This is a presentation I made to startups at the Front Row I/O accelerator on April 15th regarding customer acquisition strategies for startups.

1. Customer Acquisition Strategies
Front Row I/O
April 2014
Kiyan Foroughi – CEO & Co-Founder

2. AGENDA
• Boticca Overview
• A Few Basics
• Paid Channels
– Search Engine Marketing (SEM)
– Affiliate Marketing
– Lead Acquisition & Email Marketing
– Retargeting
– Social
• “Free” Channels
– Search Engine Optimization (SEO) & Content Marketing
– PR & Bloggers
• Other Things to Consider & Some More Tips
We won’t cover TV, Media and print/outdoor advertising as this primer is mostly for start-ups with more modest budgets.
#Boticca 2

3. BOTICCA OVERVIEW
Boticca is the world’s luxury bazaar of
fashion accessories
370+ brands in 40+ countries and 11,000+
pieces available
Pieces shipped to 60+ countries each
month
700,000+ members with an average order
value of US$185
Staff of 20 based in London
Backed by MMC Ventures, ISAI, Digital
Garage and angel investors
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4. A FEW BASICS
Most online businesses live and die by their online customer acquisition strategies
You’ll need a formulaic, scalable acquisition strategy to be successful
Each business is different and so will your online acquisition mix
In the end, everything is governed by one relationship:
Cost Per Acquisition (CPA) versus Customer Lifetime Value (CLTV)
And the equation needs to look like this for a real, sustainable business:
CPA < CLTV
Your customer acquisition strategy/mix will also depend on your unit economics such as
Average Order Value (AOV) and margins
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5. PAID CHANNELS: SEARCH ENGINE MARKETING (SEM)
What is it?
– Google Adwords
– Display Advertising
– Video/Youtube Ads
What you need to measure
– CPCs, CTRs, Impressions, CPLs
Pros
– It’s immediate!
– Fastest way to scale
– Very measureable
Cons
– Dependency on Google
– Can become very expensive
– Large budgets required
Who does it work for
– Businesses who sell brand name or
commoditised products
– Businesses with high AOVs and margins
Mistakes we made:
– Burned through lots of budget before
realizing it wasn’t for us
– Too much Adwords optimization, not
enough onsite
TEST BUDGET: > £10,000 Per Month
#Boticca 5

6. PAID CHANNELS: AFFILIATE MARKETING
What is it?
– Performance-based marketing that
rewards partner sites (affiliates) for
referring traffic and customers
What you need to measure
– CPCs, CTRs, Impressions, CPLs
Pros
– CPA-effective
– Very measureable
Cons
– Affiliate recruitment time/resource
intensive
– Takes a while to scale
– Limits to how much it can be scaled
– Technical integration
Who does it work for
– Businesses who can offer some margin
to partners
Mistakes we made:
– Underestimated how time consuming this
channel can be
– Didn’t put enough budget aside to book and
schedule tenancies to push top affiliates
TEST BUDGET: > £3,000 Per Month
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7. PAID CHANNELS: LEAD & EMAIL MARKETING
What is it?
– Acquisition of leads (subscribers/emails)
and activation via regular email
marketing
What you need to measure
– CPLs, Activation Rates
Pros
– Ability to segment and send personalized
messages directly
– Ability to retain customers
– Ability to A/B test
Cons
– Results are not immediate
– Deliverability and renderability are key to
success
Who does it work for
– Most online businesses that offer
constantly new products or services (not
so effective with content-led businesses)
Mistakes we made:
– Drew conclusions from database sizes that
were too small (less than 50,000)
– Got some emails from competitions (lower
quality)
TEST BUDGET: > £5,000 Per Month
(£1-3 per email)
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8. PAID CHANNELS: RETARGETING
What is it?
– Targeting users off-site when prior visits
didn’t result in a conversion to bring them
back on-site
What you need to measure
– CPCs, CTRs
Pros
– When optimised, is usually quite a CPA-
effective channel
– Can be personalised (should be)
Cons
– Need traffic volume
– Technical integration
– When done poorly, it can look like
stalking
Who does it work for
– Most online businesses that where the
ultimate call to action is a sale or
conversion
Mistake we made:
– Used bigger retargeting specialists like
Criteo who offer no customization of
banners (looked ugly)
TEST BUDGET: > £2,000 Per Month
#Boticca 8

9. PAID CHANNELS: SOCIAL (FOR START-UPS, IT’S NOT FREE)
What is it?
– Advertising and performance-based
marketing on social media platforms such
as Facebook, Twitter etc.
What you need to measure
– Member base and referral traffic
– CPLs, CTRs
Pros
– Deep segmentation capabilities
– Direct engagement with your users
– SEO benefits as social signals are factored
into Google’s algorithms
Cons
– Generally an expensive and low conversion
channel with poor ROI channel
Who does it work for
– Content-heavy websites
– Nobody in ecommerce for driving sales on a
CPA-basis (as far as I know!)
Mistakes we made:
– Thought we could use social media to drive
sales!
– Spent time on networks which were popular
but didn’t have our customer demographics
TEST BUDGET: > £1,000 Per Month
#Boticca 9

10. “FREE” CHANNELS: SEO & CONTENT MARKETING
What is it?
– Raising the visibility of your website to
appear in natural search rankings of
Google… I mean, search engines
What you need to measure
– Natural search traffic and conversion
– Individual keyword rankings
– Site performance/speed
– Domain authority and backlinks quality
Pros
– Quality, targeted traffic
– Content marketing can also help
PR/branding
Cons
– To be done well, requires technical resource
– Time-consuming
– Good content marketing campaigns are hit
or miss
– At the mercy of Google and their constantly
changing algorithms
Who does it work for
– Pretty much everybody
Mistakes we made:
– Didn’t think it would take that long to scale
– Didn’t put enough tech resource behind it
– Releasing too many SEO-focused tech
changes at a time
#Boticca 10

11. “FREE” CHANNELS: PR & BLOGGERS
What is it?
– Spreading the word about your business via
articles in the press (online/print) and via
bloggers
What you need to measure
– Publications and bloggers that work/don’t
work
– Time/effort vs. returns
Pros
– Elevates brand and trust which in turn has a
positive effect on the conversion rate of
other channels
– High ROI
Cons
– Not easily replicable (PR)
– Hard to measure ROI (PR)
Who does it work for
– Pretty much everybody but you constantly
need to have a story/hook with new
information (with press)
Mistakes we made:
– Focused too much on business press as
opposed to consumer press early on
– Overestimated how much you can scale
blogger marketing
TEST BUDGET: >£1,000 (for bloggers)
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12. OTHER THINGS TO CONSIDER & SOME MORE TIPS
Don’t be afraid to test several channels and figure out what works for you
Don’t rely on one channel: have a mix
Data, data, data: Let the numbers be your guide
Depending on the channel mix, a good monthly test budget would be > £15,000-£20,000
Don’t forget to focus on the other fundamentals such as a strong, well-defined brand and a
flawless customer experience
And never forget: CPA < CLTV
#Boticca 12

13. Any questions?
kiyan@boticca.com
Thank you!