The question every Start-up, every Marketing Director and CEO ultimately want to know.. How to ‘Reduce your CAC (customer acquisition cost)’.
Running a Business development agency, I understand more than most, quite how much clients want for their marketing spend.
The key way they can look at how effective their budget is being used is by their CAC (customer acquisition cost), which put a value on obtaining each new client. Once you have this, all you need to do is monetize the value of the client (bearing in mind the retention term, the life value of a client) and you have your return on investment.
So what are the most effective ways to reduce the CAC and increase R.O.I?
Use a Multi-teared Approach
Don’t ever solely focus on one approach, telemarketing, PPC, SEO, e-mail marketing.. all these lead generation strategies are very effective, however, if you focus all your spend on one channel and don’t have a multi-teared approach it can be expensive.
Instead, I’d always suggest a 2 or 3 step approach for example:
A) SEO/PPC – This is where you capture inbound leads (via form submissions / online enquires etc)
B) e-mail automation (Have a thought out series of e-mails to educate and nurture prospects)
C) Telemarketing / Telesales.. (This will be the step where you make a sale, set up a sales meeting or send more information to the prospect to create the next stage)
The reason that CAC is high for most companies is mainly in due to the lack of not nurturing the leads/prospects effectively enough. Rather than only engaging with the hot prospects or seeing the leads as long leads, most of the value never materializes.
If you generate inbound lead with digital strategies like SEO and PPC, you then need to effectively nurture these leads. If you effectively nurture these captured prospects, at whichever point they are on their journey from discovery to buying, you will be there to onboard them once they are ready to buy.