Counter the rising cost of paid customer acquisition

Over the years I've been collecting a various studies and reports on industry metrics for ecommerce and retails stores. More recently I've begun to organize them and start incorporating them into the advice in Repeat Customer Insights.

One thing that keeps coming up again and again every year is the cost of customer acquisition. Primarily, that advertising-based acquisition is more expensive every year and most of that cost is going to the big advertising platforms (Google, Facebook, Amazon).

That's a clear sign to me that while advertising can be an effective growth tactic, it's going to become less and less effective if you're not constantly improving how you use it. That might be optimizing your messages and targeting to squeeze a better CTR and CAC. But you'll hit a ceiling at some point and then what?

(Not to mention how the platform rules keep changing and more and more people are getting their ads shut-off with no recourse)

An alternative is to build an effective non-advertising channel. Earned or organic traffic has been around longer and has the potential to be even more effective for less cost. I think its requirement of long-term persistence scares away many stores.

Consider this though:

What if you were able to cut 100% of your online advertising costs? Both money and time dealing with online advertising. What would that free up you?

For some stores that number means the difference between getting-by and thriving.

10 years ago was the best time to build up your earned traffic channel, but today is still a great time.

Eric Davis

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Topics: Advertising Customer acquisition

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