According to Statistic Brain, 71 percent of all startups fail within 10 years of their inception. There is no doubt that the Internet and advances in technology has made it easier for people to start new businesses, but in no way is it easier for those businesses to succeed. What are some of the characteristics of the 29 percent of startups that do realize success? They all managed to capture an audience base and rapidly grow and retain it. This is often where growth hacking – an intersection of marketing and coding that focuses all efforts on the growth and development of a product, brand or business – comes into play.
What Exactly is Growth Hacking?
Growth hacking uses a combination of creative thinking, analytics, research and marketing to help a company or brand grow very quickly. Usually, this growth is in terms of new customers, clients or users acquired. Growth hacking is fairly recent buzzword (read about the history of growth hacking here) coined in Silicon Valley as a byproduct of the tech startup industry.
The philosophy behind growth hacking suggests that the main marketing focus of a new product should be lean and sustainable growth. In the startup context, this makes a lot of sense. Most startups do not have the funds necessary to effectively tap into traditional marketing channels (which are notoriously expensive), yet they still need to reach out to and captivate an audience. Not only do startup businesses need to reach an audience, they have to attract, retain and stimulate value from said audience. Growth hackers are involved in every step of new product development, from inception, to design (especially for service products), to promotion and they use a variety of different tools and techniques to achieve rapid, affordable and scalable growth.
How Growth Hackers Do Their Thing
Much like the technology they immerse themselves in, a growth hacker’s toolbox is constantly changing. What may work for a growth hacker one day may get patched or become irrelevant in a day or so. Growth hackers are constantly testing new ways to achieve scalable and sustainable growth. While there is a lot of creativity involved in a growth hacker’s decision to implement a new growth strategy, growth hackers are analytics-obessesive and they almost have quantified reason behind their decisions. It is also important to note that a growth hacker never employs only one growth technique. A successful growth hack utilizes many, many growth tactics. KISSmetrics offers up 6 growth hacks that are commonly used to acquire new customers for practically no cost.
Simply by reducing the time it takes for web pages to load, growth hackers can increase conversions by 15-21%. With just one growth hack, that’s a 15% increase in your customer growth this year. Ideally, you want a page load time of under 2 seconds. READ: Moz’s 15 Tips to Speed Up Your Website.
If you have a blank spot on your site and you’re not sure what to do with it, use some social proof. Not only do we look to others for help, we also look to them for reassurance. When we see people taking the same action we have, it calms our fears and tells us that we’re going in the right direction. Some commonly used examples of social proof include testimonials, incorporating the logos of your biggest clients or biggest media sources who have mentioned your product on your website, customer statistics (like publicly displaying your brand’s social followers) and more in-depth case studies.
On-ramp programs are all about how you treat your new customers or users. You only have one shot to turn a new customer into a loyal fan. This is where, NUX – which stands for new user experience and is a common tool in growth hacking – comes in. Some best practices for NUX include constructing an effective email drip campaign, so that whenever someone gives you their email, you have a series of emails that are sent to them on a predefined schedule. We call it a drip campaign because the emails consistently drip to your customers one at a time. According to KISSmetrics, a popular model is to use a 3:1 ratio between valuable content and other offers. In other words, try sending three emails right after someone becomes a customer that helps them solve their problems. On the 4th email, provide an offer for another product of yours.
Barebones Home Pages:
A lot of company’s use their home page as a space to post as much information about the business or product as possible and to direct visitors to every other area of the website. This creates a lot of homepage clutter that can distract and potentially repel new visitors. That is why it is important to go bare bones on your home page. Cut it down to the essential elements. This includes one headline to describe your value proposition and a call to action. Some other good examples of simple home pages designed with growth hacking in mind are Twitter, Facebook and Quora.
Here’s a crazy thought: other businesses have worked really hard to establish a large audience, so why should you have to? Product integration is essentially piggybacking off other business’s and product’s customer bases. Think of the mutually beneficial marketing dynamics between PayPal and Ebay. Another example of product integration is Spotify, which was one of the first products to integrate with Facebook. Now it is near impossible to find a B2C mobile app or software that doesn’t offer some sort of social integration. By aligning yourself with other entities with established audiences, you can siphon from that audience while contributing new users to the integrated business or service. It’s a growth hacking win-win.
This is the driving factor behind the most successful growth hacks. Most marketers create a product and then try to make it viral. This is almost impossible to do. Growth hackers build virality into the product itself. A viral loop means that if you start with 10 customers, they’ll bring more than 10 other customers to you. Each batch of new customers gets larger and larger as you go viral. Let’s use Dropbox as an example. The cloud storage service provider gives you 2gb’s of free storage when you sign up, but will grant you additional storage if you refer a friend to Dropbox who signs up as a new user. The viral nature of Dropbox is built into the product itself. Perhaps that’s part of the reason why the service has amassed over 200 million users since 2007.
“If your product involves sharing at its core, virality will matter and you should focus on optimizing it. Not just optimizing, encouraging it.”
– LinkedIn Growth Hacker Ivan Kirgin
How Growth Hacking Differs From Inbound and Traditional Marketing
Growth hacking’s biggest point of difference is its focus. Inbound and traditional marketing can focus on many different objectives, from increasing brand awareness to stimulating more frequent repurchases. Growth hacking, however, focuses on one aspect – growth – and how to go about it in a sustainable and affordable way while increasing the customers’ lifetime value. Growth hacking tends to be more technical than traditional and inbound marketing and require a more precise set of skills and knowledge, yet it is substantially cheaper to implement than traditional marketing. From Ryan Holiday at Mashable:
“Instead of chasing vague notions like branding or awareness, a growth hacker drives users and clients. Instead of spending money, growth hackers look for scalable growth from viral factors and social sharing.”