Acquisition Strategy and Channel Optimization

Introduction

Growth is not created simply by increasing promotional activity. It is created when an organisation can repeatedly identify suitable prospects, reach them through efficient channels, convert them into customers, and retain enough of the resulting value to finance further growth. Acquisition strategy therefore concerns both marketing creativity and economic discipline.

For an entrepreneurial venture, channel decisions are especially consequential. A start-up normally has limited capital, incomplete information, a small brand, and little tolerance for inefficient experimentation. The central managerial question is not “Which channel is best?” but rather: Which combination of channels can acquire the right customers at an acceptable cost, with sufficient quality and capacity to scale?

This chapter examines paid, owned, earned, outbound, partnership, community, search-engine optimisation (SEO), and content channels. It develops a framework for comparing channels, estimating unit economics, designing experiments, allocating resources, and managing the risks associated with acquisition at scale.

Learning Objectives

By the end of this chapter, a learner should be able to:

1. Distinguish major acquisition-channel categories and explain their strengths and limitations.
2. Match channels to customer segments, buying situations, and stages of the funnel.
3. Calculate and interpret key acquisition metrics, including conversion rate, cost per acquisition, customer acquisition cost, customer lifetime value, payback period, and return on advertising spend.
4. Design controlled channel experiments and evaluate incrementality rather than relying only on attributed conversions.
5. Build a balanced marketing mix that combines short-term demand capture with long-term demand creation.
6. Identify ethical, regulatory, operational, and strategic risks in channel scaling.

1. Acquisition as a System

An acquisition system has five connected elements:

• Audience: people or organisations with a relevant problem, need, or propensity to buy.
• Value proposition: the reason the offer is relevant and preferable.
• Channel: the mechanism through which the venture reaches and influences the audience.
• Conversion system: the landing page, sales process, product experience, or other mechanism that turns interest into action.
• Measurement and learning: the data and experiments used to improve decisions.

A channel should not be assessed in isolation. A high click-through rate may be worthless if visitors do not activate or retain. Conversely, a channel with low immediate conversion may create valuable brand awareness, referrals, or future demand.

A useful funnel is:

Reach → Attention → Consideration → Conversion → Activation → Retention → Referral

The funnel is not strictly linear. Buyers may enter through a recommendation, research independently, interact with several channels, and purchase only after a later trigger. Consequently, channel analysis should combine funnel metrics with customer-journey evidence.

Channel-market fit

Channel-market fit exists when a channel can reliably reach a meaningful segment with a message and buying process that fit the segment’s behaviour. It depends on:

• where the target customer spends time;
• whether the customer is actively searching or must be educated;
• purchase frequency and customer value;
• level of trust required;
• sales-cycle length;
• geographic and regulatory constraints; and
• the venture’s ability to operate the channel.

A channel can be attractive in theory but unsuitable in practice. For example, search advertising may work well for a customer who already knows the problem and searches for solutions, but poorly for an innovative product category whose language customers do not yet understand.

2. A Taxonomy of Acquisition Channels

Paid channels

Paid channels require direct expenditure for distribution or access. Examples include search advertising, social advertising, display advertising, sponsored newsletters, influencer placements, affiliate commissions, events, and paid lead-generation platforms.

Their principal advantages are speed, targeting, controllable volume, and relatively rapid feedback. Their limitations include rising auction prices, creative fatigue, fraud, platform dependence, and the danger of optimising for inexpensive but low-quality conversions.

Paid channels are most useful when:

• the venture has a validated offer;
• conversion and retention are measurable;
• sufficient gross margin exists to fund acquisition; and
• targeting data are reliable and lawfully obtained.

Owned channels

Owned channels are assets controlled by the venture, such as its website, application, email list, customer database, product notifications, blog, documentation, and customer education centre. The organisation does not own every underlying technology, but it controls much of the content, audience relationship, and experience.

Owned channels typically have low marginal distribution cost and accumulate value over time. Their disadvantages are the time required to build an audience, the need for continuous content and lifecycle management, and the possibility that an owned audience is still dependent on an external email or hosting provider.

Earned channels

Earned channels arise when other parties voluntarily discuss, recommend, review, cite, share, or report on the venture. They include word-of-mouth, public relations, organic social distribution, independent reviews, backlinks, and customer referrals.

Earned acquisition can produce high trust and low direct cost, but it is less predictable and less controllable than paid distribution. Attempts to manufacture apparently independent endorsement can damage credibility and may breach advertising or consumer-protection rules.

Outbound channels

Outbound channels initiate contact with a prospect. They include sales calls, personalised email, direct messages, account-based marketing, field sales, and direct mail. Outbound is particularly relevant in business-to-business markets, high-value purchases, and situations where the total addressable audience is identifiable.

Its strengths are precise account selection, message control, and the ability to address complex needs. Its costs include labour, training, list quality, deliverability problems, reputational risk, and compliance obligations. Effective outbound is relevant and permission-sensitive, not merely high-volume.

Partnership channels

Partnerships use another organisation’s distribution, credibility, product, or customer base. Forms include resellers, referral agreements, integrations, co-marketing, marketplaces, embedded distribution, channel sales, and strategic alliances.

Partnerships can reduce trust barriers and accelerate access to concentrated audiences. However, they introduce coordination costs, revenue-sharing requirements, dependency risks, and potential channel conflict. A partner’s poor service or unethical conduct may also damage the venture’s reputation.

Community channels

Community channels rely on participation and relationships rather than one-way promotion. Examples include professional groups, user communities, founder networks, forums, events, ambassador programmes, and peer-learning spaces.

Communities can generate insight, trust, retention, referrals, and product advocacy. They are slow to build and difficult to manage if the organisation treats members merely as an advertising audience. A healthy community requires norms, moderation, reciprocity, and a clear member benefit.

SEO and content channels

SEO improves the discoverability of relevant pages in unpaid search results. Content includes educational articles, comparisons, videos, podcasts, research reports, tools, webinars, case studies, and product documentation. SEO and content are related but not identical: content may create demand without generating search traffic, while technical SEO may improve visibility for existing demand.

These channels can compound because useful content attracts links, rankings, subscribers, and repeat visitors. They usually require time before producing substantial results, and rankings are not guaranteed. Content should be designed around customer problems and search intent rather than keyword volume alone.

3. Matching Channels to Customer and Buying Context

A channel portfolio should reflect the customer’s decision process. A practical segmentation is:

The venture should also distinguish demand capture from demand creation. Demand-capture channels reach people already seeking a solution. Demand-creation channels influence future preference among people who may not yet be searching. An overreliance on demand capture can produce apparent efficiency until available search volume is exhausted or competitors bid prices upward.

4. Channel Economics

Core conversion metrics

If N₀ people enter a stage and N₁ complete the next stage, the stage conversion rate is:

The formula assumes that the numerator is a subset of the denominator and that both are measured over the same period and population definition. It is meaningful only when events are defined consistently; for example, “lead” should not change from one campaign to another.

Common measures include:

• Click-through rate (CTR): clicks divided by impressions.
• Cost per click (CPC): spend divided by clicks.
• Cost per lead (CPL): spend divided by qualified or unqualified leads, provided the definition is stated.
• Cost per acquisition (CPA): spend divided by specified acquisitions, such as completed purchases.
• Customer acquisition cost (CAC): acquisition-related cost divided by newly acquired customers.

A narrow campaign CPA may include only advertising spend, whereas fully loaded CAC may include creative, software, agency, sales, onboarding, and allocated personnel costs. Managers must state which definition is being used.

Revenue, margin, and customer lifetime value

Revenue is not the same as economic value. A customer who generates substantial sales may still be unprofitable after fulfilment, support, payment processing, refunds, incentives, and variable service costs.

For a simple subscription business with stable monthly contribution margin and a constant monthly churn rate, an approximate lifetime value is:

where m is average monthly revenue per customer, g is the contribution-margin percentage expressed as a decimal, and c is monthly customer churn expressed as a decimal. The result is measured in currency per acquired customer. This approximation assumes a constant churn rate, constant margin, no discounting, and an indefinite geometric retention process. It becomes unreliable when cohorts mature, churn changes, expansion revenue is material, or retention is seasonal.

A more general discounted formulation for expected contribution value is:

Here, R_t is revenue from a customer in period t, V_t is variable cost in that period, P_t is the probability that the customer remains active in that period, d is the discount rate per period, and T is the forecast horizon. All monetary values must use the same currency and period. The model is only as good as its retention, margin, and expansion assumptions.

A basic sustainability condition is:

In practice, a venture also needs a safety margin because LTV is forecast-based, cash arrives over time, and acquisition costs can rise. A high LTV:CAC ratio does not automatically indicate healthy growth if the LTV estimate ignores support costs or if the payback period is too long.

Payback period

For a constant monthly contribution margin CM, a simplified payback period is:

The result is in months when both CAC and CM are monthly currency measures. It assumes constant contribution margin and ignores discounting, churn during the payback period, and delayed payments. A cohort cash-flow model is preferable for material investment decisions.

Return on advertising spend

ROAS is a ratio, not a profit measure. If a campaign generates £12,000 in attributed revenue from £4,000 of advertising, ROAS is 3.0×. Whether that is attractive depends on gross margin, fulfilment costs, refunds, overhead, and the incrementality of the sales.

Worked example: comparing two channels

An online training venture tests two channels over one month.

Search CPA is £6,000 ÷ 60 = £100. Partnership CPA is £2,000 ÷ 48 ≈ £41.67. First-year contribution from search is 60 × £180 = £10,800, giving contribution after direct acquisition spend of £4,800. The corresponding partnership contribution is 48 × £180 = £8,640, or £6,640 after direct spend.

The partnership appears more efficient, but the conclusion is provisional. The webinar may have limited capacity, partner management costs may be excluded, lead quality may differ, and some attendees may have converted through another channel. The correct next step is not to move all budget immediately, but to validate quality, incrementality, and scalability.

5. Measurement Architecture and Attribution

Event and cohort design

A credible measurement system defines events such as impression, visit, sign-up, activation, purchase, renewal, referral, refund, and cancellation. Each event needs a timestamp, customer or account identifier, source information where lawful, and a clear definition.

Cohort analysis groups customers by a shared starting point, such as acquisition month or first-purchase channel, and compares their later behaviour. It is superior to a blended average when channels have different maturation periods. For example, a content cohort acquired in January may look inefficient in February but produce strong renewals over six months.

Attribution models

Common attribution approaches include:

• Last touch: assigns credit to the final tracked interaction. It is simple but often overvalues retargeting and branded search.
• First touch: assigns credit to the initial tracked interaction. It highlights discovery but ignores later persuasion.
• Linear attribution: divides credit across recorded interactions. It assumes equal contribution, which may not be true.
• Position-based attribution: assigns greater credit to first and last interactions and distributes the remainder.
• Data-driven attribution: estimates contribution from observed patterns, but requires sufficient data and strong assumptions.

Attribution is a reporting convention, not proof of causation. Incrementality asks what additional outcomes occurred because the channel was used. Where feasible, use geo-experiments, holdout groups, public-platform conversion lifts, or carefully designed before-and-after tests. Randomisation is strongest because it reduces systematic differences between exposed and unexposed groups.

A channel may receive little attributed credit but still assist discovery. Conversely, a channel may receive substantial credit for conversions that would have occurred without it. Managers should compare attributed results with experiments, customer research, and blended business outcomes.

6. Channel Optimization as an Experimentation Process

Channel optimization is a sequence of learning decisions, not a one-time selection exercise.

Step 1: State the hypothesis

A useful hypothesis specifies audience, message, channel, expected mechanism, and success metric. For example: “For operations managers in small manufacturers, a calculator promoted through industry newsletters will generate more qualified demos than generic display advertising because it addresses a measurable cost problem.”

Step 2: Define the unit economics before launch

Set a maximum acceptable CAC based on contribution margin, cash constraints, retention expectations, and strategic value. Define primary and guardrail metrics. A primary metric might be activated customers; guardrails may include refund rate, complaint rate, payback period, and lead quality.

Step 3: Run a sufficiently informative test

A test should have a meaningful budget, time period, and audience. Stopping as soon as a few conversions appear encourages false conclusions. At the same time, tests should not continue after evidence of severe brand, legal, or financial harm.

Step 4: Diagnose the constraint

Low performance can originate in different parts of the system:

• low impressions or reach: audience or distribution problem;
• low click rate: message, creative, or relevance problem;
• high click rate but low activation: landing-page or product problem;
• high activation but low retention: value-delivery or fit problem;
• good economics but low volume: capacity or market-size problem.

Step 5: Scale gradually

Scaling can change the economics. The first audience segment may be unusually responsive; larger budgets may reach less qualified prospects, raise auction prices, or expose operational bottlenecks. Increase spending in controlled increments and monitor marginal CAC, not only average CAC.

The marginal CAC of additional customers is:

where ∆ denotes the change between two comparable spending levels. Marginal CAC is useful for budget allocation because the next pound spent may be less productive than the average pound already spent.

Budget allocation

A practical portfolio separates:

• Core channels: proven channels meeting economic and quality thresholds.
• Growth channels: channels with evidence but incomplete scalability.
• Exploration channels: controlled experiments with explicit learning objectives.
• Capability investment: data, content assets, CRM systems, creative libraries, and partnerships that improve future performance.

The marketing mix should also balance time horizons. Paid search may produce immediate demand capture; SEO, community, and brand content may produce slower but more durable returns. A venture that funds only immediate conversions can become increasingly dependent on auctions and platforms.

7. Applying Major Channels Professionally

Paid search and social advertising

Paid search is strongest when intent is explicit. Account structure should separate branded, non-branded, competitor, and problem-oriented terms where appropriate. Landing pages should match the user’s query and stage of awareness.

Paid social provides reach and rich creative testing, but declared interests and platform profiles are imperfect proxies for need. Test different value propositions, formats, audiences, and post-click experiences. Avoid optimising solely for cheap clicks or platform-reported conversions.

SEO and content

A credible SEO programme combines:

1. technical accessibility, including crawlability and page performance;
2. content aligned with genuine search intent;
3. clear information architecture and internal linking;
4. evidence of expertise and trustworthy authorship;
5. legitimate references and links earned through usefulness; and
6. measurement of qualified outcomes, not merely traffic.

Content should progress beyond awareness. A complete system may include problem education, evaluation guides, comparisons, implementation resources, proof, and retention documentation. AI can assist with topic clustering, summarisation, testing, and content operations, but human review is necessary for accuracy, originality, privacy, and claims substantiation. Mass-produced low-value content can weaken trust and search performance.

Outbound and account-based acquisition

Outbound begins with a carefully defined ideal customer profile and buying hypothesis. Account selection should use legitimate business information, while personal data must be processed lawfully and respectfully. Messages should be relevant, concise, and easy to decline. Sales and marketing should share definitions of a qualified opportunity and record reasons for rejection.

Account-based approaches coordinate personalised content, sales activity, events, and executive engagement around a defined account. Their economics should be judged on account progression and revenue quality, not only on the number of contacts reached.

Partnerships and referrals

A partnership proposal should specify customer value, roles, data responsibilities, economics, service standards, brand rules, dispute procedures, and exit conditions. Referral incentives should not encourage deceptive recommendations or inappropriate disclosure of customer information.

The venture should measure partner-sourced activation, retention, refunds, and net contribution. A partner that delivers many low-quality leads may be less valuable than one that delivers fewer high-retention customers.

Community and advocacy

Community strategy begins with a member promise: what useful access, knowledge, identity, or support will members receive? Governance should define acceptable conduct, moderation procedures, conflict management, and treatment of member content. Advocacy grows from a strong product and respectful participation; it cannot be sustainably substituted by incentives alone.

8. Illustrative Case: Northstar Ledger

Background

Northstar Ledger is a fictional early-stage software venture offering cash-flow forecasting for small professional-service firms. Its monthly subscription is £100, with an estimated contribution margin of 70%. The founders initially spend on social advertising and report many inexpensive sign-ups.

Problem

After three months, the venture has acquired 240 accounts. However, only 40% complete the data-connection step, and monthly churn among activated accounts is 8%. The founders calculate a blended CAC of £62 and believe growth is attractive. Customer interviews reveal that many social-ad respondents signed up out of curiosity and did not understand the implementation effort.

Analysis

The simple subscription LTV estimate is:

£100 × 0.70 ÷ 0.08 = £875.

This estimate assumes constant churn and margin and therefore should not be treated as a guarantee. More immediately, the first-month contribution from a customer is only £70. A £62 CAC leaves little room for onboarding cost, payment fees, and early cancellation.

The team separates channels and activation:

Approach

Northstar changes its mix rather than abandoning paid acquisition. It:

• narrows social campaigns to problem-specific creative and excludes low-quality placements;
• creates search landing pages for cash-flow forecasting use cases;
• develops an accountant referral programme with onboarding materials;
• publishes practical forecasting templates and implementation guides;
• changes the primary optimisation event from sign-up to activated account;
• introduces an onboarding call for high-value accounts; and
• tests a control region where social advertising is reduced to estimate incrementality.

Outcome

After two quarters, the venture has lower top-of-funnel sign-up volume but higher activation and better retained contribution. Partnership capacity becomes the principal constraint, so Northstar invests in partner training and a self-service referral portal. The case demonstrates that a channel decision must account for customer quality, operational capacity, and time horizon—not only headline CPA.

Learning points

1. Cheap acquisition can be expensive when activation and retention are weak.
2. Channel economics should be analysed by cohort and segment.
3. Optimising for a downstream event can improve the quality of algorithmic traffic.
4. Partnerships may be efficient but require systems for scale.
5. Experiments are necessary to distinguish attributed performance from incremental growth.

9. Challenges, Ethics, and Governance

Privacy and consent

Acquisition often involves personal data, tracking technologies, profiling, and customer lists. Organisations should collect only necessary data, establish a lawful basis, provide clear notices, honour withdrawal and deletion rights where applicable, and secure data against misuse. Requirements vary by jurisdiction, so legal review is necessary.

Manipulation and dark patterns

Urgency claims, confusing consent interfaces, hidden costs, forced continuity, and difficult cancellation may increase short-term conversion while undermining autonomy and trust. Sustainable growth treats informed choice and easy exit as design requirements.

Advertising integrity

Paid endorsements should be disclosed. Testimonials must be genuine and not misleading. Environmental, health, financial, and performance claims require substantiation. Comparative advertising should be fair and verifiable.

Platform and algorithmic risk

A venture dependent on one advertising platform, marketplace, search algorithm, or social network faces concentration risk. Rules, prices, reach, and measurement systems can change without the venture’s consent. Maintain owned customer relationships, diversify acquisition, and retain exportable first-party records obtained lawfully.

AI-enabled acquisition

AI can support audience research, creative variation, lead scoring, personalisation, forecasting, and customer-service automation. Risks include fabricated claims, biased targeting, disclosure failures, copyright disputes, privacy leakage, and automated exclusion of valuable prospects. Human oversight, documented data provenance, testing across segments, and approval controls are essential.

10. Best-Practice Decision Framework

Before scaling a channel, ask:

1. Is the target audience clearly defined and reachable through this channel?
2. What customer problem and buying stage does the channel address?
3. Which event represents real value: lead, activation, purchase, renewal, or referral?
4. Are costs fully specified, including labour, incentives, technology, and partner fees?
5. Is performance incremental or merely attributed?
6. Does the channel produce customers with acceptable retention and margin?
7. Can operations, sales, onboarding, and support absorb the volume?
8. What legal, privacy, brand, and platform risks exist?
9. What evidence would justify scaling, changing, or stopping the test?
10. Does the channel strengthen or weaken the venture’s long-term strategic independence?

The strongest acquisition systems are portfolios rather than isolated tactics. They combine channels that capture current demand with channels that create future demand, while using disciplined experimentation to transfer resources toward durable customer value.

Chapter Summary

Acquisition strategy is the design and management of a system that turns reachable audiences into valuable, retained customers. Paid, owned, earned, outbound, partnership, community, SEO, and content channels differ in speed, controllability, trust, cost structure, scalability, and risk. Channel-market fit depends on customer behaviour, buying complexity, trust requirements, and organisational capability.

Sound evaluation requires more than clicks or attributed conversions. Conversion rate, CPA, CAC, contribution margin, LTV, payback period, ROAS, cohort retention, and marginal CAC provide complementary evidence. LTV and payback calculations depend on explicit assumptions and should not conceal uncertainty. Attribution is a reporting method; incrementality requires experiments or other causal evidence.

Effective optimization follows a cycle of hypothesis formation, economic design, controlled testing, diagnosis, and gradual scaling. A balanced portfolio protects the venture from platform dependence and combines immediate demand capture with long-term assets such as content, community, partnerships, and owned customer relationships. Ethical acquisition respects privacy, truthful communication, informed choice, and responsible use of data and AI.

Key Terms

Acquisition channel: A route through which a venture reaches and converts prospective customers.

Attribution: A method for assigning reported conversion credit to marketing interactions.

CAC: Customer acquisition cost; acquisition-related cost divided by newly acquired customers.

Channel-market fit: The suitability of a channel for reaching a target segment with an effective message and buying process.

Community channel: Acquisition based on participation, relationships, shared identity, and member value.

Conversion rate: The proportion of entities progressing from one defined stage to another.

Demand capture: Reaching customers who are already seeking a relevant solution.

Demand creation: Building awareness, preference, or category understanding before active search.

Earned channel: Exposure or distribution voluntarily generated by customers, media, communities, or other parties.

Incrementality: The additional outcome caused by a marketing activity compared with an appropriate counterfactual.

LTV: Expected customer lifetime value, generally measured as future contribution rather than gross revenue alone.

Marginal CAC: Additional acquisition cost divided by additional customers generated by increased investment.

Owned channel: A communication or relationship asset substantially controlled by the venture.

Outbound marketing: Proactive initiation of contact with selected prospects or accounts.

Partnership channel: Acquisition using another organisation’s audience, credibility, product, or distribution.

Payback period: Time required for contribution from acquired customers to recover acquisition cost.

Paid channel: Distribution obtained through direct financial expenditure.

ROAS: Attributed revenue divided by advertising spend.

SEO: Practices that improve the discoverability and relevance of web pages in unpaid search results.

Cohort analysis: Evaluation of groups sharing a common acquisition or starting characteristic over time.

Review Questions

Short Answer Questions

1. Distinguish between paid, owned, and earned acquisition channels.
2. What is the difference between demand capture and demand creation?
3. Why is ROAS not equivalent to profitability?
4. State two assumptions behind the simplified subscription LTV formula.
5. What does incrementality attempt to measure?

Long Answer Questions

1. Compare SEO, paid search, community, and partnership channels for a complex B2B product.
2. Explain how cohort analysis improves upon a blended CAC figure.
3. Discuss the strengths and limitations of outbound acquisition in professional markets.
4. Explain a complete process for testing and scaling a new acquisition channel.
5. Evaluate the ethical and governance risks of AI-enabled acquisition.

Analytical / Application Questions

1. A venture spends £9,000 on advertising and acquires 75 customers. Each customer produces £240 in first-year contribution. Calculate CPA and contribution after direct acquisition spend, then explain what additional evidence is needed before scaling.
2. A subscription product earns £80 per month, has a 65% contribution margin, and monthly churn of 5%. Use the simplified LTV formula to estimate LTV, state its assumptions, and explain why the estimate may be optimistic.
3. Design a channel experiment for a new professional-service product. Specify the audience, hypothesis, test groups, primary metric, guardrail metrics, stopping or scaling criteria, and method for assessing incrementality.

Multiple Choice Questions with Answers

Question 1

Which channel category is primarily controlled by the venture and includes its website, email list, and product notifications?

A. Paid

B. Owned

C. Earned

D. Outbound

Correct Answer: B. Owned

Question 2

A campaign spends £4,000 and acquires 50 customers. What is its CPA?

A. £50

B. £80

C. £125

D. £200

Correct Answer: B. £80

Question 3

Which measure most directly examines whether marketing caused additional outcomes rather than merely receiving credit for them?

A. CTR

B. ROAS

C. Incrementality

D. Impressions

Correct Answer: C. Incrementality

Question 4

Under the simplified subscription formula LTV ≈ m × g ÷ c, what does c represent?

A. Monthly customer churn

B. Customer count

C. Campaign cost

D. Conversion rate

Correct Answer: A. Monthly customer churn

Question 5

Which channel is generally most appropriate for reaching a narrowly defined set of identifiable B2B accounts with tailored messages?

A. Account-based outbound

B. Untargeted display advertising

C. Mass organic posting

D. Generic marketplace listing

Correct Answer: A. Account-based outbound

Question 6

A venture spends £6,000 and reports £18,000 in attributed revenue. What is its ROAS?

A. 0.33×

B. 2×

C. 3×

D. 12×

Correct Answer: C. 3×

Question 7

Why should marginal CAC be monitored during scaling?

A. Average CAC always increases linearly

B. The next customers may cost more than customers acquired initially

C. Marginal CAC measures brand awareness only

D. It eliminates the need for retention analysis

Correct Answer: B. The next customers may cost more than customers acquired initially

Question 8

Which practice is most consistent with responsible community marketing?

A. Treating members solely as promotional inventory

B. Hiding sponsorship relationships

C. Providing member value and establishing moderation norms

D. Removing all negative feedback

Correct Answer: C. Providing member value and establishing moderation norms

Question 9

What is a major limitation of last-touch attribution?

A. It cannot record any conversion

B. It may overvalue the final interaction and ignore earlier influence

C. It requires randomised experiments

D. It measures only offline sales

Correct Answer: B. It may overvalue the final interaction and ignore earlier influence

Question 10

A channel generates many inexpensive sign-ups but very low activation and retention. What is the most appropriate interpretation?

A. The channel is automatically the best channel

B. Top-of-funnel efficiency may be masking poor customer quality

C. The venture should optimise only for clicks

D. Retention is irrelevant to acquisition economics

Correct Answer: B. Top-of-funnel efficiency may be masking poor customer quality