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New Customer Acquisition Part 2 of 2: Long Term Strategy

Posted by Laura Russell on July 6, 2020

In this second part of our customer acquisition series, we will share longer-term, strategic recommendations for brands and retailers to expand their customer base. In the first installation, we covered advertising tactics that brands can implement immediately. The team at Adlucent has found those approaches effective in acquiring the two general new customer types with growth potential: people in your current target market who have not shopped with you and people in your ideal target market. These tactics, however, will only work for so long if you are not differentiating your brand, creating a frictionless experience, and earning the loyalty of your future customers. 

We also want to caution that, while we are talking specifically about new customer acquisition here, many brands tend to neglect customer retention. Your existing customer segments, including new converters, high-lifetime-value, vocal advocates, and lapsed buyers, should be considered when developing your strategy and executing your campaigns. Most likely, they have growth potential as well, but you also want to tailor your approach in order not to alienate existing customers in your target market. The following are the three main strategies to consider when focusing on building your brand and acquiring new customers long-term.  

Brand Positioning

We find that brands that struggle the most with new customer acquisition are also those that fail to define and promote their positioning. The goal of your brand positioning strategy should be to create associations in your customers' minds so they perceive your brand in a specific, positive way. Many retailers have historically relied on their competitive pricing to differentiate or exclusive product availability in their niche. Differentiating on a mere commodity level has become increasingly challenging since consumers can now get any product they need and easily compare pricing on Amazon. Additionally, disruptor brands and those that traditionally relied on retail distribution are now selling direct-to-consumer. These brands' multichannel approach adds another layer of competition, and it is now challenging to differentiate on price alone. 

Additionally, ecommerce transactions have surged since many physical stores were forced to close due to COVID-19. Retailers that historically differentiated based on their in-store experience have been challenged to translate offline experiences online and rapidly adopt new technology. This presents a challenge for traditional brick-and-mortar retailers to improve their online customer service and offerings to create a memorable experience and stand out in a crowded space.

Many clients have also expressed that their main differentiator is that they are experts in their field and know more about a particular topic than any other brand. You may very well believe this to be the case. But, the fact of the matter is all your competitors also think they're the best. So, if you are not figuring out a way to make your expertise crystal clear to your customers through tangible deliverables and action, it won't translate into meaningful results. One way to be known for your brand's expertise is through delivering top-notch content. 

One facet of content marketing is cause marketing. To be successful leveraging social good as part of an overall marketing strategy, brands must stand for a cause authentically – without virtue signaling. Many companies have historically supported worthy causes and have earned a reputation for doing good in society, rather than just jumping on every latest bandwagon when new social causes are top-of-mind. For instance, REI has had a longstanding stewardship program. It offers full transparency, releasing a yearly report on their charitable efforts, which are thoughtfully linked to their values and mission as a company. In 2019, they invested over $8M in 427 non‑profits and gave back almost 70% of their profits to initiatives investing in the future of the outdoors. REI and Patagonia were some of the first brands to join the recent No Hate for Profit Facebook advertising boycott.

As the Black Lives Matter movement and racial justice have moved to the forefront of everyone's minds in recent weeks, cause marketing has become more prevalent across the board, with some brands taking a stand on issues for the first time. It is important to note that, if a brand chooses to engage in cause marketing, the chosen cause should easily relate to the company culture and strategy long-term. Beyond working causes into marketing messaging, brands need to exemplify their support through business operations, hiring practices, product development, fundraising, local business partnerships, and more.

It is often said that people don't buy what you do. They buy why you do it, which is increasingly true with younger generations, who are most likely to take into account a company's social responsibility when making purchasing decisions. They reward openness and authenticity, as well as companies that share their value systems. For instance, Fenty has been a strong example in taking a stand for Black Lives Matter in a way that is true to their brand and focused on meaningful action rather than posturing. On Blackout Tuesday, the brand paused all sales in solidarity, putting their money where their mouth was. They shared that simply posting a black square on social media was not enough to show real support. In general, it's a company that prides itself on what it does, not just what it says it believes in.

"Our approach to inclusion marketing has always been about 'showing, not telling.' Never once did we use the word 'inclusive' in our messaging." – Think with Google


Brands must continually innovate so customers remain thrilled and inspired. Companies should provide a frictionless experience as trends change, competitors enter the market, and shoppers' preferences evolve. One instance of ongoing skims nordstrominnovation is the partnership between Nordstrom and Skims, which helped Nordstrom appeal to a newer demographic, namely Kim Kardashian's fans, and to encourage them to engage with the brand and visit Nordstrom stores. A win-win for both brands, Skim was able to reduce friction and launch as a digitally native DTC brand, as they allowed shoppers to try on the products in person. Such long-term brand partnerships are a smart strategy for leveraging one another's strengths and acquiring new audiences. Retailer partnerships with DTC brands, specifically, are rapidly on the rise, with Nordstrom leading the way, not just with Skims, but also with other brands popular among younger demographics, such as Glossier and Everlane. Retailers aiming to remain competitive in the long term and hoping to differentiate themselves with an appeal to newer generations should strongly consider partnerships like these.

"34% of Americans surveyed said they are cutting down on traditional retail in favor of DTC clothing and apparel, and 35% said they are gravitating toward DTC beauty, health, and wellness products over those sold in traditional retail." - Katie Richards, Glossy

Another example of an innovative customer acquisition strategy is brands embracing new technology to reduce friction for shoppers and stay current with consumer habits. Especially when companies can make strides in their customer experience digitally, they have found even more success, due to the recent rise of ecommerce sales from COVID-related store closures. Seamless buy-online-pick-up-in-store (BOPIS) experience is expected now that it's become so popular. 

Brands should consider ways to connect virtually and offer simple customer service online since the human experience in-store is currently limited or on hold. Essentially all types of businesses have had to evolve their technology very quickly over the last few months to ensure they could stay in business once COVID hit. The ones that could do it seamlessly were able to adopt new customers, and the ones that fell short are now facing declining sales, frustrated users, and the risk of becoming obsolete. 

Younger consumers now expect social commerce as a given. Sephora has historically invested in innovative shopper experiences over the years, including its virtual makeup artist, which allows users to try on makeup digitally via their app. Most recently, Sephora has partnered with Instagram to be one of their first partners on Instagram checkout, which lets people purchase items directly through the social app – and it pays. Although some Sephora stores remain closed because of coronavirus, the company previously told Glossy that e-commerce sales had grown more than 30% during March. A company spokesperson said in both April and May that Sephora.com saw 67% year-over-year growth, explaining the push to capture more digital sales.

Continuing to innovate, not just during COVID but during any time, is important as consumers become increasingly dependent on technology. They have high expectations from the brands they shop with to keep up with their habits, wow them at every turn, and reduce friction along the consumer path to purchase with social commerce and innovative experiences.

Influencers & Brand Advocates

77% of people report they've purchased a product based on an influencer's posts, and businesses report making $5.20 for every $1 spent on influencer marketing. Some retailers worry that doing a promotion with an influencer will be a flash in the pan and provide a quick uptick in sales with a discount when it's posted, but won't be sustainable long-term. However, done well, an influencer strategy can be a valuable facet of a strong customer acquisition strategy. We all grew up seeing big-name celebrity sponsors on billboards and in magazine ads. Nowadays, leveraging influencers, including micro-influencers, to advocate for brands is very effective. Additionally, ad blockers are on the rise, with 45% of people in North America using them, and it's estimated that this trend is threatening $35B worth of ad revenue in 2020. influencers provide a viable alternative for reaching new customers even when they are blocking – and wary of – digital advertisements.

The goal should be to form long-lasting relationships with influencers from channels like Instagram, TikTok, and Youtube, leveraging them for product feedback and for reaching their separate audiences. There are a number of companies available to help with this process and build your network at scale. Influencer collaborators should closely align with your company's core values, have fans in your target market demographic, and create content in your vertical. They should maintain trust and offer consistency with their followers and should also take their time to get to know you and your brand to advocate for it authentically, versus only posting ad hoc promotions on their channel. 

Influencer partnerships are successful in driving new customer acquisition when done long-term because consumers who may have never heard of a brand previously can now discover it seamlessly. Brands benefit from increased exposure and an added layer of trust by association with admired influencers. 70% of people surveyed report that they trust their favorite influencer more than their friends, and 78% trust them more than traditional ads.  These statistics are impressive, but they are especially applicable to brands looking to engage Generation Z and Millennial audiences, which, combined, are considered the social media generation. However, brands may find success with more mature age groups as well, as social media is now highly adopted and mainstream for almost every generation. 15% of Baby Boomers and 19% of Generation X self-reported to have at least clicked through an influencer's product post on social media, according to a 2020 commerce report from Episerver.

Long Term Customer Acquisition, All in All

To make the most of customer acquisition, brands must consider the long term. From brand positioning to innovation and influencers, all of these recommendations will have a detrimental effect if launched haphazardly without research, a strong strategy, and testing to support them. Companies should be prepared to execute these approaches over 1-5 years, and they should revisit their plans annually to ensure they are working well, based on tracking new customer acquisition KPIs. As with all effective ventures, the key to long term acquisition and retention of new audiences is to plan the work and work the plan. With the right mix of tactics and guidance from digital marketing experts like the team at Adlucent, your brand can continue to reach new consumers and find continued success.

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Topics: competitive strategy, customer acquisition, digital marketing, Featured Post, New Customer Acquisition


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