“The end goal of every growth hacker is to build a self-perpetuating marketing machine that reaches millions by itself.”
~ Aaron Ginn
Back in 2012, Bill Lee wrote a cheeky piece for Harvard Business Review declaring marketing a dead paradigm. His observation was right on the spot: whether marketers like it or not, traditional advertising approaches eventually lost the battle for corporate growth to an increasingly marketing-sensitive consumer market. The long-drawn-out passing of conventional marketing was when the growth hacking bubble popped up: a term originally coined by Dropbox’s first marketer Sean Ellis back in 2010, growth hacking is a mix of creativity, analytical thinking, product tweaking, and social metric monitoring often deployed by 21st-century startups in pursuit of rapid expansion and increased brand visibility. But isn’t this really what traditional marketing was all about?
Growth Hacking vs. Traditional Marketing
“Growth hackers are a hybrid of marketer and coder, one who looks at the traditional question of “How do I get customers for my product?” and answers with A/B tests, landing pages, viral factor, email deliverability, and Open Graph.”
~ Sean Ellis
Successful startups such as AirBnB, Dropbox, Twitter, PayPal, and many others had at least one growth hacker on their marketing team who ventured beyond the boundaries of what is normally regarded as outside-of-the-box thinking and brought growth medals home. In essence, growth hacking does require knowledge of mainstream advertising tools (especially online marketing), but it also involves collaboration on product development and distribution. For this reason, it is not uncommon to see coders and engineers stepping into growth hacking limelight: just like a new product model builds on its predecessor but is subtly tweaked, redesigned, and upgraded, marketing tools also need to be fine-tuned to the point where merchandise becomes a perpetuum mobile driving sales and corporate growth forward at full speed.
In this respect, a growth hacker is pretty much like a mechanic with a stack of magical tools up his sleeve: they will step up, inspect the entire mechanism, poke and prod at various levers and buttons, grease the cogwheels, adjust the settings to optimal, turn on the engine, and bow out. Unlike conventional marketers, however, growth hackers do not rely on standardized advertising alone to boost corporate performance metrics: they are far more tech-savvy than that. Growth hackers often have technical skills and knowledge required for product reevaluation, so they can identify weak spots and room for improvements, and point out the aspects in which the offerings can be dialed up for optimal performance. So, how exactly do growth hackers use their magical tools?
How do growth hackers do their magic?
“Their job isn’t to ‘do’ marketing as I had always known it; it’s to grow companies really fast — to take something from nothing and make it something enormous within an incredibly tight window.”
~ Ryan Holiday
Growth hackers are driven by passion for innovation, and they are deeply committed to the mission of modifying and marketing merchandise through a hands-on, full-stack approach. Such a comprehensive task calls for a thorough analysis of product features, inspection of distribution methods, assessments of previous campaigns, multivariate testing, landing page redesign, tapping into new promotion avenues, and every other action that can propel growth. From client acquisition and activation to user retention and referrals, growth hackers will keep turning every stone until they fish out the golden nugget of startup success.
Still, growth hackers cannot replace an entire marketing team: they will provide valuable cues and practical assistance on the path of corporate growth, but they are not a substitute for in-house marketing strategists. One more thing a growth hacker cannot do is strike the gold vein overnight and keep bleeding it for a steady stream of revenues endlessly: long-term growth requires long-term efforts, regular system updates, consistent implementation of effective marketing strategies, and commitment to innovation and business expansion.
To bring new customers to your doorstep and foster sustainable growth, growth hackers will engage in various procedures that can but do not necessarily have to follow a uniform formula. The list of steps in the growth hacking process includes:
- analysis of current product state;
- proposing growth-oriented design/feature adjustments;
- scaling efficiency of marketing campaigns to date;
- landing page assessment and tweaks;
- examination of brand visibility and ratings;
- evaluation of existing distribution channels;
- monitoring customer acquisition and retention ratios;
- assessment and/or redefinition of user profile;
- deployment of various analytics to track efficiency changes en route;
- performance of A/B and other tests;
- all other activities relevant to growth.
If handled properly, growth hacking will eventually result in a series of changes in the business model, product, marketing, and distribution, and produce a custom-built growth strategy that draws on successful experiences from the past modified in line with new conditions and current market outlook. Of course, few growth hackers will be able to pull all that off at first attempt – shots in the dark can hit bulls-eye through sheer luck, but deep-reaching growth-driven changes require due considerations, careful execution, and cross-comparison.
Examples of successful growth hacking campaigns
“If you want to go viral, it must be baked into your product. There must be a reason to share it and the means to do so.”
~ Ryan Holiday
One of the best-known growth hacking endeavors, AirBnB’s automatic ad posting on Craigslist via API integration was a precedent of a kind in the LOBA domain. AirBnB offers services aimed at connecting people in need of accommodation with homeowners who have spare rooms to let, and the beauty of their cunning growth campaign lies in the fact that they managed to expand their audience to tens of millions of Craigslist users with the help of simple and smooth ad-hoc integration, no extra costs attached. This is where traditional marketing experts would have failed miserably: AirBnB’s team came up with a tech tool few marketers, however experienced and open-minded, would have been able to think of, let alone implement.
Another successful growth hacking stunt, PayPal’s friend referral bounty played a major role in the company’s early growth. What PayPal did to attract tens of millions of new customers was pay USD 10 to every new user, plus another USD 10 to every user who brought along new sign-ups by referral. What ensued was fast, viral, and investment-exponential growth which could not have been achieved through any other means (they did try costly advertising and BD deals with major banks, but to no avail): with a little gift, PayPal finally had the buzz needed for a global takeoff.
Instagram is another brand that built its early success with the help of growth hacking techniques. To attract and activate new users, Instagram tapped into Twitter and Facebook user databases (only unlike AirBnB, the Insta-team opted for fair play), leveraging product distribution to the internet’s most populous social platforms. Other tricks that helped Instagram hack its way to massive popularity included high service speed, default public picture posting, and asymmetric follow model based on Twitter’s system.
Down the growth hacking funnel
“Basically, growth hacking is a scientific method that requires a full-stack approach to growth – total marketing, engineering, and product integration.”
~ Bronson Taylor
Though Dave McClure’s Pirate Metric funnel may be more popular, Neil Patel and Bronson Taylor’s brainchild is in most cases better suited to up-and-coming businesses looking to avoid detours on the growth track. In essence, the funnel is an instrument online startups use to steer the behavior of visitors from the moment they arrive on the website to the moment they convert and come back for more. The funnel can broadly be divided into three sections:
- Attracting new viewers
- Transforming viewers into users
- Retaining users
All of the steps in the process are important for sustainable growth, and each of them requires a different skill set and approach. While acquiring new visitors will boost brand visibility, it will not on its own result in conversion increase unless activation and retention are handled properly. For this reason, growth hackers will look into all the stages in the funnel with due care and devise methods to streamline the viewer-to-user transformation with maximum efficiency.
Step 1: Visitor acquisition
A top priority for online marketers, visitor acquisition can be achieved by different methods, which are generally divided into Pull and Push tactics based on approach subtlety, or lack of it thereof.
Pull strategies comprise use of infographics, webinars, slideshows, podcasts, eBooks, guest posts and other types of content that can present the brand as a niche authority. SEO and social media campaigns also fall in the Pull bucket as their ultimate goal is to leverage audience from other blogs or online communities and draw its attention (ergo, pull) to the company’s website in hopes of conversion growth. Many growth hackers prefer the Pull method to Push tools as it entails lower costs and is less intrusive (as we already mentioned, 21st-century consumers are very sensitive to blatant marketing tactics).
Push marketing is less subtle than the Pull method, but it can be used to ensure steady inflow of website visitors and improve brand visibility. Most common Push tools include PPC, ad purchase, collaboration with non-competing brands, point-of-sale displays, promo swaps, etc. However, before investing in a Push campaign, you need to educate yourself about the user’s lifetime customer value and cost per conversion to avoid losing a fortune on advertising which may not result in satisfactory ROI.
In addition to these two techniques, growth hackers have come up with a third method to attract new visitors: with product-oriented tactics, the merchandise can be tweaked and updated to promote itself. This is usually achieved through analysis of consumer-relevant info gathered by means of social networks, API integration, built-in social sharing options (e.g. network updates automatically posted from fitness, travel, and other lifestyle-oriented apps), or by insertion of backlinks into the product.
Step 2: User activation
Once visitors come flocking to your website, you need to cajole them into taking action and becoming users. This can mean prompting them to sign up for an account or a newsletter, entrust you with personal information such as name, age, and e-mail address, complete a survey, post a comment, join a discussion, or anything else that will make them a part of your user database. To this end, you can utilize on-site optimization, compelling call to action buttons (people love to click those), gamification, Thank You pages, etc. Rather than sticking to one user activation tool, growth hackers often experiment with different methods to optimize the site for maximum activation efficiency – although customer behavior generally follows a relatively uniform pattern, certain niche or user profile specificities can break startup success even before it hatches.
Step 3: User retention
An army of loyal customers is the best proof of service or product quality, but converting a first-time buyer into faithful follower does require special considerations. To maximize retention, growth hackers often use drip-mail campaigns, event notifications, feedback prompts, and other means of communication with users. In this regard, the job of a growth hacker is more flexible than that of a marketer: in case existing customers are not satisfied with the service or product or have suggestions concerning merchandise features or design upgrades, they can use the feedback to fine-tune the product for improved user experience. That said, A/B testing is still a critical (and commonly used) tool in this part of the funnel, but direct feedback is usually more valuable as it can point to certain product/service aspects which a traditional marketer would never think of reevaluating.
As for successful user activation and retention examples, Twitter and their tutorial stand out proud and high. By identifying the AHA moment (the point when the customer begins to appreciate product value and benefits), the social network managed to adjust their business approach and increase retention rates. Adding prompts for new users to follow existing and influential Twitterers, the platform made the experience more interesting to new members, boosting retention rates and visitor engagement, and the tactic helped hack early growth which the network continued to build on to this day.
If tackled properly, user retention can result in referrals, effective testimonials, and other means of organic brand promotion. Of course, product/service quality are essential for this to happen, but growth hacking combined with certain marketing tools can help attract the type of clients which will show their love and care by spreading the good word about your startup’s offerings.
“Growth hacking is not a 1-2-3 sequence, but instead a fluid process. Growth hacking at its core means putting aside the notion that marketing is a self-contained act that begins toward the end of a company’s or a product’s development life cycle. It is, instead, a way of thinking and looking at your business.”
~ Ryan Holiday
Growth hacking is a challenging and creative job which requires resourcefulness, solid knowledge of marketing, distribution, and product development procedures, razor-sharp analytical skills, a penchant for experimentation, and critical thinking. The tactics and procedures listed above are only the tip of the iceberg – and the iceberg is growing fast as the internet continues to evolve and search engines are turning extremely wary of marketing shortcuts and promotional pick-me-ups. For this reason, growth hackers are nothing short of magicians in 21st-century marketing and product development – and their willpower cannot be swayed easily. Capable of enduring series of failures, let downs, and dead-end alleys, a deft growth hacker will finally strike the mother load and return home with hands covered in blisters and gold dust.
- – Growth Hacking Tactics That Every Startup Needs To Know
- – Harvard Business Review: Marketing Is Dead, Bill Lee
- – The Definitive Guide to Growth Hacking, Neil Patel & Bronson Taylor
- – The Difference Between Growth Hacking And Traditional Marketing
- – Growth Hacking is the New Inbound Marketing
- – 13 Critically Important Lessons from Over 50 Growth Hackers
- – 21 Actionable Growth Hacking Tactics, Jon Yongfook
- – Defining A Growth Hacker: Debunking The 6 Most Common Myths About Growth Hacking
- – Top 10 growth hacks of all time
- – What are the top 10 consumer internet growth hacks that have been A/B tested?
- – Inbound Marketing Vs. Growth Hacking — Why One Outperforms The Other
- – Growth Hacking is the New Inbound Marketing
- – Growth Hacker is the new VP Marketing
- – Difference Between Push & Pull Marketing
- – Airbnb: The Growth Story You Didn’t Know