Once upon a time, in a simpler world, marketers lived a good, easy life. There were a handful of television channels, magazines, and radio stations that serviced a huge percentage of the population and all a marketer had to do was create a strong message or compelling story to sell their products or services.
Oh, simpler times! Now there are thousands of fragmented markets, each serviced by a particular bevy of publications, mobile apps, web sites, TV channels, and online communities. Good luck developing a “one-size-fits-all” marketing strategy in 2013. Today’s buzzwords are “immersion,” “personalization,” “experience,” and “content,” all because of the advent of growth hacking. Below is a list of four ways growth hacking changed marketing forever:
Growth over budgets
The best growth hackers founded lean little startups while living in a friend’s garage and eating Top Ramen for lunch every day. They didn’t havea marketing budget, but they developed their product with a head for marketing. The origins of growth hacking were humble and developed out of necessity. What this means for you is that you need to focus on arbitrage, not a budget. Part of your job is to make acquisition (at the top of the funnel) as low-cost as possible, which can be achieved with both paid and free channels. Most industries require a mixture of both; however, capitalizing on the growth generated from your free channels will help maximize your returns from paid acquisition channels in the long run.
Viral is everything
Good luck coming up with the next “viral” hit! You can create conditions in which something potentially viral has the best chance of going fully viral. This means building viral capability and sharing right into the product itself, then testing, retesting and retooling until you’ve got a design that maximizes its potential virality, that is, the best way to get your users to share it with others. The goal of a growth hacker is to reach a viral coefficient greater than 1. This means that for every person that uses the product, more than one other person hears about it. Even if you can’t get all the way to 1, you can still raise your coefficient from say, 0.3 to 0.6, which would be a victory in itself.
Marketing is dead. Long live marketing!
To some folks, growth hacking is an entirely new discipline. For others, it’s just a fancy new name for online marketing. But one thing that can’t be denied is growth hacking’s ultimate focus on the marketing aspect. Growth is plain impossible without some form of marketing because marketing is the primary agent of growth. However, a growth hacker knows that traditional marketing channels are no longer effective, so they’ve gone interdisciplinary in their search to find a killer advantage; the thing that will give them a leg up on their competitors. What this means is in order to achieve exponential growth, you’re going to have to skip the low-hanging fruit.
Marketing is part of a holistic operation.
Today, most companies have separate marketing, product and development divisions, but growth hackers are slowly changing this. By locating the focus of their marketing-driven growth efforts in the product division, they’re building something from the inside out with integrated tools capable of achieving scale at an outrageous level. Think about it: companies used to hire engineers to come up with ideas, then build a prototype and give it to the marketing department and tell them to figure out a way to sell it. Growth hackers incorporate a marketing aspect into the product itself so that consumers can easily sell it to their friends, family, and professional network. Growth hackers have shown the world that the marketing element needs to be baked right into the first prototype.
Growth Hacking is not a Marketing Strategy
Growth hacking can be a fun topic of conversation, but when speaking to someone about growth hacking techniques or just in general, there is one point that is always brought up that I always disagree with: the notion that growth hacking is a marketing strategy. To begin with, it’s not marketing. Marketing drives growth hacking.
The concept of virality is central to the premise of growth hacking. It must be built into the product during the development phase; it’s not something you can tack on after the product is complete. This is why a marketer isn’t a growth hacker and vice versa. Traditional marketing sells an existing product; growth hacking creates a product that will market itself.
Growth hacking is not only changing the world of marketing, it’s also changing the world of product design and development—the core of growth hacking. To further convince you, here are four reasons why growth hacking isn’t a marketing strategy:
Growth must be the top priority of the company
It’s not enough for a company to simply place growth in its portfolio of goals. Growth must be the one element that unifies all company objectives. If a product feature or user design experience isn’t achieving virality, it’s wrong, plain and simple. In the old days, the product team would come up with something, and the marketing team had to figure out how to sell it to the public, either by educating them or using old-fashioned marketing magic to create demand. In the age of the growth hacker, the product team and marketing team work together. Growth hackers might be in the business of marketing, but they’re also present at every single product development meeting to make sure that the right elements are built in from day one. You have to be proactive to achieve growth—no one ever saw their company explode while resting on their laurels, no matter how awesome their product might be.
Growth hacking is interdisciplinary
We’ve covered this before, but it bears repeating. Marketing is primarily focused on growth, and the product is partially focused on growth, but only the growth hacker has the chops and the obsessive, single-minded preoccupation to consistently push the metrics up and to the right. Growth hacking doesn’t apply a set of cookie cutter tools or principles into a marketing strategy; it’s a stand-alone entity that requires more than direct marketing techniques, quantitative analysis, and zeroing in on distribution and user engagement. You need to simultaneously achieve all the goals set for your business with a single product—that is, develop a product that’s fully optimized for each stage of the funnel—in order to move beyond marketing and into growth hacking.
Marketing targets the top of the funnel
We started talking about this in the last bullet point, but let’s get into some details, shall we? Unlike a marketer, a growth hacker follows a customer all the way down the funnel. A marketer’s job is to get people to use the site or create an account, while a growth hacker’s job is to bring them all the way through the narrower parts of the funnel to the point where they refer the product to their friends and start paying for the service. In particular, a growth hacker’s sweet spot in the funnel is user retention. This is the channel that is least saturated and the key to maximizing returns both up and down the funnel. As more people become regular users of a product, the easier it is to achieve activation and acquisition. Similarly, with a large user base, it’s a lot simpler and more effective to tweak the product to make it easier for users to refer others. And once the product or service reaches a significant portion of the population, the lotus opens up and the jewel in the middle becomes your company’s revenue stream.
Growth hacking research and development is completely different than marketing research and development
As a growth hacker, you’re not just figuring out new ways to direct people to your landing page; you must also guide the efforts of the product development team in order to maximize your user base. Where a marketing strategy might test, experiment, and retool a particular strategy for a static product, a growth hacker might send an entire web site back to the drawing board if it isn’t properly primed for a viral coefficient greater than 1.
Common Myths of Growth Hacking
If you own an online business, you’ve probably heard a lot of boilerplate tripe about how to increase your client base. Most of the growth hacking advice out there is the same old marketing copy drag dressed up to look shiny and new. If you search for specific answers, you’ll most likely get platitudes and vague generalizations because increasing your user base depends on numerous factors that aren’t easy to control and that change from business to business. These people have no interest in teaching you how to become a growth hacker—they just want you to come to their page so they can sell more ads.
Hey, folks, the emperor has no clothes. There are a lot of myths and legends swirling around about growth hacking, and we’re going to put them to rest, once and for all.
If you’re a business providing real value and there’s a viable market for your product or service, you should be able to use growth hacking to continually expand your user base and increase growth year after year. The old saying in marketing goes, “It’s easier to go where your customers are than to get them to come to you.” And that’s also true of growth hacking (at least in the beginning). As long as you’re current with Internet trends, users’ level of sophistication and evolving expectations, if you apply certain principles and take specific steps, you should be able to growth-hack your way to new business. That is, if you don’t fall prey to the myths and falsehoods being spread around the Internet by unscrupulous dark-arts marketers. Here are the three most ludicrous myths about growth hacking we’ve seen out there thus far:
Growth hacking is a quick, easy fix for a struggling company
Come on, people. There’s nothing quick or easy about growth hacking, just like there’s nothing quick or easy about marketing or product development. In fact, growth hacking is more difficult and complicated because it encompasses both marketing and product development. This doesn’t mean that a properly designed product with built-in virality won’t attain hockey-stick growth if you’ve got a wiz growth hacker at the helm, but don’t think for a minute that if your company is struggling, all you have to do to turn the ship around is hire a growth hacker. If your product doesn’t have good viral potential to begin with, it’ll need to be completely redesigned from the ground up. And not everything goes viral, so not every company can benefit from growth hacking. You must incorporate rapid scalability into the concept of the product. A web site, for instance, can benefit from growth hacking. A mom and pop coffee shop? Not so much.
Growth hacking is a brand new discipline
Only if you think the Internet is a brand new phenomenon. Well, okay, the Internet and the web are a little older than growth hacking, but not by much. Companies like Facebook and LinkedIn have been using techniques now called growth hacking long before the concept was a glint in Andrew Chen’s eye, and memes were going viral the minute the Internet was introduced to cats (meow!). Since then, people have been trying to figure out how to replicate that virality. Just because we’ve got fancy new terms for these things doesn’t mean they’re new; most of these concepts are older than your high school-aged kids.
You have to be a programmer to be a growth hacker
Partially false! This is where people get tripped up on the “hacker” part of growth hacker. We’re not talking the 1990’s movie with Angelina Jolie; we’re talking the 1980’s TV show MacGyver. It helps to be a programmer, especially if you’re working with a business that’s primarily online, but you don’t need specialized technical knowledge to guide a development team’s efforts to build virality into a product. The whole key to hacking growth is to find previously undiscovered distribution advantages that your company can leverage. And while it’s no surprise that most of the original growth hackers have backgrounds in engineering, as they’re the ones directing product development, it’s no longer the case that you have to be a coder in order to hack your company’s growth. All you need is a good command of the basic principles and a willingness to commit to a strategy that prioritizes growth in all aspects of the business.
This article was an excerpt from “Growth Hacking – A How To Guide On Becoming A Growth Hacker” By Jose & Joe Casanova.