Running a business often means prioritizing customer retention over acquisition, especially when acquiring a new customer costs five to six times more than retaining an existing one. Yet, during the holiday season—a critical time for boosting sales and building relationships—this mindset led many companies to focus on short-term gains in 2023.
Best Buy is an excellent example of this strategy. The company generally focuses heavily on customer retention through its loyalty program, which offers rewards and exclusive discounts to repeat customers. However, during the 2023 holiday season 2023, they launched a high-profile Black Friday campaign that was heavily advertised across multiple channels, targeting first-time customers with steep discounts on high-demand electronics.
Best Buy’s approach underscores the importance of balancing short-term gains with a long-term strategy. Neglecting to factor in customer lifetime value (LTV) leads to missed opportunities for sustainable long-term growth. This is especially true during the holiday season when the potential to cultivate long-lasting customer relationships is at its peak. Overlooking this opportunity lowers the likelihood of converting one-time buyers into loyal, repeat customers.
It doesn’t have to be this way. With the right approach, companies can identify audiences that closely resemble their ideal customers, making it easier to attract new ones. Building lookalike audiences can significantly improve your marketing efforts. By integrating these targeted acquisition techniques into your existing CRM strategies this holiday season, you can substantially broaden the reach and impact of your overall campaign.
Let’s explore how you can turn the holiday season into a time of profitable growth rather than just short-term gains.
The 2023 Holiday Season: Fears that Never Panned Out
The 2023 holiday season saw a significant shift in marketing strategies, with many of our brands opting to scale back their acquisition efforts. From 2022 to 2023, Postie’s clients reduced their prospecting (acquisition) campaigns by nearly 50% during the holiday season. The reasons for this pullback include:
- Decreased marketing budgets: Tighter financial constraints forced brands to cut back on spending for acquisition campaigns.
- Uncertain spending predictions: Fluctuations in consumer behavior made it challenging to accurately predict the success of holiday marketing efforts.
- Unpredictable economy: Economic volatility created a climate of caution, leading brands to be wary of making substantial investments in prospecting.
Together, these factors resulted in a more cautious and restrained approach to acquisition marketing. Despite these issues, Postie brands still achieved a +14.3% increase in revenue and +86.4% in conversions year-over-year. Not to mention, the Mean Average Order Value (AOV) was $301.68. The 2023 numbers indicate that demand remained strong, and those who invested in targeted direct mail likely captured a larger share of the market.
Turning Past Challenges into Future Wins
Our data from the 2023 holiday season reveals a significant missed opportunity for many brands that chose to scale back their acquisition marketing efforts. Despite all the feared warning signs, the results demonstrate that consumer spending was still robust, suggesting that more aggressive acquisition strategies could have yielded substantial benefits.
Brands that tapped into data-driven direct mail boosted their revenues and forged stronger connections with new customers. Precision targeting enabled these brands to cultivate meaningful relationships, enhancing customer engagement and loyalty.
At Postie, creating lookalike audiences of these brands’ most loyal customers turned out to be a key factor in extending their reach. The strategy connects brands with new customers who exhibit similar behaviors and preferences, thereby increasing the likelihood of conversion and retention.
Choose the Right Marketing Channel
Investing in customer acquisition offers substantial benefits to businesses, but the choice of marketing channel can significantly influence the scale of success. Direct mail is a highly effective strategy, as it enables companies to target specific demographics with personalized messages, effectively reducing their Customer Acquisition Costs (CAC). The potential payoff increases significantly when considering the Customer LTV contributed by new customers.
Strategic customer acquisition is the focused, data-driven approach of identifying and engaging new customers with the highest potential for long-term value. If you understand the characteristics, behaviors, purchase patterns, attitudes, and lifestyles of your ideal, high-LTV customers, you can strategically invest your acquisition budget to attract the most profitable individuals.
Strategic Customer Acquisition in Action
A prime example of strategic customer acquisition is the Buca di Beppo case study. Working with Postie, the restaurant successfully implemented a targeted direct mail campaign leveraging highly pinpointed, strategic audience building based on high LTV personas.
This coordinated effort resulted in the acquisition of 20,000 new customers and achieved a remarkable 307% return on ad spend (ROAS) with a relatively high 3% conversion rate. These efforts also enhanced the restaurant’s audience LTV through increased visit frequency and spending.
Balance Acquisition and CRM Marketing
During the holiday season, the right tools can dramatically transform your marketing outcomes. Companies that optimize acquisition and CRM marketing, while using Postie’s direct mail capabilities, can significantly boost their promotional effectiveness. The recommendations below can help your company achieve a successful holiday campaign.
Maximizing your impact during the holiday season requires a strategic balance between attracting new customers and nurturing your existing ones. The unique dynamics of the season demand a tailored approach that aligns with changing consumer behaviors. Here are three strategies to keep in mind:
- Employ integrated campaigns: Design campaigns that cater to both new and returning customers, using segmented messaging that resonates with each group’s specific holiday preferences. Postie’s lookalike audience tools enhance these campaigns by accurately targeting potential customers who resemble your current best customers.
- Use data-driven insights: Use Postie’s analytics to identify which channels and messages have been most effective for different segments during past holiday seasons. Precise data allows you to tailor your strategy to capitalize on those insights.
- Manage timing and frequency: Schedule your acquisition efforts to align with the distinct peak times of the holiday season. Ramp up your CRM activities during quieter periods to keep your brand top of mind. Manage the frequency of your communications to maintain engagement without overwhelming your audience during this busy season.
By integrating these strategies, your brand can effectively balance outreach and engagement, making the most of the opportunities presented by the competitive holiday season.
Budget Allocation Strategies During the Holiday Season
During the holiday season, especially in times of economic uncertainty, how you allocate your marketing budget can make or break your campaign’s success. The heightened competition and fluctuating consumer behavior require a strategic approach:
- Prioritize high ROI channels: Focus your budget on channels like direct mail, which has shown exceptional returns. Last holiday season, Postie’s direct mail campaigns achieved an average conversion rate of 5.73%, outperforming Google Ads. When integrated with CRM strategies, this rate soared to 9.03%, demonstrating the power of well-coordinated campaigns to drive both immediate sales and long-term engagement.
- Embrace flexibility: Maintain flexibility in your marketing budget to seize emerging opportunities or adjust your strategy based on real-time performance data. Direct mail facilitates this flexibility by enabling quick responses to changing consumer behaviors. A prime example might be initiating a campaign for customers who abandoned their shopping carts during Black Friday sales.
- Employ cost-effective creatives: The holiday season requires more marketing content. Invest in creative assets that are adaptable across various platforms and audiences, such as customizable direct mail templates that allow for quick and cost-effective adaptations. Employ broad testing and rapid optimization to keep your campaigns relevant and effective all season long.
By strategically allocating your budget across these high-impact channels and adapting swiftly to market dynamics, you can produce a robust return on investment.
How Acquisition Marketing with Postie Hits the Mark
Postie’s innovative acquisition marketing strategies are designed to expand your market reach, maximize spending potential, and capitalize on retargeting opportunities. Let’s explore how these targeted efforts can dramatically enhance your marketing outcomes during the holiday season and beyond.
Expand Market Reach
Postie’s lookalike audience tools excel at finding new customers that resemble your best customers. Using our Data Management Platform (DMP), we integrate your CRM to identify a seed audience of your best customers, characterized by high lifetime value and average order value. This seed audience helps us pinpoint the ideal qualities that comprise your top customers. During the holiday season, we can amplify this strategy to captivate new customers while they are in the festive spirit, potentially turning them into some of your most loyal patrons.
Maximize Spending Potential
During the holidays, we use trigger campaigns to enhance personalization by offering tailored promotions or exclusive deals based on individual customer data and their previous interactions. By adopting a more targeted approach, you can drive immediate holiday sales and strengthen long-term customer relationships, demonstrating that your brand truly understands and values customer preferences.
Find Retargeting Opportunities
The holiday season, with its surge in shopping activity, presents an ideal time to harness Postie’s retargeting capabilities. Google’s recent decision to delay the deprecation of third-party cookies provides Postie with additional tools to effectively track user behavior and optimize retargeting campaigns.
During the holidays, we actively employ strategies like abandoned cart recovery and targeting multi-page visitors to capture and convert more leads. This approach enables us to effectively reconnect you with visitors who have shown interest but haven’t yet purchased. Our focused strategy ramps up your chances of converting visitors into customers during this critical shopping period.
By combining precision targeting with comprehensive campaign management, we help you capitalize on every opportunity, ensuring a profitable and impactful holiday season. Request a demo to start planning your strategy with Postie and turn potential into performance.
