Growth hacking is an encompassing phrase for growth-focused techniques. It is typically applied to early-stage enterprises that require rapid expansion on a limited budget. Growth hacking strategies seek to attract as many users or customers as possible while spending the least money.
What is growth hacking?
Growth hacking is a growing field built on a piece of information, an experiment-based methodology that focuses entirely on growth. A growth hacker actively investigates new growth possibilities at any stage of the customer experience, from awareness to marketing to brand advocates through improving the product. The phrase “growth hacking” was invented by Sean Ellis in 2010 and has primarily been prevalent among startups due to restricted finances and resources. Since then, more people have identified as growth hackers, growth marketers, technical marketing experts, data-driven marketers, or heads of growth. An engineer, like a marketer, maybe a growth hacker. What matters is that they are focused. Because of the startup mentality, they are frequently forced to employ analytical, low-cost, creative, and inventive approaches to rapidly build their company’s client base.
For example, you could consider McDonald’s appearing at every major highway exit in the 1950s to be growth hacking. They anticipated that interstate road would be massive, so they set up shop where they knew consumers would be in great numbers. However, this relatively new notion is mainly applicable to startups. They don’t have much marketing budget.
Think about Uber; the taxi replacement service depends on normal individuals driving their own cars to pick up someone at point A and securely transport them to destination B – and payment is made via the app. This is also incredibly scalable, with over 260 million active automobiles in the United States in 2015. They give the app, which may be downloaded and used by many people over the web. The remainder is up to the users.
A conventional product, such as soap, is not easily scaled. You have to buy fresh soap every time you run out. However, your Facebook experience improves with each new person that joins.
Furthermore, the way the product operates allows it to sell itself. If you take an Uber to a friend’s house on Sunday night and they inquire how you arrived there, you tell them, “I took an Uber.”
Naturally, word gets around. If you appreciate the idea and have friends who may benefit from utilizing the service (along with you profiting from your friends using the platform), you’re inclined to recommend it. That is how growth hacking leverages word-of-mouth on a large scale to generate the enormous growth rates we’ve observed.
Steps for successful growth hacking
Step 1: Create a product needed by your customers
You might be thinking that you all know this already, right?
Coca-Cola has introduced several different soft drinks throughout the years, including Sprite and Fanta. The majority of them did not taste as excellent as Coke. But, because of considerable (and costly) promotion, they became popular and now sit alongside Coke in grocery store drink aisles. It would be much more laborious to do this now because information about a new product rapidly circulates.
If your product is subpar, the rest of the world will find out sooner than you think. You must get your item out there as soon as possible to begin gathering feedback and continuously improve your product-market fit.
To determine whether your product is on target, begin by asking and responding to questions rather than producing a product with excellent product-market fit and then soliciting feedback.
Step 2: Growth hacking should not be used to target everyone
To reach the bulk of people, your product should first pass through the hands of entrepreneurs and early adopters. If your target consumer is “everyone,” there’s no way to go past the first 15% since you don’t know who to persuade to buy.
For example, if you use Gmail, Hotmail appears outdated, and you’ve probably forgotten about it. However, they have expanded to over 400 million subscribers since Microsoft purchased Hotmail. Until roughly 2012, they were forward of Gmail.
Their investor got an idea while contemplating marketing choices such as billboards as to simply include a line at the end of every e-mail their subscribers write that reads, “PS: I love you.” Get a free e-mail account at Hotmail”?
It was well worth a shot, as it raised signups to 3,000 daily, more than tripling their user base in six months. They ensured they targeted the proper target demographic by retaining the ‘ask to share’ within their system.
Step 3: Acquisition
The idea here is to find out how individuals become your leads.
It would help if you comprehended how well your advertisements, SEO, and other marketing methods are doing. Monitor impressions, website traffic, the visit-to-lead exchange rate, and the average time it takes for a visitor to click through. Consider your material more carefully since content marketing is still among the most effective techniques for acquiring new consumers. Think of new ways to provide information or engage an influencer to assist you in spreading the word about the exclusivity of your business’s item or service.
In the well-known iPod commercials with black shapes and white headphones, Apple ensured that everyone would notice its headphones by making them white. Because headphones were typically black, they converted all of their clients into walking advertising by modifying this aspect.
Instead of attempting to duplicate each of these instances, strive to get into the appropriate mentality to find untapped prospects and new methods to advertise your items using comparable approaches.
You don’t have to be extravagant. You may test out existing strategies to evaluate how well they perform.
Step 4: Activation
This step requires you to keep track of the number of individuals who return to your website after initially browsing it. This might be the number of individuals that joined your e-mail list, downloaded your app, or viewed your blog.
For example, if your opt-in form has too many lines, consider deleting one field to shorten and simplify the procedure for your subscribers. Most leads will avoid entering their credit card information in this section, especially when joining to receive a free trial. Or, even ideal, allow them to join up using an existing account, such as one on Google?
Step 5: Retention
Retention is the most challenging yet crucial stage, as it costs five times less to maintain current customers than to employ new ones. Experiment with several techniques to increase customer retention until you find one that works for you. Discover one that usually works for you:
- Send regular e-mail alerts for new items or events.
- Hold time-limited deals.
- Build unique loyalty program
Many businesses spend most of their money on acquiring new clients rather than keeping existing ones. That is just less productive and less lucrative marketing.
The key to retention-based marketing is to prevent being too focused on any channel. Consumers often go from network to network and gadget to device before purchasing. They are browsing various sites and examining various sources.
That’s why it usually takes at least five elements before a consumer will give you a chance. The idea is to combine such elements, so they are always there.
Step 6: Referral
At this point, consider how you will turn your consumers into brand advocates who will inform their colleagues and peers about your product and business. Profits from recommended clients may increase by at least 16 per cent – a terrific motivation to concentrate on your referral program!
You may begin with something simple, such as asking satisfied customers to refer their friends in exchange for a discount or more services. In actuality, this is the way Dropbox got to where it is now. They provided additional storage space to every invited friend and quickly raised their signups by 60%!
Step 7: Revenue
This is the most crucial statistic for gauging your company’s growth. It shows how much money remains after deducting all client acquisition charges (CAC). To determine what has to be optimized to enhance revenue and keep going forward, correlate CAC to LTV (customer lifetime value). Ideally, the CAC to LTV ratio must be approximately 1:3.
To boost this ratio, assess how your product pricing corresponds with the target client, provide a fantastic customer experience, and examine the whole funnel to determine which step requires extra attention from your growth hacking team. You’ll be able to brainstorm with unique solutions if you recognize challenges at each level.
Growth hacking isn’t as complex as it may appear. Also, if your organization is just getting started, you do not need to employ a guru. You can also be a growth hacker. Be creative, open to new ideas, and don’t be scared to go above and beyond the rules. Take benefit of every chance to improve your product and build your brand. Think about who can best represent your organization and the appropriate time and platform.
