fbpx
BlackSheeplogo

What is Growth Hacking?

Today, the digital world is a battleground on which marketers are fighting to achieve competitive advantage. A conventional approach is no longer enough, the only way to survive is to adapt.
Nowadays, there is a lot of buzz around the term “Growth Hacking”. Some people think it could be the answer to help every company, others says it’s bullshit.
For sure, growth hacking is a controversial concept, quite misunderstood. Let’s start at the beginning…

History of growth hacking

The term “growth hacking” was coined by Sean Ellis in 2010. In one of his blog post, he defined a growth hacker as “a person whose true north is growth. Everything they do is scrutinized by its potential impact on scalable growth”.
Andrew Chen introduced the term to a wider audience in a blog post, he wrote that growth hackers “are a hybrid of marketer and coder, one who looks at the traditional question of ‘How do I get customers for my product?’ and answers with A/B tests, landing pages, viral factor, email deliverability, and Open Graph”.
In 2012, Aaron Ginn defined a growth hacker on TechCrunch as a “mindset of data, creativity, and curiosity”.

DNA of a growth hacker

A growth hacker is not a replacement for a marketer. And a growth hacker is not better than a marketer. A growth hacker is just different. While traditional marketers have a broad focus ranging from building out a marketing team to defining an overall marketing strategy, the heart of a growth hacker is the relentless focus on growth. Growth is his or her North Star. Every decision he/she makes is driven by growth. Every strategy he/she executes, every tool he/she implements and every technique he/she develops should be drive by the desire for growth.
Growth is the only metric that truly matters.

So, what does it actually take to become a growth hacker?
For me, a growth hacker is a person who:

  • is data-driven and kind of a data-geek, he/she clearly understand data, analytics, metrics and statistics
  • understand human needs and psychology
  • is willing to learn and has a discipline approach to follow a process
  • has a startup mindset
  • is performance and results-oriented
  • is curious, creative and a problem solver
  • is relentless in pursuit of growth.

Growth hacking in short

Growth hacking is a process of rapid experimentation across marketing channels and product development to determine the best practices for growing a business. Principally, growth hacking works best when experiments can provide rapid feedback, for instance testing marketing messages, watching how people react to new products or prototypes. So, while it’s not exclusive to, it’s most suited in digital businesses.
Do you want to increase the number of people responding to an ad? Do you want to make people stay longer on your website? Do you want people to buy the item you want from your e-commerce? If your goal is growth, growth hacking is the right path for you.

GROWTH HACKING IS NOT MAGIC, IT’S A STEP-BY-STEP PROCESS

As I’ve said, growth hackers are obsessed with strategies that build business. They typically set priorities for customer acquisition and scaling the business, and developing, implement and test ideas to help them achieve their goals. And they focus on “pirate metrics”.
Pirate metrics is a helpful customer-lifecycle framework invented by Dave McClure, an angel investor and entrepreneur, and is a linear process known as a growth funnel. A growth funnel is a five-stage process called AARRR, an acronym for Acquisition, Activation, Retention, Referral and Revenue. The process focuses on each step required for a growing business.
Finding the right direction for a business can be difficult. Thankfully, this framework is a simple, easy to understand and implement growth model. Using the five stages of AARRR, a business can solve problems, prevent issues and become actionable within their market.

  1. Acquisition: How you get people to know you by name? This is the very first step. The one where you get people to your website and maybe signup for your product/service. Consumers become aware of your solution and give up information (for example their email).
  2. Activation: How to give users a happy first experience? It is not enough to get people to download your app/software and/or even sign up, if they are going to stop using it right after. That’s why it’s crucial to get your user to the “Aha Moment”, which is the first time the user realizes the real value in your product, as quickly as possible so that he/she keeps coming back.
  3. Retention: How you keep them coming back for more? Retention means people regularly come back to use your product. For an e-commerce business that means someone not only buys from you once but multiple times. For an app, that means that users keep coming back and opening / using the app. For a SaaS business, that means that people who are subscribed to your software keep using it (often) and stay subscribed.
  4. Revenue: How you monetize them? No matter what anyone tells you, revenue and figuring out a monetization plan is important for any. This is basically counting the number of customer that you have.
  5. Referral: How you get them to tell other people? The absolute best way to drive growth is through referral. If you can easily get people to talk about your product and to refer some of their peers, it’s a big win.

Some people think Awareness is the very first step of a growth process. Others, don’t even include it in the funnel. For me, this part talks about the brand awareness. It focuses on how to gain maximum awareness in a cost-effective way and a short period of time.

I’m going to better explain the growth hacking funnel in one of my next blog articles.

WHAT DOES GROWTH HACKING LOOK LIKE?

Up until now we’ve been talking very philosophically about growth hacking. We went through its history, its definition, what does it take to become a growth hacker and the growth funnel.
Here a case study to better understand the process.

At the beginning, AirBnB almost didn’t succeed.
Now, worth $10 billion and responsible for more stays than anyone else in the hospitality industry, this company has seen themselves through tough times to sit on the top of an industry in record time.
How did a few air mattresses on the floor of a San Francisco loft become the most widely-used anecdote for startup growth hacking?

The story. In 2007, designers Brian Chesky and Joe Gebbia couldn’t afford the rent on their San Francisco apartment. To make ends meet, they decided to turn their loft into a lodging space and they create their own website. There was a design conference coming to town and hotel space was limited, so they set up a simple website with pictures of their loft-turned-lodging space – complete with three air mattresses on the floor and the promise of a home-cooked breakfast in the morning. This site got them their first three renters, each one paying $80, and after that first weekend they began receiving emails from people around the world asking when the site would be available for destinations like Buenos Aires, London, and Japan.

The early growth. At the beginning, the founders needed a way to raise money. They bought a ton of cereal and designed special edition election-themed boxes (Obama-O’s and Cap’n MCcain’s), which they sold at convention parties for $40 a box. They sold 500 boxes of each cereal, helping them to raise around $30k.

The traction. AirBnB knew they had a service that people wanted but knew that in order to succeed they’d need to reach a large audience to build their marketplace quickly and cheaply. Going the traditional marketing route of buying ad space would’ve bankrupted the company while trying to compete in an ultra-competitive travel space. But the creators knew there was a better way–why not draft off a platform that was already facilitating similar transactions, but fell woefully short on the experience? Enter Craigslist. Craigslist is an American classified advertisements website with sections devoted to jobs, housing, personals, for sale, items wanted, services, community, gigs, resumes, and discussion forums. AirBnB executed a hack to cross-post an AirBnB listing on Craigslist as well. All of a sudden, any user searching Craigslist for vacation rentals is running into a slew of professional listings with AirBnB’s name, inviting clients to click on over. AirBnB also used an email campaign to inform posters of vacation rentals on Craigslist how easy it was to post on AirBnB too. Why post on one platform when you can post on two for about the same effort? This got AirBnB the initial traction they needed, without dropping a dime on ads.

The perfect experience. Early on, too many properties were struggling with revenue. The problem was traced to bad pictures which created less interest. The solution was low tech but effective: renting an expensive camera, going door to door and taking high quality photos of every property in New York. The income doubled and eventually became an expensive (yet effective) program. AirBnB now employees 2000 freelance photographers and revenue has hit exponential growth since the program’s introduction.

Removing fear. There are obvious concerns when renting your home to strangers (and vice versa). The company realized that removing fears of those who were interested in using AirBnB (yet hadn’t rented or listed) was a crucial element of growth. Introducing social integration allowed visitors to see connections and social proof of those who had stayed in a particular location.

Going worldwide. With so many beautiful locations around the world, AirBnB has started to see another round of huge growth from international stays. This outlet will also be a focus for continued increase in the coming years.

THE FUTURE OF GROWTH HACKING

Growth hacking isn’t a fixed strategy. It’s a mindset.
For now, growth hacking is relegated to startups. Startups generally lack resources, and the established relationships, that would allow them to be effective with the tactics of a traditional marketer, so they are somewhat forced to growth hack. However, there is nothing about growth hacking that cannot be applied to larger corporations. If growth hacking can work without resources, imagine what it can accomplish with resources.

What are your thoughts on growth hacking? Is something you are not mindful of, or incorporate into your digital strategy?
Please share your thoughts, tips, questions and growth hacks in the comments 😉

Flavia Piantino Gazzano
flavia.gazzano@gmail.com

Digital enthusiast and growth hacker, with a strong passion for new technologies, social media and PR. She uses strategic communication as a strong asset in her life and has a creative approach to problem solving.

No Comments

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

SHARING
is
CARING

Share on facebook
Share on linkedin
Share on twitter
Share on pinterest
Share on whatsapp
Share on email

SHARING
is
CARING

Share on facebook
Share on linkedin
Share on twitter
Share on pinterest
Share on whatsapp
Share on email