Select Page

Acquiring customers is something to celebrate, whether you are a new business or fully established. Every business needs a loyal customer base for success, and to do so, you need to have a long-term, sustainable customer acquisition strategy. Constantly changing trends and media channels mean businesses need to evolve their tactics regularly.

Although acquiring a customer costs five times more than selling to existing customers, you still need to reel them in at the start to show them what you can do.

This article looks at e-commerce customer acquisition channels, the metrics you need to measure, and the primary focus for both new and established businesses.  

Customer Acquisition Channels

There are many customer acquisition channels to consider in an exponentially growing digital landscape.

Online Customer Acquisition Channels

In the 21st century, the number of online customer acquisition channels vast. If we look at the share of e-commerce total global retail sales between 2015 and 2021, it is clear that online traffic is booming.


Research shows that only 56% of Gen Z consumers purchased in a physical store in the period six months before being surveyed. So, how do you go about acquiring customers via digital channels?

  • Organic/SEO – conduct keyword research to understand what your target audience is searching for and use those words and phrases in the site content.
  • Paid search (PPC) – Like SEO, PPC is keyword-oriented for customer acquisition. However, whereas SEO is a long-term strategy, PPC can deliver immediate results. In bidding on keywords efficiently to target high converting audiences, you can find yourself at the top of search engine result pages (SERPs) and quickly pick up new customers.
  • Display Ads – a display ad can help you achieve a high ROI, albeit with a lower click-through rate, when you do not target exact phrases like PPC and SEO strategies. A successful display ad is engaging and draws in new customers. For example, The New York Times released the ad below at a time when fake news is prominent in the media. The ad is simple yet effective, with a personal call to action.


  • Social Media – According to Statista, nearly 50% of the world’s population uses social media, making it a critical channel for customer acquisition. Moreover, 54% of social browsers use social media to research products, playing into the hands of e-commerce stores.  The reach of social media gives you a vast target audience. If you listen to and engage with them, you can serve them personalised ads to drive your acquisition strategy. 
  • Content Marketing – original content that answers customers’ questions and prospects can put you at the front of mind with audiences. 94% of marketers agree that original research elevates brand authority. For example, if you Google “HubSpot” who primarily offer small business CRM solutions, search results are filled with useful blog posts. Businesses will think of them when looking at CRM solutions as a known brand.
  • Affiliate Marketing – A Forrester study found that affiliate marketing is ranked number one for customer acquisition and a primary driver for revenue amongst practitioners. Amazon built its business through affiliate marketing, which shows you the potential for scaling up.  You can set up an affiliate program and work with bloggers to promote your products or offer incentives for those who bring you converting visitors. 2 of the main affiliate networks to check out are CJ Affiliate (formerly Commission Junction) and ClickBank.

Offline Customer Acquisition Channels

Although digital channels are essential to success, there is still a place for offline advertising. If budgets allow, TV and radio advertising, direct mail, events, and trade shows can still be profitable for customer acquisition. These channels tend to be industry dependent.

For example, if you are a startup, you could target a local community by hosting an event and letting people try your products or service. QR codes are an excellent offline technique for integrating with the digital world. Banners and billboards can act as a way of building credibility if you are starting out and need to generate awareness.

Knowing your metrics

It is essential to be able to track the success of each customer acquisition channel. Measuring your customer acquisition cost (CAC) is the best place to start. CAC is calculated by dividing all your costs spent on acquiring new customers by the number obtained in the same period. For example, if you spend $500 in a year and acquire 500 customers, your CAC per customer is $1.00. The CAC value should be consistently measured for every channel, without bundling them together. If you put a long-term strategy like SEO into the same CAC as PPC, which is a short-term strategy, it will render it near impossible to know which is working.

Customer acquisition cost calculation


CAC can become deceiving as marketers can almost pick and choose which costs they take into account, and because a specific profit is associated with each customer, comprising of more than a one-off sale. Customer lifetime value (CLV) is the second critical metric. CLV tells a company how much revenue one customer will likely generate over the course of a relationship.

Ultimately, you need CLV to be higher than the CAC otherwise you will be making a loss on each customer you acquire! CLV is calculated by taking the annual revenue per customer and multiplying it by the length of your relationship in years, then minus the CAC. HubSpot offers a guide that breaks down all the calculations for CLV.

What to focus on when starting out

For a new business, you want to put all your focus on customer acquisition, finding a few customers, and gaining momentum. The objective should be to test as many tactics as possible to find out what works for your target audience, and double down on them. You cannot look at ways to retain customers unless you can get them in the first place. At this point, it won’t be easy to ascertain an accurate CLV as you won’t have enough data, but keep on top of your CAC for every channel.

Optimize your e-commerce sales funnel to get the most out of your visitors as this will play into a retention strategy later.

Customer acquisition funnel


The funnel looks at all stages of the website journey and how your newly acquired customers behave. When they don’t convert, review the stages they drop-out, optimizing the experience to get the most out of your visitors.

What to focus on when you’re established

As you work out the customer acquisition tactics that work for your target audience and become more established, you can start to shift focus. Repeat customers are responsible for 40% of a store’s revenue, with on average only 8% of customers making up 40% of your overall business revenue.

Customer acquisition vs retention


Once you understand the channels that work for and build customer advocacy, it is time to put your efforts into retention strategies. After one purchase, there is a 27% chance of a customer returning to your store, and that doubles to 54% if they make three purchases.


Suppose you compare these statistics to acquisition, where 98% of new customers visiting an e-commerce store without making a purchase, the value of retention marketing speaks for itself. The question is, what do you do to get customers to buy again?


A retargeting campaign aims to bring back that 98% of people who leave your site without buying anything. Have you ever visited Facebook and wondered how the ad is coincidentally linked to products you had just been looking for? It is no coincidence, brands are retargeting you to get you back to the store. For example, J.Crew retarget on Facebook offering a discount, knowing you are in the market. We delve into this in much more detail in our article on Abandoned Cart Retargeting


Average order value

Once customers are familiar with your brand, they are comfortable that you provide value. With that additional equity, you can look at ways of increasing their order value. 50% of marketers say they employ each of the four strategies below to increase the average order value of existing customers.

You can start recommending products based on order history, offer relevant promotions, shipping thresholds, and product bundles. Loyal customers will snap up offers from brands they trust.

Email marketing and loyalty programs

52% of American consumers will join the loyalty program of a brand they make frequent purchases from. As well as this, 57% of consumers spend more with brands to which they are loyal. Email marketing & customer loyalty programs gives customers a reason to engage with your business and generate relevant content for your email campaigns. For example, Vape Club sends positive messages to their customers after making a purchase.


72% of customers prefer to receive promotional content via email than any other social channel.


The key takeaways from this post are:

  • You need to have a long-term, sustainable customer acquisition strategy.
  • You should use multiple online and even offline channels to acquire customers.
  • New businesses need to focus completely on acquiring new customers – test as many tactics as possible to find out what works for your target audience, and double down on them.
  • Acquiring a new customer costs 5 time more than retaining an existing customer
  • Once you are established you should shift your focus to getting the most from your existing customers by retargeting, increasing average order value and running email & customer loyalty programs.