How to Find Customer Acquisition Channels for Your Startup
Growth strategy begins with understanding where your brand has the best chance of reaching your potential customers at scale. This guide lays out what traffic sources you can choose from, and which particular channels are most likely to work for your business.
Traffic is the currency of the internet, and the lifeblood of any internet-based business.
You may have an interesting product and a compelling value proposition. Hell, your website might even win design awards. But if you're doing business on the internet, you're lost without a strong traffic acquisition strategy.
There are thousands of ways a brand can get traffic. How should a startup decide where to focus to get the best value traffic?
The answer: by focusing on channels that fit the character of their brand.
Before diving into what those channels are, we need to align on the three core types of traffic - inbound, outbound, and viral.
Inbound traffic comes from channels in which your customer initiates contact with your brand.
Outbound traffic comes from channels in which your brand initiates contact with your potential customers.
Viral traffic sources comes from channels in which your customers initiate contact with other potential customers.
Growing on the internet comes in two forms - acquiring traffic and optimizing for conversion. Acquiring traffic is the art of enticing internet users to visit your site, and conversion optimization is the art of convincing them to sign up or buy something from you while they're visiting. Conversion optimization is half the equation, but this guide will focus on helping you figure out how to bring your startup sustainable traffic.
We'll outline the core acquisition channels that fit into these three categories, how to choose which channels your business should focus on, and examples of companies leveraging channels from each traffic type.
Acquiring Traffic for your Startup
First off, the categories in this guide may overlap. Most acquisition channels combine inbound, outbound, and virality in varying degrees. This guide assigns channels as inbound, outbound, or viral based on where the primary leverage is for a startup looking to grow.
Notice email isn't here? This was deliberate - email is more about activating users than acquiring them. This guide will focus mostly on getting net new users to your website.
Let's dive in.
What is inbound traffic?
Inbound traffic is traffic initiated by the customer, meaning the customer takes the first step in your relationship.
This doesn't mean your brand is idle, though - your brand must work to be present when the customer makes their first move.
Which acquisition channels are inbound?
SEO Web Content
93% of all internet traffic starts with a search. Clicking a search result on Google usually lands you in a brand's marketing funnel built on SEO web content. SEO usually refers to written or video content optimized to appear in web searches for keywords that are important to your brand.
There are two key factors for being successful here- technical and content.
Technical SEO is concerned with helping Google and others find your website and index your content, so it can display it to people searching for specific keywords. Keyword research, increasing domain authority through backlinks, site speed optimization, and on-page keyword optimization all fall under this umbrella.
Content SEO is a more qualitative. A huge factor in ranking highly is "finality", which measures how many searchers "finished" their search when they hit your site. High finality signals that your page is high quality, which shoots it up the rankings, leading to more traffic. High quality content is also shared much more broadly than lower quality content, so writing quality content about the right things are paramount.
SEO is typically a long term play. When done well, results can be tremendous, but the upfront investment is considerable and results often take at least six months to materialize. Weigh the trade-offs carefully.
Above organic search results sit search ads. In essence, you can pay a search engine like Google to give your brand advertising space preceding the top ranking search results for whatever keywords you think a potential customer might search for.
Search ads can be one of the best channel investments. Once you make it work for your business, you can let it cruise with less maintenance than some other channels. Search ads are very similar to SEO as a channel, except you pay upfront for quick results rather than waiting for your SEO efforts to pay off in the future. They're often used in conjunction - some companies find highly profitable keywords through search ads, and then build SEO content to rank organically for those searches in the future.
Which companies should focus on inbound acquisition channels?
Inbound channels often suit organizations who have more time than money, although there are some obvious exceptions.
What you offer is already in demand
The most obvious advantage of inbound channels is that you don't have to create demand - you can just tap into demand that already exists. If people are already searching for your product, your main task is to leverage inbound channels to get in front of your market, and differentiate yourself from the competition.
You're local - and so are your customers
Search engine competition is much lower for local keywords for both SEO and paid search. Creating content and running ads better than your competitor down the street is easier than outdoing world class marketers. You don't have to be great - good will be good enough.
Don't forget about Google My Business and other local search tools. Focusing here will help you get ranked highly on the map view of your city, which appears before most search and ad results.
You have limited resources.
Writing search-optimized content is close to free if you do it yourself, and search ads can be scaled up slowly and deliberately to reduce wasted spending. When done right, inbound channels will payback with interest for a long time, and are a great choice for resource constrained brands.
Brands using inbound acquisition channels
Ahrefs builds SEO toolkit software. So, as the masters of their own game, they naturally doubled down on SEO.
SEO is a complicated topic with a ton of search volume, so they decided to build a content library that focuses on creating real value for their visitors, while capturing a percentage of them to pay for access to their toolkit. They now rank near the top of Google Search for dozens of SEO related keywords.
Wix is a no-code website building platform that focuses on the non-technical market. To compete with rival Squarespace who was famously going outbound and sponsoring almost every podcast imaginable, Wix decided to focus on inbound and bid on keywords that indicate customers are a) wanting to build a website and b) non-technical.
The result is Wix dominates Google's ad spots for terms like "no code website" and "website builder".
What is outbound traffic?
Outbound traffic is traffic initiated by a brand. In practice, this includes all channels in which the company is attempting to 'disrupt' a member of their target market with sales messaging in hopes that they'll convince some of them to visit their website.
Which acquisition channels are outbound?
Chances are you've been hit with thousands of ads on social media sites. Social ads are distinctive from search ads because they're 'profile' based rather than 'intent' based. This means they're displayed based on what a network thinks it knows about a particular user's likes and tendencies, rather than on what they've explicitly searched for.
Unless you have a compelling reason to think otherwise, focus on Facebook and Instagram first if you're B2C, and LinkedIn if you're B2B. Start targeting broadly, and peel off more specific segments to try to defeat your broad targeting in cost per acquisition over time. Invest in quality creative, and never spend a dollar that's not also doing double duty helping to test audience, creative, placements, or landing pages.
Traditional Media Ads
Newspapers, billboards, flyers, radio - there are countless legacy ad formats that fit into this category. Typically, these were used before we had data to be able to understand the effect produced by advertising. They've since added features to help advertisers track ROI (unique phone numbers, data on billboard passers-by) but for the most part, they're only valuable to local businesses or mass-market brands.
Influencer Marketing and Sponsorships
The internet enables niche communities like few tools before it, and this provides an interesting opportunity for marketers looking to reach an audience. To take advantage, find an internet personality or interest group with an audience that correlates with your target market, and pay them to promote your brand to their audience. This is often done via newsletter, podcast, or social post.
This channel is useful because it allows you to tap into an existing audience rather than create your own, but doesn't give you much control as you rely on non-owned audiences to promote your offering.
Cold Outreach & Sales
Making connections and starting conversations with potential leads is one of the oldest (and in certain circumstances, most effective) tricks in the book. Start by gathering email lists of potential buyers of your offering, crafting thoughtful email sequences designed to get them to take a specific action, and automating the process so you can do it at scale.
What companies should focus on outbound acquisition channels?
Outbound channels are typically resource intensive, so should be handled carefully if you're working in a bootstrapped environment.
You have investor money and pressure.
Outbound channels don't just tap into latent demand - they help create net new demand. If you have pressure to grow and the resources to invest, outbound channels offer scalability and reach unimaginable short of a viral hit. And unlike virality, you'll be able to target your message to a particular group of people relevant to your brand.
You're doing something new.
If your potential customers need what you have but aren't looking for you, you'll have to "interrupt" your way in front of them. Here, outbound channels shine. Leverage the ability to target exactly the kind of person who could use what you have, and hit them through the most effective channel you can find.
You know exactly who you want to sell to.
Whether it's ads, outreach, or partners, outbound offers superb options to reach your target customer. Targeting based on job function is easy for B2B, and interest or purchase history targeting is easy in B2C.
Your funnel is short.
Many companies have long sales funnels, which makes it difficult to properly attribute customers to particular growth channels. But if you can turn clicks into revenue very quickly, it will be much easier to track a particular channel's profitability. Once profitable, you can continue to run campaigns based on ROAS (return on ad spend) or calculating contract value to your sales process investment. E-commerce and service businesses often fall into this category.
You have high customer LTV.
If your customers pay you lots of money, it's a lot easier to justify cash investment into channels that prove they can bring more customers to you. Whoever can pay more to acquire a customer will win, so lean into your high LTV to outlast the competition.
Brands using outbound acquisition channels
Remote Year was one of the first remote work and travel programs out there. With their new take on travel, they had little inbound opportunities, and instead turned toward social ads as a way to build awareness and drive signups.
Their product had a high LTV and was very sexy, but only certain people could make it work with their work situations. To make it work, they cast a very wide top of funnel, distributing content focused on the novelty of the product to drive top of funnel signups that were then vetted by their sales team. (I worked on this project - you can read more about how we did it here)
Productivity software is a crowded marketplace, so early adopters were blown away when Roam arrived on the scene flanked by what felt like hundreds of micro-influencers touting it's "networked thought" features as a paradigm shift in personal productivity.
On closer inspection, it's clear Roam Research realized it couldn't compete with traditional ad channels dominated by Monday and Asana which could afford the ad space with their large corporate clients. Instead, they focused on the underserved personal productivity community and sponsored them to produce content on them. The result was a flood of influencer buzz, which spun off into viral Pr and social media loops.
What is viral traffic?
Anyone lucky enough to have been on the receiving end of a viral hit knows there's nothing closer to magic in the world of growth marketing. Viral traffic is traffic initiated by existing customers or followers. In practice, this includes all channels in which the primary leverage comes from actions customers take that amplifies the message a company wants to project into the world.
Sometimes this can happen organically, but it's most often engineered by crafting content that's made to be shared widely.
Which acquisition channels are viral?
Organic social media
Tweet, post, share - if your content speaks to people, you might find it getting disproportionate amounts of shares and traffic. Organic social media covers any content posted on owned social media channels without paid media spend to help it reach people.
Organic social is often paired with Content and SEO (companies produce SEO content and then share on their social media channels) and paid social ads (organic posts boosted with advertising dollars), but organic social's mechanism is unique. Its power comes from persuading social followers to feed positive signal (likes, shares, saves) around a specific piece of content into the a social network's algorithm. When done right, this can lead to an exponential boost in eyes on your content and brand.
PR has come close to merging with Organic Social Media and Content and SEO, but for one important difference - the content comes from an external source rather than an owned channel like your own social media. These sources include traditional PR like getting featured in news and magazine press, as well as new media moves like guest blogging and appearing on podcasts.
PR as a strategy is a double-edged sword - on one hand, a brand can leverage the outlet's following to get in front of a new audience and develop important backlinks to their site to help with SEO. On the other hand, you're constantly chasing coverage and have little control over whether you get enough coverage to justify your investment.
Who better to tell people about your brand than your customers? Referral traffic turns happy customers into ambassadors that work to sell your brand to the people. Referral traffic can come from a few different sources. Many brands set up specific referral programs that incentivize customers to refer traffic that converts in exchange for credit or rewards. Software companies can also lean into referral traffic by focusing on product-led growth, which prompts users to improve their product experience by inviting their friends to join them.
What companies should focus on viral acquisition channels?
Viral channels are risky and inconsistent, but they can really make a difference if one hits right. These channels are often best used in conjunction with other channels, not as a strategy unto themselves.
Your product or market is inherently captivating, timely, controversial, or funny.
It's a lot easier to get people to talk about you when opportunities come to you. If your product or market has buzz built in, there's a good chance you'll find traction here. Developing a controversial perspective can help multiply the effect.
Your team has high level competency in video or a background in journalism.
If you have an unfair advantage, exploit it. Leverage the media backgrounds on your team to game the system of virality, both in press and social media.
Your market is heavily concentrated in highly engaged communities.
If your market is has already organized itself into easy to find communities, then half your work is done for you! Make it your job to add value to that community, and they will pay you back handsomely with feedback, goodwill, and eventually, revenue.
Your brand is a person with an interesting perspective.
People want to listen to what interesting people have to say. As a personal brand, you'll find a receptive audience. Plus, you won't have to work to rise above the cloud of distrust most brands get lost in when they publish content online.\
Your product is improved with additional users
It's much easier to convince a customer to share your product with friends if their experience will improve once they do. This works especially well for B2B software and B2C social networking apps.
Brands using viral acquisition channels
After initial influencer buzz, Clubhouse leveraged scarcity and referral by offering early user with invites they could give to people they knew. For the inviters, they got to customize their experience by bringing in people they like. For invitees, they got to feel special as they were selected to join an exclusive club. The result was the biggest consumer app launch in years.
Founders Jason Fried and David Heinemeier Hansson built their project management software Basecamp into a long term bootstrapped success story mostly by being outspoken about workaholism in tech on Twitter. Their success led to book deals and general internet fame, but also helped build strong brand and awareness for their software.
Their self-made positioning as contrarians to Silicon Valley VC craziness also helped them draw in a quieter but nonetheless sizeable market of bootstrappers into their software's marketing funnel.
Dollar Shave Club
The perennial example of a viral video kicking off a unicorn startup, eventually leading to a billion dollar exit four years later to their biggest competitor.
Now that you know how to acquire traffic for your startup, you'll have to learn how to convert them into users and revenue - but that's for another day. Go forth and get that traffic!