Naiyya Saggi, Co-founder of The Good Glamm Group, said having a strong community could help reduce a brand’s customer acquisition cost.
“With a very strong community, and the right sort of content funnel, we have been able to bring the cost down to about half a dollar, which used to be at $10 earlier,” Saggi said during a fireside chat at YourStory’s TechSparks Mumbai.
For digital-first brands, having a lower CAC proves to be extremely important, as it helps increase the profitability margin.
In the last two to three years, brands are witnessing a rise in CAC. As the pandemic lockdowns forced the closure of physical stores, almost every brand was advertising through digital platforms, pushing up advertising costs, thus increasing CAC.
In the post-pandemic world, customers can be acquired through physical stores and by building engaging communities. Many brands are also contemplating gaming as a way to increase customer engagement, she said.
“Gaming is another interesting aspect, which generates very good engagement. But it is only one facet. If you personalise your content, then users would want to stay with the brand. And that loyalty will bring repeat purchases and further recommendations,” Saggi added.
The former Facebook (now Meta) employee started Baby Chakra in 2015. The platform got acquired by MyGlamm (now The Good Glamm Group) during the beauty brand’s acquisition spree.