Acquiring high value, retainable customers

Abstract

The often cited poor productivity of new customer acquisition spending is in large part due to methodological neglect, particularly the ineffectiveness of the open offer-centric customer recruitment programmes. The author proposes an alternative, information-driven customer type-centric acquisition framework designed to increase the yield of acquisition marketing expenditures by leveraging the already available data assets. The proposed framework is built around strategic alignment and methodological parity of customer acquisition and retention efforts, bringing to light the benefits of targeted acquisition informed by retention trends. By dissecting the acquisition process itself, the analysis underscores the dangers of over-reliance on the discount promoting open offers, discussed in the context of adverse consumer selection. Lastly, addressing the need for accurate high value customer identification, the author presents an alternative operationalisation of that key metric, leading to the construction of the acquisition spending allocation matrix.