Traffic Acquisition and The Comparative Cost of Customer Acquisition

Traffic acquisition is only part of the equation; another important part is customer acquisition. It's all very well to have the traffic, but how much of it actually converts into customers? If you can't answer that question, then you're in even more trouble!

Let's start at the beginning.

Traffic acquisition in web site terms is the act of getting eyeballs to a specific web property (page, video, blog post, etc.) It can be achieved through PPC campaigns, paid search placement, SEO techniques, social marketing, and so on - all of which have a cost.

Knowing that cost (essentially the price paid divided by the number of visits) enables you to work out the TAC. But there's also been a lot of talk recently of something else - the CAC, or Customer Acquisition Cost.

That's the cost of acquiring a single customer, on average, and needs to compare favorably with the average lifetime value of your customer base, if you are to remain solvent.

If your CAC exceeds the revenue generated by the customer base, you will begin to lose money. Typically, your CAC is equal to the TAC plus the cost of any additional resources that have been used to convert the visitor into a customer.

This is usually where the trouble starts. How do you know what your conversion rate is? How do you increase your conversion rate? How do you get inside your visitors mindset to work out why they do or don't choose to buy from you?

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All of these topics (and more) are covered in the Traffic Acquisition Insider newsletter, where we expand on the topics talked about on the blog, and give you real advice and step-by-step guides that you can use today to boost traffic, conversions, and expand your bottom line!