“Customer acquisition” is a fancy way to talk about finding new prospects and the process of developing them into purchasers. However you say it, it has always been crucial for the survival of any business, let alone its growth. For most businesses, focusing solely on existing customers won’t keep the lights on – there’s usually a limit to how much your business can offer any one person.
This is probably doubly true for online CE retailers. Challenges to acquiring new customers in the digital realm have accelerated over the last few years, for a variety of reasons. Competition can come from anywhere, and building relationships is tough in such a complex and changing media landscape. In 2019, a Worldwide Business Research (WBR) survey showed that 80% of digital marketers were under greater pressure to reach their acquisition – and earnings – targets than the year before. And the situation hasn’t improved since then.
Of course, the challenges faced by digital marketers mirror all the traditional ones — competition in a crowded marketplace, shrinking profit margins, logistics, customer relations, etc. But what is probably unique in the history of commerce is how the digital arena bombards potential customers with an overwhelming amount of advertising on virtually every platform.
Digital ad platforms target consumers based on their search histories and past purchases, which can be effective but also limiting. Did you buy a pair of headphones online? Be prepared to keep seeing ads about it for the foreseeable future. The ease and accessibility of online ad platforms mean that anyone can afford space, placing dubious medical products or “fake news” reports alongside legitimate offers.
This understandably causes distrust and seeding doubt among potential customers. Conversion rates seem to fall further every year, driving up consumer acquisition costs. Diminishing ad performance has been behind the plummeting value of Facebook and Google stocks, along with the rise of competing ad networks from Amazon, Walmart, and eBay. These new ad networks promote products in their own markets, putting further pressure on independent merchants.
Studies have also shown the detrimental effect on trust. In fact, consumer trust in advertising has been cut in half, from 50% favorable in the early 1990s to 25% in 2018, according to ad industry think-tank, Credos. Once lost, trust is very hard to win back, especially online. In the face of information overload, a retail showroom may start to look attractive.
Since trust is the most important pillar of the seller-buyer relationship, and it has clearly eroded, how can online sellers bring it back?
One way is to minimize the information-trust gap between seller and buyer. Provide accurate, verifiable information to your customer base, and present it in a way that’s inviting and educational.
But how? At Headphones.com we do this by not only hosting a huge collection of information on the world’s highest-performing audio equipment – including headphones we don’t even sell. We offer explainers on key concepts, roundup comparisons, and reviews from multiple experts. In addition, the products we carry are evaluated by our team of experts who put them through rigorous testing for performance, quality, and long-term customer satisfaction. Our editorial team is in continual conversation with our customer support teams to understand consumer questions, challenges, and feedback.
We offer our own forum to facilitate discussions between enthusiasts and this openness on our part gives our reader-customers trust in what we say. They can make wise purchasing choices based on trusted, easy-to-understand evaluations. To further engender trust, we remind consumers that our reviewers are 100% unbiased and that we accept no advertising money for positive reviews.
To complement this and build even more trust, we offer a confidence-building 365-day return policy. While this might seem extreme for many sellers, it underscores the fact that we stand by our products and our customers.
Our site also attracts enthusiasts — who are also potential customers — because we host an active and engaging information-sharing forum community for people who enjoy the luxury headphone/home audio experience, and contribute to industry forums on others’ sites as well. Several of our team members are known on a first-name (or internet handle) basis across these sites. This kind of outreach is unusual, but is a crucial part of our strategy: ongoing consumer education, community participation, and our no-fault return policy build trust and expand our audience.
CE resellers serve themselves well when they serve customers well. Don’t make assumptions about them. Talk to them. Respect them. Make them feel comfortable. That’s actually the most meaningful extension of your company culture and brand. For example, we see a lot of people get excited about headphones and click “checkout” and then – through second thoughts, spousal advice, or “buyer’s remorse –they decide to cancel the purchase. Unlike many online sellers, headphones.com makes it so easy and responsive that people often come back later and make an even bigger purchase.
About the Author
Andrew Lissimore is CEO/Founder of Headphones.com.
See also: Emerging Trends And Challenges That Will Change Future Supply Chains
