Chances are you’ve been hearing more and more about growth hacking over the last few years. Every corner we turn in the marketing sphere, someone claims to be a growth hacker. They are likely promising you things like a triple digit growth percentage a year. But what’s actually behind this revolutionary tactic? In this article we will pop the lid off of the confusion around the term growth hacking and present you with some actionable tips to put into action, whether you’re a startup or an already established business. But first, let’s talk about what growth hacking is.
What Is Growth Hacking?
If you’re not a complete novice in the marketing field, you have probably picked up on the term growth hacking. Growth hacking is the process of attracting, engaging, and retaining customers. It is focused on relentless experimentation and a focus on the unique, changing motives and preferences of your customers. Basically, it’s following a long to-do list of marketing tactics with high potential for traction. However, instead of being a fixed role, growth hacking is somewhat of a mindset. From developers to conventional marketers, theoretically everyone can be a growth hacker, as long as experimentation and brand expansion are the focus of every action and reaction. Every business has thought about hiring a growth hacker, since presumably every company would like to further grow.
How Growth Hacking Has Changed Marketing
Growth hacking is a relatively new concept, but evidence of growth mindsets date back to the mid 20th century and it wasn’t always digital. Think of McDonald’s and its meteoric rise to prominence. McDonald’s used the fact that in the 1950’s highways were being built in the US at rapid speeds and understood that this would bring with it an opportunity to advertise their brand to hungry people in a hurry (they’re ideal targets). They proceeded by placing a banner for their products at freeway exits in order to maximize the number of eyes on what they were offering. This paid off in spades. This was an early, unconventional way of growth hacking. They thought outside the box, identified an opportunity, moved quickly, tested it and measured results. Ever since, McDonald’s has been prominently displayed on most exits.
Growth Hacking in the Current Age
When you think about the McDonald’s example you can see that they were connecting with people at the right time and place (specifically those looking for something to eat on a new journey). Today, unlike in the 50s, we have something much more efficient and measurable than ads on highways–the internet. Modern day growth hackers consider every avenue that has the potential of becoming a new source of traffic. For example search engines–the highway of the internet– act as an avenue for people to best answer their problems. Growth hackers can see this clearly and quickly find a way to position their company as the solution that helps searchers improve their lives. This, like the satiated highway travelers, leaves them happy and grateful to have encountered the company when they did.
When drawing up a growth hacking strategy consider areas where your customers might be looking for products in your niche. Furthermore, questions such as “Can this product or service expand rapidly?” “Is it scalable and do I have the infrastructure in place to scale?” should arise. If the answer to these questions is a resounding “Yes” then congratulations, you can proceed with growth hacking.
Traditional Marketing vs. Growth Hacking
Traditional marketing is focused broadly on selling a product or service. It taps into more traditional tactics like advertising, PR and sales enablement to advance the business. Growth hacking on the other hand is dedicated to, well, growth. Everything a growth hacker does has a hypothesis to test and a goal of growing the business. When looking at Traditional Marketing vs. Growth hacking, you can also see them as long term and short term tactics respectively. One does not replace the other, but rather support each other in building a successful and agile marketing function. It’s important to balance your business between a long term marketing plan and short term marketing strategy.
Growth hacking encompasses experimenting with and implementing strategies that are focused on efficient and rapid business growth. Growth marketing is hyper-focused on conversion and revenue. Meanwhile, traditional marketing has many measures of success. It is especially useful for businesses that are starting to grow as it empowers them to test and repeat to find traction channels. Both startups and established businesses can take advantage of growth hacking.
Growth Hacking for Startups
By definition, startups are young companies that are itching to grow. In the startup phase, a business emphasizes addressing their ideal customer. The battle for a small market share often seems very overwhelming. Startup companies always have to try new things to build a customer base that doesn’t cost more than they can justify spending to the investors.
You have probably heard of SMART goals. It’s absolutely imperative that your business sets itself Specific, Measurable, Attainable, Relevant and Time Based goals. Make sure to set targets that are not vague and where your input and its effectiveness can be measured. In addition to that, they should also not be unrealistic to complete within the time frame you gave yourself.
As an example, simply saying “I want to have 100 paying customers for my app” is not enough. Instead aim for “I want to have a revenue of $10,000 each month by the end of the year. This goal is specific, measurable and very achievable.
A classic actionable first step of growth hacking for startups could be to create an email list. Offer an E-Book or a checklist where the user is required to enter their contact info to download the file. Once you have gathered email addresses of your target customers, then you can inform them that once your product or service has been launched.
Another tool that startups can use is to try to collaborate with a more established company that will advertise your product or service on their platform. Using their reach, your startup can then grow its initial audience base rapidly. Back in 2013, Dropbox used this exact trick. They collaborated with Samsung, offering everyone that purchased a Samsung phone that year 50GB of free storage on Dropbox, where a regular free account only offers 5GB.
Growth Hacking for Established Businesses
There is a misconception that growth hacking is only for startups. That’s false. Established businesses that have already gained traction and built a solid customer base can also find benefits in growth hacking.
Since established businesses have the ball somewhat rolling, they are usually much more risk averse. They have already built something that works and are therefore somewhat hesitant to deviate from their success formula. However, this way of thinking limits your business and prevents you from tapping into further growth. If you’ve already come so far as a business, chances are it will not collapse if you tweak and test new things. The potential unrealized gains of growth hacking could be endless.
In the case of an established business, the most sensible way of proceeding with growth hacking is to choose a small subset of your customer base where you can implement A/B tests. You would then introduce small changes to your ads, landing pages and social campaigns to see how this small subset responds to them and whether there are more conversions. Make sure to only make changes to one of these channels initially so that you know which tweaks had an effect.
The implementation of data and analytics is critical for growth marketing. A growth hacker needs to incorporate and analyze their actions analytically and draw conclusions from there. Key Performance Indicators (KPIs) such as Click Through Rate (CTR) and conversion rate will greatly help. They help you measure the effectiveness of your tweaks. However, it is advisable to hire an agency to do the growth hacking for you, compared to doing it yourself. The effectiveness is greatly enhanced with the knowledge of industry leading experts.
Growth Hacking in Practice
So how does growth hacking come into effect? The AARRR framework sums it up brilliantly.
In this phase, it’s critical to find a cost effective channel to showcase your product or service to your target audience.
This is the step where you need to convince your target audience to actually use your product or service.
Doing successful and sustainable business is not a one and done thing. You have to build a relationship with your target audience in order to keep them coming back to you.
Word-of-mouth marketing is one of the most effective methods of gaining traction amongst a customer segment. As a business, it is crucial to encourage your satisfied customers to promote your brand to those around them.
Ideally, if you follow these steps, you should be able to grow a sustainable revenue stream and conduct business in the short as well long-term.
Growth hacking is an interesting trend that gives us glimpses into the future of internet based companies. It is applicable for both startups and more established businesses who have already figured out a blueprint for their business processes. Both of these types of businesses can implement the AARRR technique in order to facilitate their growth hacking ventures. While growth hacking can achieve amazing results, it is also crucial to keep a balance between traditional marketing in order to achieve long-term sustainable growth. Sean Ellis coined the term growth hacking and summed it up best: “Growth is not just a concern of sales and marketing, but of product, engineering and support too. It is this organization-wide commitment to growth that ultimately sets these companies apart.”