If you are connected to the startup scene at all, you have probably been surrounded by the term growth hacking. For a few years now, growth hacking has been a buzzword. In fact, it has sometimes been hailed as the magic ingredient for success and an overnight fix of all startup issues.
The reality is a bit different. Rather than a quick fix, growth hacking is about changing your mindset and approaching your startup differently. It’s definitely a long-term commitment by the whole team. For a deep dive into the topic, take a look at this General Assembly video on Growth Hacking.
If you’re new to the topic, this article is a great start. You will learn about the concept, consider examples, find out how you can introduce growth hacking to your organization, and learn to apply metrics to measure your success.
What Is Growth Hacking?
For startups, growth is everything. During their first years, companies have to grow exponentially, or they can’t survive. Traditional business areas like engineering, marketing, and programming are not always best placed to address the challenge of growth.
Leading European growth hacker, Ward van Gasteren defines growth hacking as “a new field focusing solely on growth, based on a data-driven, experiment-based process.” This definition makes it clear that growth hacking is about more than marketing. It is about having one single purpose of increasing the number of customers a business has.
The term itself was coined in 2010 in a blog post by the original growth hacker Sean Ellis. Sean is credited with helping several internet companies in Silicon Valley achieve outstanding growth. He set up processes, systems, and mindsets within the companies he supported. The consequence? They grew their user base quickly and cost-effectively.
Sean Ellis’ success had unintended consequences, too. When he was ready to move on to his next project, he found it difficult to hire a suitable replacement. There was no shortage of applications from highly qualified and experienced marketers. However, the person Ellis was looking for was someone “whose true north is growth”.
In essence, a growth hacker is a go-getter with a mindset that is open to tolerating some degree of risk. Growth hacking means being open to data-led experimentation and using the limited resources of an early-stage startup creatively with one goal in mind – growth.
Consider this…. 1. When was the last time you tried something new? 2. How many experiments are you currently running? 3. What’s one thing you learned about your business over the last month? |
Innovation is a big part of growth, as is having the courage to do things differently. Most growth hackers work with limited budgets, especially in the early stages of a startup’s development.
Whilst definitions differ, the one characteristic successful growth hackers have in common is a certain mindset. The questions in the box help you assess whether you already have that mindset or whether it’s time to grow for growth. There are no wrong answers.
Examples of Successful Growth Hacking
The easiest way to understand how growth hacking strategies work is to look at examples.
Dropbox
Dropbox is the original growth hacking example. The company began like many other startups with an almost non-existent budget and managed to build a $10 billion company.
Dropbox achieved this by improving its product for the user every time they shared it with friends.
Every time a user invited a friend, they received more storage space. The cost to the company for each new user was simply storage space – much more cost-effective than advertising spend.
Including the referral in the onboarding process meant Dropbox had the attention of their customers already. Integrating the invitation with platforms like Google made it easy for customers to invite contacts. The more space a user had, the more loyal they were likely to be to Dropbox.
Uber Eats
When Uber started its journey toward becoming a worldwide taxi service, it started small and listened to its customers. Uber Eats grew in exactly the same way.
The service started when the original Uber showed signs of slowing growth. How could the company continue growing at its exponential rate? To test whether food delivery would work for the business, Uber started in only one city, Toronto. They tested their standalone app and responded to market reactions in real-time. With Toronto working well, other cities were added one by one. To this day, Uber Eats food delivery is customized to each city in which the service is available.
By now, Uber Eats delivers on average $10 billion worth of food each year. This means the company is one of the world’s largest food delivery services, with its success based on a slow, scalable release. Interestingly, about 40% of Uber Eats app users never used Uber before the food delivery existed.
How To Get Started With Growth Hacking
It’s hard to change your entire mindset overnight but it’s easy to start integrating growth hacking techniques into your business today. There is no right way or wrong way for getting started – generating growth is different for every business. Here are a few tips on how to get started.
Growth Hack your Product
Native Advertising
Geo-targeting
Social Media
Growth Hack Your Product
Growth hacking strategies are not limited to marketing. To truly decipher the meaning of growth hacking, everything your business does needs to be open for improvement. Starting with your product or service, then your assets, and eventually looking at your marketing will unlock growth.
Restricting yourself to marketing alone means losing out on the majority of growth opportunities before you even started. Some of the most remarkable results have come from incredible product improvements. Whether you are selling a physical product or software as a service, there is always something that could be done better. As individual as growth hacking strategies may be, the most successful ones start by improving the product.
Native Advertising
Have you tried native advertising? Native advertising mimics the form and function of the platform on which it is placed, basically making your advert look like editorial content.
Where traditional advertising is disruptive – banners stick out at the top of a page to distract you from the content you were looking at – native advertising feels organic.
By appearing like they are part of the page’s editorial flow, these adverts blur the lines between editorial and advertising. They generally achieve higher click-through rates than standard adverts. This is not only because of their design but also because most native adverts focus on content. Rather than selling a product outright, you are solving a customer’s problem with the help of the content provided. The sales you generate are more of a (much intended) side effect.
Mindful Geo-Targeting
Where does your audience live? If you don’t have an answer to that question, it’s worth taking another look at the geographic location of your customers. Platforms like Google or Facebook and others allow you to track the location of your customers. This is a highly valuable feature. For example, if you are trying to reach high-net-worth millennials, you can target your adverts in specific neighborhoods.
Think about potential hubs where you can target potential customers. Students may not be your target market right now, but they are likely to become high(er)-net-worth individuals once they leave university. Creating strong customer relationships at a time when these individuals are on-campus and therefore easy to target will pay dividends later when they move to more geographically diverse locations.
Social Media
Remember social media is called social for a reason. All social media platforms intend to create and encourage two-way conversations. Creating content and scheduling it is your first step, but it’s only the beginning of a successful social media strategy.
Growing your audience and delivering results requires activity. That means following relevant people and interacting with them. Reach out to other users and drop them a message or post a comment.
Think about the importance of social media for your brand. If it is one of your most important marketing tools or tactics, this importance needs to be reflected in the time you allocate to it. Sitting back and simply pushing out content will not deliver the same results.
How To Measure Growth Hacking Metrics
Successful growth hacking is about data-backed experimentation. Without gathering data and analyzing it, you don’t know what has worked most effectively for you. Looking at the growth hacking tips above here is how to measure their success.
Measuring Experimentation And A/B Testing
Measuring A/B testing is relatively straightforward. For example, comparing two versions of a visual for a banner advert will give you a clear idea of which visual generated more impressions and click-throughs. A/B testing makes it easy to choose between the versions.
When it comes to trying new things, it’s worth trying something more than once. Assuming you have an experimentation budget for advertising in a new social media channel, don’t simply place one advert. You will learn from the first attempt, and your second experiment will be better. If that’s the case, you can then use the third attempt to confirm your findings.
Measuring The Success Of Your Product
When it comes to improving your product, look at your customer journey. Which elements can be better? Are there any steps that can be removed from the process? How can it be easier, faster, or cheaper?
With the change made, measure subscriptions or purchases after a set amount of time to see whether the change has made the desired effect.
Measuring Native Advertising
Native advertising generates more click-throughs than, for example, banner adverts. If you are using both tactics, it’s easy to compare the results.
If native advertising is your only digital advertising activity, the best metric depends on the content of your advert. If the purpose of the advert is to generate sales of a specific product, linking sales to the content gives a good insight.
Measuring Geo-Targeting
One simple way of testing the effectiveness of geo-targeting is offering a website in different languages depending on where the user is based. Allow users to change their language, and you will be able to see which site converts better. If you are offering an eCommerce product, consider offering different things in different markets. Sales conversions will indicate which works best.
Measuring Social Media Exposure
Each social media platform has slightly different metrics. Common metrics include overall reach and interactions. Platforms like Instagram also allow you to break down your reach into existing followers and non-followers.
If your target is to grow your audience, then measuring the number of non-followers that saw a specific post is key. However, creating loyalty among followers generally requires interaction. In most cases, a two-pronged approach is most useful.
Successful growth hacking starts with changing your mindset. No one is expecting you to change everything your company does overnight. Instead, start by choosing one tactic you would like to try. This is your first experiment and a great way of integrating growth hacking into your current workflow.
If you’d like more help or inspiration, we’re here for you!