Customer acquisition is the process of finding and persuading prospective customers to buy from your business in a way that is both measurable and repeatable—not random.
Customer acquisition happens in stages, which are often visualized as a customer acquisition funnel:
Marketers and entrepreneurs often discuss the funnel in 3 main stages:
Top of the funnel (awareness): At this stage, your goal is to generate awareness and leads amongst your target audience. Typically, you'll focus on a large, broad audience that may be interested in your company's brand or products, but without a definite intent to buy. A baby brand may use the hashtag #nurserydesign to expose their posts and products to those looking to decorate their nursery on Instagram.
Middle of the funnel (consideration): Prospective customers that move from the top of the funnel to the middle have usually taken an action that shows that they are considering a purchase, such as signing up for an email list or following your brand on social media. It is now up to you to convince them to become customers.
- Bottom of the funnel (purchase): This is the final stage a prospect goes through before they convert into a customer. Usually, they have taken some action that indicates a strong intent to buy, whether it's adding a product to their cart or signing up for a free trial. Businesses will often send incentives, like a discount code, at this stage in order to convert prospects who are close to making the decision to buy.
There are many different ways a business can go about finding and converting these new customers, especially online. With digital marketing, it has become easier to track exactly how your business acquires new customers, discover and test new marketing tactics, and scale those that work.