January 16, 2022

The Real Problem

Here's our business, floundering around, barely staying afloat.

The one thing a marketer actually controls is customer acquisition spend / customer acquisition programs. Yeah, I know, your CFO won't let you spend money, but you don't have to spend money to acquire customers. There are countless low-cost / no-cost programs, and the smartest companies run them routinely, constantly outrunning those who spend a fortune.

To get the business to $29.9 million in five years, we'll need a whopping 75% increase in new customers and we'll need to hold steady at that level for five full years.

We now have three scenarios to consider.

  1. Loyalty programs, which did nothing to solve the problem.
  2. Improve retention among existing buyers by 15%.
  3. Increase customer acquisition by 75%.

Almost every marketer you know would pick (2) ... a solution that is nearly impossible to achieve.

Smarter marketers would pick (3) ... a solution that is likely too expensive to implement.

But that's our job. We have to show tradeoffs.

The real problem with this business is customer acquisition. You hate hearing that. But that's the core problem. That's the problem we need to solve. We're not going to be able to sustain increases in rebuy rates of 15% every year for the next five years ... it's just not going to happen. Go look at your own metrics for proof.

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