Moving Past Focusing on CAC to Generate True Brand Loyalty and Customer Retention

Many DTC brands focus a great deal of attention on maximizing the outcome of their marketing and sales efforts. Customer acquisition cost (CAC) is calculated by dividing sales and marketing expenses by the number of new customers acquired in a specific period. It becomes a rallying point for many brands and a metric to be proud to publicize. 

Calculating CAC provides insight into what it takes to attract customers but does not provide detailed insights into maintaining them month over month and year over year. Understanding CAC is essential for success, but brands need to give the same, if not more, focus on metrics optimizing brand loyalty and customer retention as CAC metrics.

Securing customers and completing sales is critical for any successful marketing and sales pipeline. Upfront, it is very important to ensure that the highest number of qualified buyers are aware of an offer. The customer acquisition cost (CAC) is a good metric describing those upfront costs. The mistake many small and medium-sized DTC brands make is valuing CAC more than other metrics used to describe customer retention. Given the fact that 65% of businesses generate revenues from existing customers it makes sense to move beyond simply focusing on CAC and calling it a day. 

Focusing on CAC without working to build meaningful relationships with customers is a mistake. Missing this opportunity inevitably leads to churn as customers become complacent in an increasingly competitive online sales environment. Personalization and customer experience are huge factors today. Without efforts to refine sales and marketing output and expenditure, it is all too easy to watch successful concepts lose market share due to an inability to innovate and develop new methods for problem-solving. 

Be sure not miss the opportunity to harness the full potential of voice technology to drive your omnichannel sales prowess to unprecedented levels while reducing costs and creating a more engaging user experience. Ambient computing is changing the world and voice technology offers the leverage your brand needs to capture the moment and secure your position for the future. 


Attracting and Engaging Your Highest Value Customers 

Achieving a truly agile and efficient business requires refining efforts and optimizing outcomes wherever possible. Building on success and scaling results are hallmarks of customer retention and ensuring that your most motivated and qualified buyers complete the most lucrative sales every time. It's important to attract interest by offering a real value, being receptive to your customers, and refining your approaches to marketing and sales to ensure the best ROI matched with the most dynamic and personalized approach to building truly impressive customer experiences. 

DTC brands are often really focused on driving new customer acquisition. They report on how many new customers they've acquired but don't focus much on retention, which is where they really should focus. 

Since money has already been spent to convert a qualified customer, there is a need to budget for customer retention costs. Shifting some of the customer acquisition expenditure towards refining marketing and sales efforts on existing customers will extract more value from the people who already appreciate your brand and have been qualified through your sales pipelines. 

The world’s most successful brands focus on improving their CAC to LTV ratio. Understanding this metric allows companies to find the best way to maximize expenditure to drive the best possible results. By focusing on serving existing customers better, their LTV increases. This in turn creates a higher budget for focusing attention on improving CAC. 

Our existing customer bases represent an immense opportunity for generating true loyalty, which translates into long-term business success in a way that viral success cannot. All brands want to achieve huge jumps in users and customers and should continue striving to achieve that. However, there is immense value to building on past successes by optimizing efforts with current customers. 

Brands need to implement solutions that allow them to achieve a better ROI while also converting their highest value customers more efficiently. The more brands can do to remove hurdles to purchasing and drive opportunities to create value for buyer personas, the easier it is to maintain success. 

Customer retention is the key to building and scaling an agile, resilient, and successful brand. All DTC brands should work to improve their ability to convert their highest value customers at the lowest possible cost. 


Focus on Building More Highly Personalized and Cost-Effective Customer Experiences with Voice Technology 

Voice activated commerce is gaining traction in the hearts and minds of consumers around the world and by next year 70% of consumers will have switched to completing conversational sales processes instead of traveling to their favorite brick and mortar stores. Right before our eyes we are undergoing a massive technology overall that is transforming the way people interact with electronic devices and their favorite brands. Voice technology is driving new opportunities at the world’s most successful omnichannel sales specialists. 

Blutag is a turnkey SaaS solution that allows DTC brands to engage and retain their highest value customers sustainably and cost-effectively using Amazon Alexa delivery notifications and shipping notifications.

Ecommerce customers are turning to voice commerce and Blutag delivers a low-code turnkey solution that allows brands to build more highly personalized voice-activated customer experiences. 

Get started today. Drive better customer retention with Blutag. 

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