Friday, March 23, 2012

Learn Quickly the Cost of Acquiring a Customer

One of the most common advice I give to aspiring entrepreneurs about their business plans is to Learn as fast as possible the true cost of acquiring a customer.  Why?  It tells you quickly how viable your business is AND helps you to focus your message.

One of the easiest ways to do this is to run a test ad campaign with several simple landing pages.  Can you convince some (hopefully targeted) web traffic to convert into interest? Can you convince them to become a buyer?  How much did it cost to get 10 customers?  (divide that cost by 10 and you have a rough idea how much it will cost to acquire customers in the future).  Too high?  Consider A/B Testing new landing pages, or being more targeted... or maybe even improving the offering (the product).

Get Busy!  Test. This book (which I thought was quite good, especially for engineer-type thinkers) may help:

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