6 Ways To Decrease CAC And Increase Sales (+ Actionable Tips)

Budgets are ever so tightening (if they haven't already).

The rising interest rates and subsequently the mortgage payments and rent has upended the savings of everyday Aussies. Furthermore, Australia's next-door neighbor is in recession already, with NZ seeing a 0.1% decline in GDP already, and Australia almost teetering on the edge.

Consumers are starting to pare back their spending drastically. As a result, growth is difficult to come by as we experience the onset of the "retail recession".

Which levers would you pull to drive down your CAC (Customer Acquisition Cost) and increase your sales?

1. Budget allocation and pacing

- As Google and Meta and other ad platforms democratise AI by compelling brands to adopt them en masse, the last remaining advantage is starting to wither away, especially for incumbents. This leaves advertisers with very few areas of distinction and leverage, one of them being Budgeting.
- They say, sometimes "It's the boring stuff that gets you the results". That's definitely the case when it comes to the big B!
- Google and Meta have most things figured out except budgeting e.g. if an ad converts first, the platforms continue to serve the ad over others even if other ads are likely to perform better over the long run.

Tip: Forecast your budget wisely, use internal data and external trends to guide your forecast. This has a multiplier effect on revenue i.e. if you take more shots when there are more opportunities, you end up getting more goals naturally (and vice versa).

Tip: Review your pacing and ROAS across campaigns regularly and move the budget to campaigns with a higher ROAS and some more headroom to spend. This keep profitability high and also keep the board happy :)

2. Creative

- Creative has a 50-70% impact on marketing results, more so than any other variable like media planning or buying.
- Even this advantage is being slowly chipped away at through excessive ad regulation (read: cookie-cutter Shopping Ads), the advent of responsive ads (AI creating ads out of multiple advertiser-supplied assets) and the forthcoming Search Generative Experience ads (Google creating ads automatically out of thin air, oh sorry, using your website)

Tip: Use your images and text to stand out rather than blend in. Differentiate your brand from the competitors in your industry every which way. This will drive much more clicks at a much lower cost, driving down your CAC substantially.

Tip: Pin your assets to exert more control over how your ad reads and looks and make it more impactful. This will prevent AI from crafting an illegible ad and throwing money down the drain.

3. First-party data

- Import your customer segments and audiences from CRM into Google Ads and Meta Ads to serve up ads to your customers/subscribers based on where they are in the customer journey. Remember to personalise the ads for cart-abandoners, customers with their wallets nearly out.
Tip: If these customers research online and predominantly shop offline, leverage Local Inventory Ads (LIAs) to make the CX smoother.

- Set up Meta Conversions API (online) to dramatically improve the quality of conversion data collected (by storing it in your own server), better attribute the sales, and make every dollar count. Take it a step further via Offline CAPI by importing sales into Meta to attribute offline sales to Meta Ads

- Set up Enhanced Conversions in Google Ads and Server-side side Google Tag Manager (SSGTM) to improve the conversion attribution, and where data can't be collected, use Google's cornucopia of user data to attribute conversions.

4. Reduce budget wastage

- Not many know this, but Google's Performance Max campaign also has a placement report just like the Display campaign. Analyse the placement report every fortnight and add spammy-looking websites/apps to the account-level negative placement list.
Tip: If you find a .ru website, then it is most likely a bot-run website that deserves to be binned.

5. Create E-E-A-T (Experience-Expertise-Authoritative-Trust) content targeting all funnel layers

Tip: Use ChatGPT-4 via ChatGPT Plus (paid) to create up-to-date foundational pieces of a long-form article. Then use your own experience and expertise in your domain with a Skyscraper strategy to add a lot more value to your audience and give the article your personal touch. Finally, don't forget to interlink the article on the website and get some mean backlinks to it through outreach to race ahead of your competitor's rankings and traffic.


6. CRO and Site Speed

Tip: Start from the last step in your customer's conversion journey on your website and see what you can improve conversion-wise, then work your way up. Use A/B testing and heatmapping tools to continue with what works, and discard things that don't. Use the Eisenhower matrix to prioritise the tests.

Tip: Run a Google page-speed test every month to analyse how fast/slow is your website. Action the recommendation that will have the highest impact on your website speed, trust me, it will give your business a much-needed sales boost, especially if your website is slightly on the slower side. Mobile users are impatient, so give the mobile site more love if it gets substantial traffic.