“With the growing cost of traditional online advertising and pay-per-click advertising, costs have risen so much that brands are looking for other ways to tap into new audiences,” Curie founder Sarah Moret told Glossy.
I’m sure that resonates with you.
And with the rollout of iOS14, ad tracking and performance have gotten even worse for most. Despite that, you probably should not stop your ads altogether—especially if ads have been your main customer acquisition channel.
But it might be worth diversifying your channels to lower your cost.
And that’s what this article is about. Let’s walk through six other channels and how you can get started.
Over the years, brands have shifted away from sponsoring only celebrities and influencers with huge social media followings to micro and nano-influencers, who have smaller but more engaged followings.
FIGS’ brand ambassador program
Scrub brand FIGS has hundreds of doctors, nurses, and other professionals in the healthcare sector as its brand ambassadors. In exchange for receiving free scrubs and invitations to events, these ambassadors post about the brand on Instagram and TikTok.
And it is paying off. According to Modern Retail, “These promotional efforts have helped to shape some of the company’s most impressive business metrics. Figs’ customer acquisition cost tumbled 61% between 2018 and 2020 to $39, according to its S-1.”
There is no one right way to “do” influencer marketing.
FIGS has a form for interested medical professionals to apply to be an ambassador. On the other hand, some brands rely on platforms like #Paid, upfluence, TRIBE, and minisocial to find influencers to work with. Some brands offer free gifts while others give cash upfront.
When you are just starting out, you could reach out to your top customers (or top referrers) to ask whether they would be interested in working with you. It’s best to understand what they would want in exchange (and it isn’t always money).
While not the easiest to get started with, partnerships are a good way to reach and acquire customers who have not heard of your brand. Partnerships can also help you create a unique product that customers would want, grow your social media following, improve your branding by associating with similar brands, and more.
CROSSNET and Black Wolf Nation
Here’s a wonderful win-win partnership between CROSSNET and Black Wolf.
People who play CROSSNET, probably always under the sun, would want to use sunscreen. By collaborating with Black Wolf, CROSSNET could offer a product that its customers would find valuable. At the same time, Black Wolf gets to reach a new set of audience that is likely interested in its skincare products.
have products people use together (but not competing)
In the example above, both CROSSNET and Black Wolf have personal and humorous branding. They both target people who like to be outdoor. And people who are outdoors likely care about their skin. Check! Check! Check!
Can you think of brands that match these criteria for your brand?
If not, a simple way to get started is to go to your Instagram profile and click on the tiny dropdown arrow. Instagram will suggest similar accounts for you to check out. Another option is to survey your customers about other products that they buy.
If you are feeling a little more advanced, you could check out tools like co-op to help find partners and Quantcast Measure to understand your customers better.
3. Referral program
A referral program is unlikely to replace your ads entirely but the cost of getting a customer through a referral program is much lower than through ads. For example, A Box of Stories and Love Yourself both adopted a referral program to lower their customer acquisition cost.
Riff Raff & Co’s referral program
Riff Raff & Co is one of our favorite examples because a referral program fits its business model perfectly.
It sells sleep toys for babies and toddlers to mothers. Being a mother, founder Emma Kruger knew that mothers usually hang out together and would chat about their experiences. And mothers trust other mothers more than anyone or anything else.
When a new customer purchases a sleep toy through a referral, she gets free shipping. On the other hand, anyone who refers five new customers gets a free sleep toy (worth $65). Almost one in every four Riff Raff & Co customers bought its product through a referral.
An affiliate program is best when your customers love your products and want to make money from recommending them. Affiliates are usually paid a percentage of the sales generated, so you are only paying for any results you get.
House of Wise’s affiliate program
House of Wise is a CBD brand that wants to help women improve important areas of their lives such as sleep, sex, stress, and finances.
“It was a way to build trust and confidence in our products. The cannabis market can be confusing, and I knew it would be important for women to hear about our products from people who had used them and achieved the desired results in the form of more sleep, better sex, and less stress.”
I recommend reading the full article if you are interested in trying an affiliate program.
Some products are more suited for an affiliate program than others. Two good questions to start with are:
Do people want to hear from a trusted friend before trying my products? Some products are impulse purchases. People would buy them simply after seeing an ad. But some products require a bit more convincing, which an affiliate can help with.
Would my customers want to make money from recommending my products to others? Some demographics, such as bloggers or content creators, are more interested in this than others. And they tend to be in areas like fitness, travel, and health.
Having done content marketing and SEO at Buffer and ReferralCandy (millions of monthly pageviews altogether), I know they help lower customer acquisition costs—not just for SaaS companies but ecommerce brands.
As Wong said in his Twitter thread, “SEO is a long game, but it's something that compounds overtime, so the earlier you start, the better.” This matches my experiences at Buffer and ReferralCandy. Both companies took years to build up consistent, high-volume organic traffic.
While ads tend to give you immediate results, organic traffic should eventually contribute the most to your customer acquisition because it is more sustainable and cost-effective. A good approach is to use ads to get early results while building up your SEO since it takes time.
Organic social media is another long game. I will tell you straight-up that it will be almost impossible to track sales from social media. But that’s not the point. Just because you can’t measure it doesn’t mean it is not valuable. As cliche as it might sound, social media improves your branding and improves the performance of all other channels.
The team regularly create new underwear prints and share hints and heads-up on their Instagram account.
Their customers, on the other hand, are constantly asking when new prints will be released so that they can buy more MeUndies as soon as the new prints are available.
The team wouldn’t know if someone sees one of their Instagram posts, goes to their online store, and buy a pair. But I’m confident people who have seen and interacted with their Instagram posts are more likely to buy when they see MeUndies’ ads or emails.
Getting started on social media is easy but doing well is hard. Randomly posting on social media isn’t a strategy (but it might take some testing to figure out what your audience likes).
The best thing to do is to follow a ton of brands on Instagram (or your preferred platform), see what they are doing and what is trending on the platforms, and test lots of content. In general, people want to be entertained or educated, so you could experiment with those types of content first.
The Later blog is a great place to learn more about social media strategies, trends, and tricks.
What am I missing?
There are other customer acquisition channels that I did not mention. For example, there is a whole other category of offline channels, such as in-person events, popup stores, retail expansion, and more.
What is working well for you? What should other marketers try?
Let us know in the comments below!
P.S. If you enjoyed reading this article and want to grow your ecommerce store, subscribe to our newsletter to get our latest articles and roundups.
A referral program is a deliberate, systematic way of getting people to make referrals to your business. Referral programs are often called word-of-mouth marketing, because they reward existing customers for sharing and incentivize new customers to try out your brand.