By Novuna Acquiring new customers is a crucial part of any retail business strategy. Our latest study with retailers, conducted as part of Novuna Consumer Finance's market analysis, reveals that acquiring new customers is becoming increasingly costly. 69% of retailers reported rising customer acquisition costs (CAC), while a quarter admitted they dont fully understand their true CAC. These findings highlight the growing challenge of attracting new customers and the urgent need for cost-effective acquisition strategies. So, how can retailers attract new customers without overspending? Here are some proven strategies to reduce acquisition costs while maximising customer value.

Offer flexible finance options

One of the most effective ways to attract new customers is by offering accessible and flexible finance options. According to the Novuna report, customers increasingly prefer to spread the cost of big-ticket purchases over manageable monthly payments. Through optimising finance and being transparent with finance options available, retailers can make their products more appealing without resorting to heavy discounts

Focus on owned marketing channels

With 46% of retailers citing increased marketing costs as a top challenge, investing in owned marketing channels can be a smart move. Organic SEO, social media, email marketing, and content marketing allow businesses to drive traffic and engagement without the ongoing cost of paid advertising. Effective SEO strategies and high-quality content can attract potential customers searching for relevant information or products.

Personalisation drives conversions

Personalisation isnt just a buzzword - its a powerful tool for attracting new customers. The Novuna whitepaper highlights that companies excelling in personalised marketing generate 40% more revenue than those who dont. Leveraging customer data to provide targeted recommendations, personalised emails, and tailored promotions can significantly boost conversion rates. However, personalisation shouldnt stop at marketing - it can be embedded throughout the entire customer journey. Theres little value in offering the perfect product based on insightful data, only for the customer to face a rigid, impersonal finance rejection. Every interaction should reinforce that their needs are at the heart of your business.

Make the most of social proof

Trust is a critical factor in customer acquisition. Customer reviews, testimonials, and user-generated content serve as powerful social proof, making your brand more trustworthy to potential customers. Encouraging satisfied customers to share their experiences can significantly boost credibility and drive new business.

Optimise for omnichannel retailing

An omnichannel strategy is no longer optional. Customers expect a seamless experience whether they shop online, in-store, or through mobile apps. The Novuna report notes that omnichannel customers tend to spend more than single-channel shoppers, making this a cost-effective strategy for boosting acquisition.