Click here to get this post in PDF
Growth hacking may sound intimidating for those new to the term, but it is less about breaking into computers and more about achieving exponential profits and scale for your business. Sounds good? Here is what growth hacking is really about and how you can start your first growth hacking experiment.
What is Growth Hacking?
Growth hacking is a relatively new marketing term (from 2010) that is used to describe how a business can grow quickly through the implementation of innovative tactics. Data and experimentation are the foundation of growth hacking. In addition, growth hackers look at how to maximize the potential of specific metrics across the entire AARRR sales funnel. AARRR stands for acquisition, activation, retention, referrals, and revenue.
Traditional marketing efforts often focus on the acquisition (also known as awareness) stage of the sales funnel. This is because many businesses think that their products or services will sell themselves once they catch the attention of prospects. However, this is seldom the truth. Customers need gentle pushes to drive them down the sales funnel. Growth hacking is not just concerned with leads but reducing churn and increasing conversions.
After activation comes retention and referrals. Despite the lower cost of working with existing customers, many businesses focus too much on acquiring new ones. Retention is how you persuade existing customers to continue purchasing your products or services. Referrals are about building customer loyalty and turning your customers into brand advocates that help to drive organic growth. Finally, revenue is where you not only sell basic offerings to your customers but upsell them to more profit-generating products or services.
By having a holistic view of the sales funnel, growth hackers can find more unique growth opportunities and come up with unprecedented marketing strategies. Supported by thorough research and experimentation, growth hackers can trial innovative ideas to create new strategies that help their business achieve rapid growth.
How to Start Growth Hacking
1. Create a Desirable Product
Before the Internet, when consumers had limited choices, it was probably possible to create an average product and simply market it into stardom. Today, businesses must ensure that they have a product or service that people love. No amount of growth hacking will work for a weak primary offering. Once you have a winning offering, identify the one core metric that affects profitability and determines your success. For example, the number of users or the quantity of sales. Everything that you do from here on will be centered around improving your core metric to drive growth.
2. Understand Your Audience
Before everyone had an Apple iPhone, a small percentage of trailblazers decided to try it first. Likewise, no matter how much you want all consumers to desire your product or service, you will first need to impress the innovators and early adopters. This theory is known as the diffusion of innovations. What this means for a business is that you should target the small minority (15 percent) of people who will love your product the most. You must understand their demographics, interests, behaviors, and needs to a fine grain. Then, you can create ideal customer personas as a marketing guideline.
3. Come Up With Creative Ideas
Possibly the most important stage of the growth hacking process, ideation is when your team comes together to come up with creative ideas that may fuel your growth. Any and all stages of the sales funnel are open to hacking, so do not feel like you have to only think about acquisition or activation. The purpose of this exercise is to come up with as many ideas as possible. Once you have a great list of prospective growth hacks, prioritize them in terms of confidence, potential impact, and ease of implementation.
4. Test and Experiment
The most fun part comes next: testing. Although growth hacking can bring sudden, exponential growth, rushing into every new idea is a formula for failure and customer confusion. Start with small experiments on the growth idea with the highest priority and see if it advances your metrics. If it does, add more incremental improvements. Explore a variety of marketing techniques and content formats to see what your audience responds to the best. You can gather data with growth hacking tools to compare and contrast the different approaches.
5. Analyze and Measure
Not all your experiments will succeed. Chances are most of them will fail. Regardless, you should keep track of the details of every test to analyze the results and learn what does and does not work. If there are successful tests, analyze your data and try to achieve better results in the next test cycle. Have you managed to improve your core metric and reach or engage more of your ideal audience? Are your efforts scalable? Measure your results and repeat your growth hacking cycle.
If you want to accelerate growth, you need to expand your mindset. Growth hacking can help your business to unlock growth opportunities and break stagnation. It combines creative ideation with the scientific method to find genuine ways to rapidly scale your business. Try growth hacking on your business to see what benefits it can bring you.
You may also like: Top 8 Email Marketing Tips for Growth Hacking
Image source: Unsplash.com