Growth hacking is one of the most talked about terms in the recent past. It has been received with mixed emotions – some people have jumped the growth hacking bandwagon proudly tagging themselves as one while some scoff at it, dismissing it as one of those Silicon Valley buzzwords (‘pivot’, anyone?).
What is growth hacking?
Growth hacking, as defined by Wikipedia, is a process of rapid experimentation across marketing channels and product development to identify the most effective, efficient ways to grow a business. Growth hacking refers to a set of both conventional and unconventional marketing experiments that lead to growth of a business.
I think this is one of the most comprehensive and correct definition of growth hacking. Let me break it down.
First of all, growth hacking is a process.
It is not a plug and play system that will magically attract the right set of users to your website, get them to sign up and pay you money for your ‘disruptive’ services.
It is a process, often long and arduous, with the end goal of finding the right target audience, the channels they can be targeted on and the message that is most likely to resonate with them.
Finding this right mix of audience, channel and message requires a lot of experimentation. And because most of the startups don’t have the luxury of time or bucket-loads of money, these experiments need to be super efficient.
With each subsequent experiment you learn a bit more about what is working for your product, and what is not. As you learn more, your experiments become more optimized and with time you figure out the right permutations of the audience-channel-message mix for your startup.
So every company employing growth hacking should eventually grow, exponentially?
Going by the definition of growth hacking, and it’s breakdown – it would seem like an obvious outcome. But there are so many other things at play – that a company’s failure or success cannot be ‘just’ attributed to growth hacking.
A major factor that contributes to the downfall – is not reaching the product market fit before trying to scale up marketing and growth. In other words – trying to acquire users for a product that they don’t really need.
Growth Hacking for your Startup.
I’m sure most of you reading this post are already familiar with the legendary growth hacks of AirBnB and the likes. I’m not going to repeat that but I did want to make a point here, such growth hacks are rarest of the rare. Spending all your time and energy on finding a ‘Craigslist’ style hack for your startup might not be the most optimum use of your resources. Expecting your growth hacking team to do the same is downright foolish.
Once you’re confident of reaching the product market fit – you need to find ways to scale your user acquisition. There are only a few channels that can actually scale and give you sustainable user acquisition. Andrew Chen explains this thoroughly in his blog here.
The Growth Hackers Funnel
Growth for almost business and startup means one thing – revenue. That is usually the true driving metric of a growth hacker. Acquiring new users is just one part of the story. Taking the user through the complete funnel – right up till the point where she becomes a loyal customer and talks about the product to her friends, falls under the purview of a growth hacker.
Dave Mcclure of 500 Startups created the startup funnel, also called pirate metrics – that dictate how a growth funnel for a startup should look like.
- Acquisition – This is the top of the funnel, acquiring new users. The growth team of a startup would need to ensure proper acquisition channels are set up and are growing consistently at a rate of 15 – 20 % month on month.
- Activation – Activation is the part of the funnel that talks about the user’s first experience with the product. The onboarding process, login/signup, user flow through the product, design etc – all fall under activation.
- Retention – Ensuring users keep coming back is pivotal to a product’s success. Finding that ‘Aha’ moment – series of actions, that when performed by the user will keep bringing her back regularly – is a serious growth hack.
- Revenue – Making money from the user. There are only a few ways for a product or an app to make money from their users. This could be using the Freemium model, subscription based services or showing ads. Monetizing your users, while keeping a great user experience is key.
- Referral – Word of mouth is one of the most powerful channels. Leveraging this channel online and encouraging referrals is essential for your company’s growth. Not only is this one of the most cost effective channels – referred users are more likely to convert and are easier to retain!
What makes a good growth hacker
So now that we’ve briefly touched up what is growth hacking and how it applies to startups – let me quickly outline the qualities that define a growth hacker. This will also highlight the difference between a digital marketer and a growth hacker.
There are broadly four skill sets that a growth hacker needs to have:
- Data Analysis – A growth hacker needs to have solid data analysis capabilities. They should be able to figure out what are the key metrics that need to be measured and how can they be measured. The ‘what’ part comes from a deep understanding of the product and the marketing funnel whereas ‘how’ comes from knowledge about different types of analytic tools.
- Content / Copywriting – This is largely where a digital marketer’s and a growth hacker’s skill would overlap. To be able to create content to notch up SEO and solidify inbound channels is very important. The micro content writing part is essentially useful when creating multiple landing pages and ad creatives for paid acquisition. These parts can be offloaded to a full time content person, but the growth hacker should be able to effectively oversee.
- Design Chops – Most of the internet is moving towards more visual content. In such a scenario, it pays to have a growth person who understands what goes into creating great visual content. This skill also helps in creating better landing pages as well as ad creatives!
- Tech know how – Growth marketing involves a bunch of tools and platforms. There are tools that are used in every step of the user acquisition journey. Putting them together, and ensuring they work properly require a bit of tech understanding. For young companies with minimal budgets, a growth hacker should be able to get basic landing pages up by themselves. Hence a hands-on understanding of atleast the frontend tech goes a long way!
I’ve written an in-depth answer to what is takes to be a great growth hacker here.
In conclusion, growth hacking is a process that is focussed on growing the company. Growth means different things at different stages. A prototype needs to reach the product market fit. For a company in this stage, growth means acquiring a few early customers and taking them iteratively through the product. The product itself undergoes multiple iterations. A company that has market validation needs to accelerate it’s customer acquisition and refine the retention.
Getting a good growth marketing team early on can be extremely beneficial for a young company.