. Feel free to use our suggestions, and don’t hesitate to make a comment if you have other inquiries about this topic.

Justin is a blogger from Leicester, England, UK. When not teaching his little students and rooting for Leicester FC, he loves to share his thoughts and opinions about education, writing and blogging with other people on different blogs and forums. Currently, he is working as an editor at BestEssays. Follow Justin on Facebook and Twitter.

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