Earlier this month Piper Jaffray & Co released a study of 5 marketing channels concluding that consumers, rather than going to online stores, are increasingly likely to use Online Search to find products and services.Further, Search is by far the most efficient at acquiring customers.
With an average cost per acquisition of $8.50 across all sectors, Internet search is more than twice as efficient as the all other options. The study, â€œThe New eCommerce Decade: The Age of Micro Targeting,â€ compared customer acquisition costs of search, e-mail and direct mail, Yellow Pages, and online display ads.
Yellow Pages came in as the second-most efficient at $20 per customer acquisition, followed by online display ads at $50 (another important finding for online marketing!), e-mail at $60, and direct mail delivering to $70 per customer.
Consider these findings for a moment and we can logically conclude that they aren’t all that surprising. Yellow Pages and search are primarily pull based marketing opportunities with which customers are actively seeking your product or service; Yellow Pages results in a higher CPA given their advertising based model in which advertisers still have to pay for placement, albiet highly targeted placement.
Email and direct mail are surprising for, though they are targeted messages in some cases at the request of the audience, online display ads remain bogged down by unclear expectations and competiting (brand vs. demand gen) initiatives through which one would expect higher relative media costs. All the same, Good news for us!