Ever since Sean Ellis coined the term “Growth Hacker” back in 2010 the concept of growth hacking has become an important buzzword in the domain of digital marketing and startup growth strategies.
Few ideas are as revolutionary and divisive at the same time. Or as misunderstood. What is it exactly? Marketing in disguise? Science? Or just a cool catchphrase to help people create jobs for themselves and earn better salaries?
For the time being growth hacking is mainly confined to the startup world. This is because startups simply do not have the resources or the contacts to reap the benefits from “traditional” marketing tactics. But now, growth hacking is increasingly finding its way into Fortune 500 companies. The reasons are clear. It works pretty damn well.
The birth of growth hacking
A quick look on google using related keywords is enough to show how interest on the topic has, well, grown! There’s also a pile of books on the topic put together by various marketing and non-marketing specialists. A quick browse on amazon will bring you up several pages of results.
But, as with any kind of trend, there is a lot of noise and one needs to separate the wheat from the chaff. So let’s have a look at some definitions. More than that, let’s explore whether you should implement growth hacking in you company. And find out when and how should you start.
What is growth hacking (and more importantly what it isn’t)
In short, this is the simplest definition:
“A growth hacker is a person whose true north is growth.” – Sean Ellis
And now, the tl;dr edition:
Growth hacking is not about:
- Finding shortcuts or “cheats” that will get you an increase of 1000% to a chosen metric. There is a big misconception surrounding the word hacker. In its original meaning a hacker is: “any skilled computer expert that uses their technical knowledge to overcome a problem.” The popular, and dare I say wrong view of a hacker is that of a security hacker. Someone who, based on the above definition, is an expert that uses technical knowledge to overcome and/or circumvent computer security measures, protocols and so on.
So, let’s state it one more time, growth hacking is not about finding a quick fix or in some way “cheating the system” that would cause an increase in whatever metrics you are tracking. Which brings us to the next question.
What is it about?
In a nutshell, growth hacking is about discovering and inventing scalable, repeatable ways to grow your business. But that’s a lot of jargon right there, so let’s break it down a bit:
- Scalability Vs Growth: different things, so scalable growth → growth achieved with little or only incremental resources compared to value of result
– Growth= adding resources at the same rate that you’re adding revenue
– Scalability = the capability to cope under conditions of sustained high demand
– So, it is not simple burning cash/resources to get customers
- What constitutes growth – type of business, the stage the business is at
- Data-informed/repeatable solutions, not just a lucky stab in the dark
- Measurable & meaningful
– Measurable and verifiable result of a growth hack
– “Controlled experiments”: is the growth hack solely responsible for a growth result or several other factors contributed?
Growth hacking is predicated on the idea of experimentation. Or if you will, it is an adaptation of a scientific approach to the question “how do we grow business X”. Therefore, we can break it down to 3 distinct steps:
- Document your hypothesis: list your best ideas and strategies that can help you grow your business. These can be almost literally anything. From marketing campaigns to a new feature in your product, to changes to a landing page or targeting a new customer segment.
- Design your experiment: think about each of the ideas you formulated above and formulate a way you can test it. Here you need to articulate your experiment fully. For example, what is the test you will run, and what conditions need to be meet? What will you be measuring and how? For how long does it need to run, what conditions (if any) will invalidate the process? And so on.
- Assess your results: do a thorough evaluation of the results of your tests so you can analyse in detail.
Growth hacking and the Starttech Ventures “Venture Building” model
If you have made it this far, congratulations!
Possibly, you are wondering how growth hacking is connected to startups and in particularly to our Venture Building model. At Starttech Ventures, we are great proponents of the Lean Startup methodology, the core principle of which is the Build-Measure-Learn loop. This loop fits perfectly with the process we described earlier for growth hacking.
I will spare you the nitty gritty details and simply state that Lean methodology and growth hacking create a great virtuous circle, which can also be combined with an agile software development framework, e.g. scrum, for a complete and holistic approach that combines product, customer and business development. These concepts are at the center of our approach in building and growing each startup we bring into our portfolio via our long-term Venture Building program.
Is it time for growth hacking yet?
As a general rule, growth hacking is an inter-disciplinary process that, ideally, involves people from all parts of the business. From sales and marketing, to computer programming, data science and product development, and everything in between.
However, that doesn’t mean you can’t start with a small team, even a team of one. But, there are a few criteria that need to be met if growth hacking is to work for you and produce the best results possible:
- A must-have product. This is the baseline requirement. As Sean Ellis puts it, in order to start your hi-tempo growth efforts you need a must-have product. A nice-to-have is simply not enough. Practically this should coincide with achieving product-market fit.
- Accountability. Being responsible for growth means exactly that. You have to take that responsibility and fully embrace it. However, for that to work properly we need #3.
- Freedom to experiment and act. Your growth hacking unit needs sufficient freedom to continuously test new ideas. In addition, it will need access to resources from product development to sales and the freedom to work across departments
The list of course can go on and on, but these three are your growth hacking must-haves. I would go as far as to say that you should not try growth hacking if you cannot satisfy the three criteria above.
Happy growth hacking!
Further reading and resources
New to growth hacking? Here is a list of resources to get you started:
- Growth Hacker Marketing: A Primer on the Future of PR, Marketing, and Advertising, by Ryan Holiday: A great book to get you started, short and to the point
- Hacking Growth by Sean Ellis: This is from the guy that coined the term, need we say more?
- The Growth Hacker’s Guide to the Galaxy, By Mark Hayes: jam-packed with tactics and hacks to use