Like any business you’re always trying to find a way to reduce your expenses – i.e costs of doing business. That includes what it costs you to acquire customers. Your customer acquisition cost is a big number that you should find a way to cut it down if you can.
Depending on your industry this can make a huge difference in your profitability. We discussed in an earlier blog post with infographic what the average customer acquisition cost by industry is. I would take a look at that before reading on.
Recommended Reading: Average Customer Acquisition Cost By Industry
Make your bottom line look better.
Increase your profitability.
Do you want a better looking bottom line?
Would you like to increase your profitability?
Your answers should be “Yes” and “Yes”
Otherwise shut your business down right now and go do something else.
Are you picking up what I am putting down?
So why should you keep reading this blog post until the end?
- We’re going to talk about how you can trim the fat from your customer acquisition process so you can reduce your customer acquisition cost.
Sound like a plan to you?
How to reduce customer acquisition cost in your small business?
- If you do a lot of face-to-face meetings with prospects which require you to travel, meet at restaurants, etc. You should replace them with webinars or virtual meetings.
This will still allow you to build a rapport with your prospect and have the feel of the face-to-face meeting like you were meeting in person. All without the expense of travel, lodging, or eating out at restaurants.
What are your thoughts?
- Instead of attending all industry trade shows in a calendar year, only go to the ones that are the most important ones. You know which ones those are where you consistently get plenty of high quality leads, that turn into customers.
This is one of the easiest ways to reduce your customer acquisition costs. It will only take you a matter of minutes to figure this out. Unless of course you’re not keeping track of your return-on-investment for each trade show you attend.
But, I know that is not the case. Right my fellow small business owner?
- Evaluate your email marketing service and see if there are any comparables out there that will meet your needs, while reducing your costs.
What do I mean by email marketing service per se?
The services that allow you to conduct your email marketing campaigns in addition to storing all of the email addresses for your prospects and customers.
You can use a number of different services and pretty much all of them can handle your needs.
What are the names of some of those services?
Here are a few.
So, shop around. Leverage these companies against each other to get the best deal. Put your negotiating hat on and see what you can do as far as reducing your email marketing customer acquisition costs.
As it relates to email marketing I would take a quick peak at this blog post we wrote recently. There are some really good tips you ought to know.
Recommended Reading: Email Marketing Tips For Customer Acquisition
- If you’re using any kind of direct mail for your customer acquisition efforts, I would eliminate it and substitute with something else more cost-effective.
- Are you using PPC (pay-per-click) advertising – Google Adwords, Facebook PPC, Twitter PPC, YouTube PPC, etc. as part of your customer acquisition process? Get rid of it and replace it with a more cost-effective option.
Direct mail is very costly and you can save a lot of money by eliminating it and replacing it with something else.
Pay-per-click advertising can add up very quickly driving your customer acquisition costs through the roof before you know what hit you.
What can you replace direct marketing and pay-per-click marketing with?
I recommend you replace both of them with content marketing – commonly referred to as blogging.
Why content marketing?
Per dollar spent content marketing generates 3 times as many leads as compared to traditional marketing. (Source: Demand Metric)
Generating 3 times as many leads means what to you as a small business owner?
More leads = more customers
Could you use more leads for your business?
Can you use more new customers?
So, it’s a no-brainer to ditch those other costly customer acquisition tactics for content marketing.
What say you?
- One often overlooked way on how to reduce customer acquisition cost is by sending or sharing your marketing pieces electronically via email.
This will allow you to save hundreds if not thousands of dollars on an annual basis.
How much do you spend on printing costs per year?
You should know this, but if you don’t sit down grab a pen and paper to figure out how much you’re spending on printing costs per year.
I guarantee you that number will surprise you, thus why it is often overlooked as previously mentioned.
I am eager to know what you find out.
So, there you have it.
How to reduce customer acquisition cost so you don’t go bankrupt.
Did I forget anything?
Do you have anything else to add to this list that would be helpful?
If, so please share in the comments below.
Do you have a customer acquisition process in place for your business?
Is that process working?
Is that process efficient?
Is that process cost-effective for your business?
If you could improve that process would you?
Do you need help in figuring out which parts of your process should stay or go?
If you’re answering “Yes” to all of these questions then my hats off to you. Business must be awesome!
Otherwise you and I should talk. Let’s see how I can get you to where you want to be.