When we here about the word hacker or hacking, what comes to our mind are computer geeks relentlessly typing on their keyboards trying to break into the system of a bank or trying to steal information. That is what the movies or TV shows tell us, in reality it’s much less of a fanfare than that. But what we are going to talk about here is not about computer hacking, it’s a different type of hacking and a good one – not that all hackers are bad – and it’s called growth hacking.
What is growth hacking?
Growth Hacking is a relatively new term, some thinks it’s a marketing disguise or some sort of buzz phrase just to create jobs or increase salaries. It is often misunderstood but for us to better understand it we need to trace back its history of how it came to a start.
The term “growth hacker” was first coined by Sean Ellis in 2010. Ellis had helped a lot of companies achieve growth, he is the guy whom internet companies even those in Silicon Valley seek help when they want to increase their user base. He has worked with giant companies like Facebook, Uber, Dropbox, and many more.
He would set up systems, processes and mindsets, which helps a company grow and can still be maintained even when he left. He would hand over the responsibility for the growth machine to another, and this is where problems began.
The search for his replacement would be the problem, although he would receive legit resumes, they are not relevant to the job. Often, applicants have their marketing degrees and marketing experience, but something is still missing. Ellis knew that the type of strategies he is using are not on the playbook of traditional marketers, and handing them over the responsibility will not be helpful at all. This is where the idea of “growth hackers” is born.
Ellis defines a growth hacker as “a person whose true north is growth. Everything they do is scrutinized by its potential impact on scalable growth”. There had also been other definitions given for growth hacker, for instance, Andrew Chen in his article “Growth Hacker is the new VP Marketing” 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”.
Others like Aaron Ginn of TechCrunch defines growth hacker as “a mindset of data, creativity and curiosity”. Similarly, Richardsen and Fong in their book “Growth Hacking” defined growth hacker “a highly resourceful and creative marketer, singularly focused on high leverage growth.”
All these definitions can lead us to the conclusion that growth hacking is the process of creatively innovating ways or system based on data which can lead to a scalable growth for a company. Growth hackers uses software, API’s, databases, and related tools to grow a company. Growth hacking is outside-the-box marketing to get maximum amount of users with minimal expenditure.
Difference between growth hacking and marketing
While there are many who argues that growth hacking is just a form of marketing, there is actually a fine line that borders the two concept in many terms. Although they seem to be similar in some aspects, there are areas that growth hackers focus on that marketers don’t, the same way marketers have some area of focus that growth hackers doesn’t have. As a matter of fact, the only similarity a growth hacker and a marketer have is the niche their working on and their goals.
A growth hacker is certainly not a replacement for a marketer. They may have some similarities but they have different challenges to take on and tools to work with. A traditional marketer covers a very broad focus, a growth hacker on the other hand is more specific. To better understand these differences, let us break them down to categories.
Traditional marketers are data-informed, they lean more on the traditional side in finding growth solutions, and they have a more economic or business related background.
Growth hackers on the other hand are more data driven, meaning, they base their decisions on the metrics they can measure. They are more analytical than their marketing counterparts and generally have a more technical background.
Marketers focus more on how to make people want the product by creating product awareness, and hiring sales people to push the product. They focus on acquisition and the activation throughout the whole lifecycle of a product.
Growth hackers focus on how to make products or services people would want at the same time they focus on retention and product validation. They concentrate on different metrics based on the stage and level of validation of the product before proceeding to acquisition and referrals.
3.) Platform or Channel
Marketers generally rely on paid advertisements through various media channels, either digital such as social media, television, email, or non-digital such as billboards, magazine, ads, and newspaper ads.
Growth hackers on contrary generally relies on free or low cost alternatives. One example using the product itself as a distribution channel – this technique is the one used by Dropbox, they give free extra storage to the user for every friend of theirs who signs up. Another one is by technology-based solution, the same one used by AirBnB who reversed engineered Craiglist, so that their users can post ad listings on to Craiglist.
Marketers have no well-defined funnel or stages in executing their strategies. They can do things while doing another, or even if the other is not yet done.
Growth hackers have clearly defined funnels or stages in executing their strategies. They need to accomplish a prior step before they can move on to the other. For example, they need to define their goals and actions before they can gather feedback and hypothesize. Next, they would set in place an analytics to track their goal, and then they will execute experiment by executing the simplest solution and lastly, they would optimize the experiment (A/B test).
In addition growth hackers propel growth via user-focused design, exploiting growth surfaces, and refinement of product experience. It is more about virality from users as well as their engagement to the product.
Myths about growth hacking
When growth hacking began, it was thought that it would just remain in the territory of Silicon Valley insiders. But it turned to blow up when the success of early adaptors like Facebook became apparent. It became a booming trend and cause paradigms to shift.
However, this popularity also spawned a number of myths regarding growth hacking. Some of this myths are product of subjective observer bias, misinformation and misapprehensions. These myths could twits perceptions of some people regarding growth hacking. These myths can reduce an effective methodology such as growth hacking into just another fad.
Here are some myths revolving around growth hacking and the truth behind them;
1.) Myth: Growth hacking is synonymous to marketing.
Truth: Growth hacking is about growth through product engagement and it is clearly not marketing.
In some ways, growth hacking can address marketing goals however it is not propelled by marketing strategy. As thoroughly discussed above, the difference of marketers and growth hackers have a clear fine line bordering them.
2.) Myth: Growth hacking should be done immediately by startups.
Truth: You need to be ready before you hack growth.
This is the one of the most common myth people have according to Nichole DeMere of Inturact. She emphasized that a company needs to have identified ideal customers, conducted customer development, and established a product-market fit among others before employing a growth hacking strategy.
It is best done during the early stages of product development because growth should be built into the product itself to ensure maximum return of investment.
3.) Myth: Growth hacking is expensive.
Image from TravelPerk
Truth: It is more cost-effective and more cost-efficient.
Startup businesses are the main followers of growth hackers for a particular reason, it doesn’t require a huge budget.
4.) Myth: Growth hacker is just the same as coders.
Truth: They do understand code, but they do much more than that.
As what Andrew Chen said, growth hackers are combination of coders and marketers. Growth hackers should be able to work together with other teams in the company such as the marketing team, product management team, and even with the software engineering team. This ability to cross boundaries and do cross-functional work is the defining attribute of growth hackers.
5.) Myth: Growth hacking is only for startups.
Truth: It can be vital and helpful for any company in any sector
Although it is true that growth hacking would benefit startup companies the most, it does not mean that established companies cannot employ and benefit from it. In business, it is either you grow or you die. Evidently, many companies that are past their startup stage still have a dedicated growth teams.
Why hire a chief growth hacker
Growth is the make-or-break metric for any starting company, the long term success of a company will greatly depend on how it will perform in the beginning. And this is the metric that growth hackers only care about. This is the reason why startup companies are the main followers or seekers of growth hackers.
In the beginning or starting phase of companies, they would not need someone to “establish a strategic marketing plan to achieve corporate objectives”, or someone to “build and manage a marketing team” and “manage outside vendors”. What they need is someone to make their company and product known and increase their use base. In short, start-up companies first need growth before heading over to extensive marketing.
So why should you hire a growth hacker?
- Cost effective – Startup companies don’t have a lot of budget, they can’t afford to splurge money on expensive billboard and television ads. Growth hackers substitute these traditional practices with more cost-effective and efficient strategies.
- Innovative – hiring a growth hacker would open up your business strategies to new innovations that others have not employed before. This innovations could help your business grow more.
- Continuous product improvement – growth hackers help in the retention of customers by creating or improving existing products that would keep them coming back again and again. This is the reason why Facebook discusses for hours about what fonts or colors to change within their interface, and they do include the growth hacking team in things like this.
If you are still not convinced, let’s take a look at these companies who successfully made use of growth hacking in expanding their business.
AirBnB’s success story on growth hacking is one of the most popular in the industry. The integration of the ability to post rental ads on Craiglist is the one responsible for this success. Although some might argue that cross-posting as a form of marketing has long been existing ever since the days of newsgroups and forums.
But what AirBnB did was not a marketing campaign. They did not used Craiglist to advertise or promote their product, instead it was a product-focused move. This move according to experts is not something traditional marketers would have come up with.
With its huge success and widespread popularity, tons of books, articles, documentaries, and movies have covered how Facebook came to flourish. But what most missed is how it made use of growth hacking to increase its user base.
Years ago, Facebook introduced a new feature where users could embed their FB profiles in other places like their forums, blogs, and websites by creating a badge for the users to embed. This move created billions of impressions and generated millions of clicks and sign ups each month.
There are other companies, big and small, who have succeeded in hacking their way through, and growing their business exponentially.
Mindset of a growth hacker
Growth hackers come up with non-traditional and innovative ways to gain new users
An article titled “Defining a Growth Hacker: Three Common Characteristics” written by Aaron Ginn states the following as a common denominator for growth hackers;
1.) Love for data
As mentioned above, growth hackers are more analytical and tends to base their decisions and actions on measurable metrics. They have a stronger bias towards data rather than vanity metrics. Without metrics, growth hackers will feel uncomfortable and out of place.
Growth hackers love to experiment and push themselves to the limit. They know how to work around the system and even break within the boundaries and wander to territories that more established companies are afraid to do.
They are curious on why some visitors choose to be users and some others just straight up don’t. This fascination leads to constantly explore and discover new ways to push the metrics up.
In addition to these, here are other traits or mindset growth hackers have;
4.) Focus on growth
Rod Austin of Growthority said that “growth hacking is marketing in its purest form, you strip away everything and focus entirely on growth”. This is very true considering the fact that almost everything a growth hacker does and even the data they love is focused on growth.
5.) Growth is a science
Growth hackers are actually scientist in some ways; they hypothesize from observable data and they experiment before they put their strategies into bigger scales. They may fail sometimes, but they use these failures as guide for their future experiments. “Growth hackers don’t guess. They test.” –Sean Ellis.
The industry is ever evolving especially now that technology and other factors are drastically changing how we conduct our lives. The introduction of new concepts such as growth hacking are on the rise, rather than ignoring them only as a passing fad, you might want to adapt and be open to changes especially if you want your business to be able to cope up with societal changes and grow. Remember that your goal in business is to grow, and grow even more.