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Lean Startups: How to Manage Your Customer Acquisition

The entrepreneur’s list of concerns doesn’t not end in achieving the product-market fit. The next significant hurdle to overcome is how to actually get these consumers right into the front door of your store or at the landing page of your online shop. This next step is called customer acquisition.

Customer acquisition is just one of the three components of the cycle of selling to customers – getting customers (acquisition), keeping customers (retention), and growing customers (expansion).

Customer acquisition is creating demand and activation

With the proliferation of internet use and the rise of the social media, there are now a lot of creative and innovative ways of acquiring new customers for lean startups.

One way of getting customers is by creating demand. Using paying media like Google AdWords, Facebook ads, and other possible channels to reach these customers could create raise the level of awareness and interest on your brand, and eventually the demand for it.

Customer acquisition is to entice these customers to actually visit the physical store of the online shop. Once new customers have been acquired, the next goal to achieve is somewhat activate them.

Activation could be in a form of getting them to type in their email, of getting them to use a product and try it on, or of getting them to purchase the product or avail of the service being offered.

The customer archetype

The need for establishing a customer archetype arises from the need to know something in detail about those customers, you need to be empathic to understand them.

In order to create demand and activate them, it is an imperative to know more about the potential customers and understand their behavior. This is because purchasing behavior could actually help in determining the most effective place to create a demand in and activate.

But what exactly is needed to know about the customers? Everything. What are these people doing from the minute they get up to when they go to bed? And more importantly, where are they living? What are they driving? What do they read in the morning? What sites do they visit often? What do they listen to? What kind of gadgets are they using? What kind of apps do they use?

Most of the information you get from customer archetypes may seem extraneous at initial glance, but are actually very useful in the long run. Not knowing everything about the customers could lead to missed opportunities.

In the beginning of the startup, the customer archetype is also just a hypothesis. So what could be done during the entire process of customer development is to tie the customer archetype hypothesis the customer acquisition program hypothesis by running a series of experiments.

After the experimentation, decide hypotheses passed or failed. If it passed you proceed and spend more money on that archetype.  And if it failed you go and find out why it failed and try something else.  And so these are continual series of cheap and fast experiments on the archetype.

Common mistake in customer acquisition programs

One big mistake some entrepreneurs do is to jump the gun at some point of the customer archetype experiment and spend all the money in it. Before claiming you got the right customer type, be sure that you have exhausted experimentation a number of times until you find something repeatable in acquisition programs.  This is when then you pour in the money.

Take note that until you don’t fully understand your archetype, the process should go on and on. Because if you don’t understand it, you are just guessing. And at a high cost as that.

Another mistake is hiring and spending media dollars on an advertising agency at this early stage of the startup. This will be a waste of money not. You won’t need an agency at this point of your venture. It would be more beneficial that that learning process is undertaken by you as the founder and your team at the beginning so that you could get a full grasp of the market place. This is also a strategy of using acquisition dollars at the right time.