Tom Wozniak — October 14, 2019 One of the biggest challenges facing companies is acquiring new customers/business. Especially as companies grow, one way they may split their marketing department is into customer retention vs. customer acquisition teams. While the customer retention program focuses on keeping and growing the business from current customers, the acquisition side has the sometimes daunting task of going out and hunting for new business.
Depending on the industry and the company’s business model, these efforts can lend themselves to a multitude of marketing channels or only a few. In the digital marketing world, just a few common acquisition channels include Search, Display, Video, and Email. Many companies will leverage these channels either through their own efforts or through their ad agency, as they can all be highly effective at driving acquisition activity to varying degrees.
However, many companies that focus on these types of acquisition initiatives still reach a point where acquiring new customers becomes more difficult and/or less cost-effective. Simply pouring more budget into your Search, Display, or other acquisition focused advertising channels and media buys eventually leads to reduce overall performance and return on investment (ROI). However, there are numerous ways to access additional customer acquisition streams outside of traditional media buying.
Here are a few ways to extend customer acquisition programs by leveraging the capabilities of outside companies and third-party channels.
Partner/Referral Marketing
In many industries, one highly effective method of driving new business is by working with partners. These may be complementary companies in the industry that are integrated or otherwise already work closely with your business. They typically provide a different and non-competitive product or service, but still serve a similar customer base. A partner company like this can be extremely valuable by simply facilitating introductions to their customers or through a more formal referral program, where they are compensated for new business they drive to your company.
This type of partner referral initiative can have many advantages, including the fact that the intros or leads they provide are likely to be well-qualified since they know their customers. This helps ensure that the prospects they send your way are more likely to become your customers, as well.
Performance Agencies
One of the biggest challenges in traditional marketing and advertising is that performance is rarely guaranteed. Certainly, companies put their budgets toward channels that have shown themselves to perform well and drive a positive ROI. However, in many cases that performance may be expected or forecasted, but it isn’t a guarantee. Sometimes a channel simply stops performing or a campaign underdelivers against expectations when response rates are lower than expected. This is where performance-based agencies can offer a huge benefit. These companies often function like a traditional ad agency, but with the difference being that they only get paid based on the results they drive. While some agencies may be paid on a per-click or per site visitor basis, others are focused on a per lead or per sale business model. This means that an advertiser would only pay for the number of leads or new sales driven by the performance agency.
There are some big advantages to using a performance agency in this way, but like any marketing program, it requires careful oversight and management from the advertiser. The company should maintain a close relationship with the performance agency to ensure proper campaign guidelines are followed – from ensuring compliance with relevant laws and regulations to using approved creatives. It is also important to evaluate the quality of the leads or new customers regularly to ensure that they are meeting requirements.
Affiliate Marketing
Similar to a performance agency, taking advantage of affiliate marketing can offer significant advantages for an advertiser. An affiliate program delivers similar performance-based marketing, where affiliates are only paid for what they deliver (leads, sales, etc.).
Even more than simply engaging with a single performance agency or partner, developing and managing an affiliate marketing program requires a great deal of management and supervision. Each affiliate operates like a separate performance agency for the advertiser and many programs may have dozens or even hundreds of affiliates actively promoting the company’s product or service. Managing even a reasonably sized affiliate program can become complex, ensuring every affiliate is running their marketing programs according to advertiser guidelines, focused on compliance (like the CAN-SPAM Act for Email affiliates), and only marketing in approved channels. Because of this complexity, many advertisers use affiliate networks and additional tracking platforms to streamline the process.
These are just a few of the ways that advertisers can use third-parties to help augment their customer acquisition efforts.
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