Reducing your customer acquisition cost (CAC) is essential to the success of any business. A high CAC can put a strain on your marketing budget, making it difficult to acquire new customers and grow your business. In this blog post, we will discuss how we were able to slash Postmates' CAC by 82.5% on a $1.3M spend, resulting in 398k conversions. We'll also share our approach, solution, and case study results, as well as tips on how to growth hack your customer acquisition.
Postmates, a popular on-demand delivery app, needed to acquire new customers at a $40 CAC to hit their next milestone and continue to raise capital. Our challenge was to reduce their CAC while also increasing conversions.
To reduce Postmates' CAC, we decided to pivot from their existing strategy of targeting people searching for "meal delivery apps" and instead target "menus." We remembered the massive amount of search volume in "menu" keywords and realized that hungry people searching for "Leonardo's Pizza Menu" in Gainesville, FL in 2008 were wishing there was an app like Postmates. Therefore, we built an entire menu operation into the Postmates app, mapping every single item from every single restaurant and building landing pages. Then, we drove users to those landing pages based on keywords like "Joe's Pizza menu."
By being creative and pivoting our strategy, we were able to deliver an 82.5% reduction in Postmates' budgeted CAC, delivering a $7 CAC over a 1.5 year period. We also attained the lowest CAC in the entirety of their account spend.
Here are the metrics from our Postmates campaign:
To optimize your customer acquisition and reduce your CAC, consider the following tips:
Reducing your CAC is crucial to the success of your business. By being creative and pivoting your strategy, you can achieve significant cost savings while also increasing conversions. Use the tips and case study results discussed in this blog post to help you growth hack your customer acquisition and take your business to the next level.