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Acquire Customers, Not Just Visitors - An Up-and-coming Berlin Start-up Promises Higher Conversion Rates

Customer acquisition is an integral part of successful marketing. However, the focus on getting new people to click on an ad or product can lead to losing sight of the business end: are you creating visitors or paying customers? Compado’s customer acquisition platform, a start-up from Berlin, Germany, promises to deliver the latter, but how effective is it really?

Recommendation Technology and its impact on digital customer acquisition

The recent years saw a drastic change in customer behavior: there is less and less tolerance for generic, non-personalized products or run-of-the-mill digital marketing. Two years of global pandemic have shaken up the world and accelerated this process.

Marketers everywhere find themselves confronted with this new reality. A silver lining in the cloudy sky of modern advertising is the use of brand and product recommendation technology. Offering the right product at the right time has recently become possible and soon will be the new standard.

Platforms like Compado’s are already achieving this new level of recommendation quality - and are able to attract hundreds of thousands of shoppers daily. Instead of sifting through endless waves of irrelevant products and ads, consumers are presented with meaningful content and offers relevant to their taste.

Advertisers, on the other hand, are likewise excited about the new advantage over traditional channels. Recently, Compado has been featured as one of the best alternatives to Google Ads, mostly due to delivering relevant recommendations instead of a barrage of meaningless ads.

A glance at Europe’s leading customer acquisition platform

Berlin-based tech platform Compado promises to deliver paying customers instead of just visitors. An almost revolutionary approach for an industry that has been focused on clicks alone for all too long. After all, PPC, Pay Per Click, is still an omnipresent concept in the business.

Traditionally, online conversion rates have been in the lower digit range, around 1 to 3 percent, depending on one’s industry, target group and approach. Everybody has been trying to get these numbers up, of course, with only a few advertisers being able to outperform average conversion rates. But conversion rates for most have been mediocre.

Berlin’s Compado is taking an entirely different approach: their tech platform is not trying to get more people to see your product, they are trying to get the right people at the right time to see your product.

Compado calls their users a “purchase-motivated audience”. Quite a different term than “searchers”, the word Search Engines such as Google use for their audience. As the name suggests, a purchase-motivated audience has been identified as being interested in buying a new product or service.

The recipe for finding this valuable group of people is simple:

  • The company uses “frontends” like reviews, rankings, quizzes and other highly sought-after content to attract millions of users every day.
  • With the help of their sophisticated technology, the company is then analyzing the visitors’ characteristics and presents them with seemingly fitting brands.

It’s not just a one way street

This form of intent marketing would not work with any generic product. A purchase-motivated audience is still not willing to jump on an offer that is not personalized or buy from a brand that is not value driven. Compado would chase their own audience away by throwing irrelevant recommendations at them!

As a consequence, companies who want to successfully use the customer acquisition platform to find high quality leads are expected to prove their attractiveness to Compado. Compado is not making a secret out of the fact that only value driven brands can get the maximum out of their frontends.

“If we are matching customers to offers, we’re pointing our users towards value driven brands,” says Compado CEO Andreas Hoogendijk. Hoogendijk adds, “we’ll look at factors such as a brand’s customer value or or a brand’s sign-up rates to gauge its attractiveness; it’s in the user’s best interest to be matched with an attractive and appreciative brand.”

While every brand is eligible to request access to Compado’s platform, the Compado customer acquisition system will just not be as effective for commodity brands as it would be for a high quality, industry-leading brand.

Audiences that have been identified as purchase-motivated through their use of Compado’s frontends will be matched with value-oriented brands first. For brands this means they can’t simply buy their way into highly desired target groups!

For marketers, not being able to throw money at the problem is a highly unusual feeling. But if you take a closer look into Compado’s tech platform, it makes sense: the company is offering a service to both advertisers (by matching them with purchase-motivated customers) and users (by offering high quality content like rankings, reviews etc.)

In fact, content that points users in the right direction may be the very reason why Compado has an audience in the first place. Without helpful content, they couldn’t match users to brands at scale.

In this light, Compado is not a one way street! Market-leading, value oriented brands can use the customer acquisition platform to get matched with purchase-motivated users. But if you can’t prove that you offer a high quality customer experience, you will not be able to get the most out of Compado’s customer acquisition.

This doesn’t mean that the platform is not for you at all, mind you! The number of matches will be lower, and the effect on your sales will be smaller. But since you will only be billed for successful conversions, it still makes sense to try (if not for the extra sales, then to gain some hands-on experience with intent marketing).

A look under the hood: Pay-Per-Customer Billing and spiking conversion rates

The advertising industry is full of big promises, and oftentimes not much else. Compado is taking a different approach: you only pay for each customer! If your brand does not get matched with an audience or the conversion is just not happening, your valuable budget is safe.

This can take a lot of pressure out of your investment. If purchase-oriented audiences are as valuable as the company claims, you will see it in your sales. If they should fall short (or if your brand is not a good match), there is no harm done, since you won’t get billed.

With this approach, Compado makes an enticing offer. Many marketers use the company from Berlin to dip their toes into the deep waters of intent marketing. And most of them stay with Compado, as you can see by their impressive list of partners that includes language-learning giant Babbel, global meal-kit powerhouse Hello Fresh and audio-book icon Audible.

But let’s get down to business: how much more valuable are purchase-motivated audiences, really? Compado claims an average conversion rate between 10 and 20 % instead of the common 1 to 3 percent! CEO Andreas Hoogendijk boasts, “put us to the test!”

“Expect us to grow your customer base month by month, as our technology learns and begins to understand your brand better,” says the CEO. In fact, if you start with this form of digital customer acquisition, you will most likely see a small growth in sales at first. The longer you stick with the intent marketing platform, however, the faster your audience will grow. While increases of multiple hundred percent in a few weeks are not at all uncommon, “we’re in for the long-run,” says Hoogendijk. The gradual increases in new customers won through the platform are a result from the AI’s ability to learn more about your brand, the customers and to facilitate better matches down the line.

The combination of only paying for actual sales and a strong growth in customer numbers makes this a solid customer acquisition offer worth trying. Worst case scenario, you’re only wasting time and energy, but at least not your marketing budget.

Great product but no magic bullet

Using intent marketing has been on most marketers' to-do list for a while now. Compado offers a great way to start by matching your brand and products with purchase-motivated audiences. The tech platform offers a full service that delivers an astonishing number of new customers over time.

As an addition to regular digital customer acquisition, such as Google Ads, it can bring a lot of value to your marketing mix. It’s also a great tool to open up new target groups and (highly desirable) customers that you could not reach otherwise.

The reason is simple: the company provides AI-optimized content through their multiple frontends and media sites. It would be impossible to recreate this sort of reach by yourself, no matter how strong and well-funded your content marketing team is.

Despite all its benefits and proven track record, Compado is no magic bullet! If you can’t prove your brand’s attractiveness to the Berlin company, the effects will be limited. Compado is trying to offer an excellent experience to its audiences and will preferably match brands that can deliver such an experience.

While this sounds intimidating at first, it can actually provide a benefit that you can’t find on the company’s website or in their PR arsenal: the customer acquisition platform serves as a form of benchmark. Your success with Compado’s purchase-motivated audiences shows you very clearly where you stand in relation to other brands and which areas you need to improve on.

If you’re confident in your brand and products, Compado can be a lucrative addition to your marketing mix. But even if you’re not fully convinced yet, and you just want to give it a spin, the offer is inviting.

The company’s business model of only billing you for actual sales leaves you with very little risk. Calculating if it is worth the investment is a straightforward process, since you can immediately see cost and effect.

This makes Compado a good option to start with intent marketing. If your brand is leading its field or can truly excite customers, you will gain a lot of exposure and additional sales. If you’re not that confident in your products, it might still be a good way to test the waters and update your marketing strategy.

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About The Authors

Alberto Thompson

Alberto Thompson - I live in Vancouver, Canada, and work as a web developer and graphic designer. Back end programming (PHP, Django/Python, Ruby on Rails) to front end engineering (HTML, CSS, and jQuery/Javascript), digital usability, user interface, and graphic design are all areas of web development where I spend my days. I'm a huge fan of web creation and design in all of its forms, as well as assisting small businesses and artisans with their online presence.

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