Acxiom is a customer intelligence company helping brands understand the customers they love and those they’d love to have. A leader in customer data management, identity, and ethical data use, we serve clients in the U.S., Latin America, Europe, & Asia.
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How brands can optimize their customer acquisition strategy
February 27, 2023
With inflationary pressures putting the squeeze on every consumer dollar spent, brands face tougher competition for each and every sale. This makes customer acquisition a huge challenge and priority for 2023. Acxiom’s Tate Olinghouse, chief client officer, shares how brands are investing in their acquisition strategies, the types of agility they need to embrace, and the marketing technology that makes it possible.
With the pressures of inflation and the prospect of recession, there’s no doubt brands are paying extra attention to their financials this year. They’re seeking guidance about how to adapt their marketing operations to achieve their growth goals within the economic constraints.
I know because I speak with brands about this - a lot. No industry is exempt, and it’s an ongoing conversation. Recently, I heard an economist frame the current challenge in a compelling way – one I think we could learn from.
It was this: consumer spending is still strong, so let’s assume the overall dollar spend that your brand is competing for stays roughly the same. But inflationary pressures are pushing prices up, so what happens is that the number of transactions gets squeezed down. Effectively you’re competing over fewer chances to make a sale.
When you look at it this way, you realize that the fight for wallet share is really a fight for a shrinking number of customer transactions. And when this is the case, one thing matters more than ever: getting customer acquisition right.
What is customer acquisition?
Acquiring new customers is the lifeblood of any business – certainly one that is growing. Andy Dufresne famously told his friend Ellis “Red” Redding in the classic movie The Shawshank Redemption, “Get busy living or get busy dying.” If customer acquisition is the lifeblood of a business – marketers need to get busy adding to and growing their customer base if they want to thrive.
A brand’s customer acquisition strategy should encompass all phases of the buying journey including awareness, consideration, decision, and purchase.Ultimately, it’s about how you find, connect, and create experiences for prospects you’d love to have. And when done right, those prospects become customers.
Customer acquisition strategies in 2023 require agility
Smart customer acquisition strategies are built on customer understanding, underpinned by data-driven customer intelligence. It’s not just about finding your next audience; it’s about understanding them - what they want, what they need, and how best to engage with them on their terms. It all requires data and insights, but equally important it requires two critical kinds of agility.
First, you need agility in your data environment – it is the foundation for customer understanding. Agility in your data environment allows you to adapt marketing decisions and pivot quickly – executing, analyzing, and adjusting at speed and scale across channels, touchpoints, and campaigns – in real-time.
If your customer data is not driving your strategies, you are missing opportunities to shift with the market. A big blocker every brand struggles with is the persistence of data silos. It’s understandable but not insurmountable.
Approaching your data environment as a customer intelligence asset that lives independent of applications and channels gives you the flexibility you need. When your customer intelligence layer lives independently, you no longer feel trapped or stuck in your systems. You will have the freedom to adjust your campaigns, partners, and technologies to meet your acquisition goals - even in the most dynamic of times.
Once you have an independent customer intelligence foundation, turn your focus to the second area of required agility: integrating with technologies, platforms, and partners that can provide flexibility in your campaigning capabilities.
Here are just a few of the most exciting technologies brands are investing in this year, as their marketing needs flex:
Data clean rooms (DCRs)
The rise of DCRs as a trusted way for brands to securely share datasets with other brands and partners has been an exciting feature of the past 12 months, with providers like Snowflake, Google, and AWS pioneering the tech. I’ve written about the new potential (and the tried-and-tested capabilities) driving all the hype behind clean rooms.
Customer data platforms (CDPs)
CDPs help brands create exceptional experiences through better management of their customer data acquisition and use. Think personalization, audience insights, and analytics. From the major marketing cloud providers, like Adobe and Salesforce, to independent providers, like Sitecore and Treasure Data, the CDP space is evolving quickly with better customer experiences at its heart. With over 150 CDP providers to choose from, it takes a bit of research to understand what the right CDP can do for you.
Netflix might be the one hitting the headlines with its ad-supported plans, but some of the most exciting developments are to be found in another type of ad network – retail media networks (RMNs) – which retailers are using not just to grow revenues but to grow the data streams that help them build better customer experiences. 2023 is set to be the year 'everything becomes an ad network.'
AI and ML
Brands are investing in artificial intelligence (AI) and machine learning (ML) to make sense of large volumes of digital interactions and customer data. But don’t let the buzz around ChatGPT and BARD fool you – there’s still a long way to go. Recent Acxiom research shows that only 23% of brands are making use of AI/ML for analytics. And while more have adopted AI for customer service, most of them have done so in silos. What’s needed here is a connected, cross-channel approach.
It’s important to acknowledge that technologies change - new technologies arrive, some evolve, and others dissolve. That’s expected and often leads to new opportunities for growth. But it doesn’t have to lead to a complete do-over. It’s yet another reason viewing your data environment as an independent and persistent customer intelligence layer is critical to long-term agility.
And while new tech can feel overwhelming, consider a partner to help you navigate. Services partners can help you choose the right technology to achieve your desired business outcomes, lead you through implementation, and provide ongoing support and optimization. After all, a services partner will have worked the challenge many times before, reducing the risk to you.
The acquisition opportunity
While there’s never been so many marketing channels to master, there’s also never been so much opportunity for brands to genuinely understand their customers through customer intelligence. However, when factoring inflationary pressures into the mix, this channel proliferation becomes a double-edged sword.
People want marketing on their terms - they expect personalized, relevant, respectful experiences, and brands have more opportunities to create those engaging experiences. With competition for sales so high, it’s imperative to operate from a foundation of customer intelligence.
The long and the short of it is this: customer acquisition has never been so tough, and customer acquisition has never been so important. If you can achieve agility in your customer intelligence foundation and the flexibility to connect to technologies that will allow you to deliver better customer experiences, you’re well-placed to get acquisition right this year.