Over the past few weeks, we’ve illustrated the successful growth hacking strategies used by startups. These have provided various outcomes to startups, such as operations or audience expansion. In Airbnb’s case, this involved the literal hacking of Craigslist for listing promotions. Zapier exemplified that more nuanced strategies like brand partnerships can also be effective.
If there’s anything to take away, it’s that each company has its own approach to growth marketing. But there are a few “ essentials” to keep in mind if you do plan on using a growth marketing strategy for your company.
What is growth marketing?
Let’s start with a quick recap. Growth marketing is an evolution of traditional marketing methods. It centers around accelerated growth using a modest budget. And it’s relevant to the needs of startups who want to acquire customers, but don’t have major funding. Tactics include viral marketing campaigns, social media, SEO, and other online techniques.
Benefits of growth marketing include faster customer acquisition, lower CAC (customer acquisition cost), and higher lead quality. But businesses other than startups can also benefit from this. For these reasons, growth marketing has also made its way to corporate environments.
The difference between growth and regular marketing
The role of a growth marketer will not be much different from a traditional marketer. But what is unique is that their sole focus will be on customer retention and acquisition. As such, growth marketers are not strictly salespeople or marketing executives— they may be engineers, writers, web developers, and even social media managers.
Growth marketers must be able to navigate through uncertainty, and with scarce resources. This makes their role somewhat more challenging compared to traditional marketing.
Key growth marketing concepts
To grasp the essence of growth marketing, it’s first important to understand the concepts that define growth marketing.
A/B testing and validated learning
One of the core tenets of growth marketing is to test every worthwhile theory with an experiment. This is an effective method of minimizing uncertainty while ensuring high ROI. One effective experiment might be testing the efficacy of two different landing pages (known as A/B testing). Another one might be running a low-budget ad campaign on social media.
Understanding the buyer persona
Understanding the buyer persona will set the groundwork for any campaign. This persona represents your ideal customer. Analysis should include everything from demographics, goals, pain points, to purchase behavior. Keep in mind, data will be composed of the aggregate of a much larger audience. But this will help your business make more accurate decisions related to acquiring and retaining customers.
Analyzing the customer journey
Whether you call it a conversion funnel, sales funnel, buyer’s journey, or customer journey, growth marketing is about understanding your customer. You should strive to understand their pain points and needs along the entire path. This may start with the moment a customer hears about you through an ad on social media. Or it might begin when a customer clicks to sign up. By exploring the fine details of their journey, you can develop more relevant ways to reach out to your audience.
Growth hacking vs. marketing
Growth hacking, growth marketing— what exactly is the difference? We’ve covered both concepts in the past, but is growth marketing the same as growth hacking?
Short answer— no. Growth marketing focuses on choosing strategy through experimentation and validating the best theories. Growth hacking, on the other hand, focuses on a single tactic or channel that yields the best ROI with a low budget.
If you’re still confused, here’s an example to clarify. Growth marketing may involve the use of multiple social media platforms to reach potential customers. The ultimate goal of each platform remains the same: to grow the company under a smaller budget. Differently, growth hacking would involve the development of highly-targeted social media ads or Facebook groups that encourage greater post engagement.
Other key differences between growth hacking and marketing include:
- Product focus. Growth hacking is more focused on improving a single product or channel, while growth marketing looks at the entire customer journey.
- Unconventional concepts. Growth hacking is more likely to feature unconventional or innovative concepts with greater risk, while growth marketing relies on more proven and tested practices.
- Tactics v. Strategy. Growth hacking may involve a single tactic, such as Airbnb’s cereal box sale. Growth marketing encompasses strategic decisions, such as the tactics to be used in social media or SEO.
Instead of having to choose between the two, consider how your company may use both. These are not mutually exclusive options. You can develop a solid growth marketing strategy while also experimenting with different growth hacking ideas. But be sure that your company plans accordingly to avoid wasting precious resources.
Growth marketing tactics
Stage-based content marketing
Content strategy plays a vital role in growth marketing. It is optimal as content production can be affordable, effective, and dynamic. Content can include blog posts, videos, podcasts, and other material found on your website that users can find value from. As your brand generates content that is relevant to your users, more people will seek out your brand. This will effectively save you time and money from developing costly marketing campaigns.
There’s a helpful way to approach your content using the ToFu, MoFu, and BoFu method:
- ToFU (Top of the Funnel) – this approach is centered on the number of leads. This stage may not be as persuasive and only seeks to provide useful information regarding a need or want of a customer.
- MoFu (Middle of the Funnel) – this approach is centered on positioning the brand as the leader of a certain industry or field. Content in this category is much more targeted.
- BoFu (Bottom of the Funnel) – this approach is centered on closing a sale. Content in this category is geared towards converting or convincing customers to try your product or service out.
Brainstorm the different content ideas your company can offer. How can you stay relevant in your customers’ minds as they move through the buyers’ journey?
Social media outreach
You cannot run a business in 2019 without the use of social media. Not only is it free to open an account, but you have the potential of reaching thousands of users across the world. Different social media tactics may include:
- Social media advertising
- Facebook and LinkedIn groups
- Direct message outreach
- Viral social marketing campaigns
- Video marketing
Each social network has a unique purpose, and it’s not advisable to use every single one. Instead, focus on the most relevant channels to your brand and audience. To learn more about the various social networks, check out our previous blog, 7 Important Social Networks for Entrepreneurs.
The price of your product or service is a strategy in itself. After researching your intended audience, you should have a good understanding of their budget and willingness to pay. There are four main pricing strategies to understand:
- Premium pricing – This strategy involves offering a product at a high price to evoke a connotation of quality or luxury. iPhones, for example, carry a premium price. But consumers are willing to pay because of the value and quality the phones provide.
- Penetration pricing – Conversely, this strategy is to offer the product at a competitively low price to amass as many customers as possible. This is a typical strategy for new product launches. You may see new restaurants or fast food places offer a major deal when they open shop for the first time.
- Economy pricing – Also known as mass-market pricing. The cost of this product typically has low marketing or overhead costs. Examples include household products and office supplies.
- Skimming strategy – For innovative products, a high price may initially be acceptable. When more competitors flood the market, the price will be forced down. You may see this strategy used by gaming consoles, televisions, and other electronic devices.
Think long and hard about your price. The number you end up settling on can have major implications on your supply chain as well as your consumer perceptions.
Advertising is all over the internet. You may see it reading an article, before a video starts, or even when you search for something. It’s easy to discount paid ads, but they can be an effective means of gaining customers. According to Formstack, PPC ads are one of the top three generators of on-page conversions.
Set up a small budget to test an ad campaign. You may set it up on Google Search, YouTube, social media, or various other platforms. To learn more about the efficacy of PPC marketing, check out QuickSprout’s article.
Examples of growth experiments
How can your company get started with experiments and validated learning? Here are a few simple ways that won’t break your budget but can yield useful results in strategic planning:
- Landing page A/B testing – When your customer lands on your website, what do they see? Will it be an ongoing deal, an exclusive offer? Whatever it is, you’ll want to test a few variants of design to see how effectively you can capture that user. Even the wording of your landing page can make the difference between a new lead and a lost opportunity.
- Price elasticity testing – How much demand is there for your product? Pricing tests can help you determine how sensitive consumers are to changes in price. This should help lead you to set the sweet spot for your product.
- Content-based experiments – Your customers need information, and your brand can provide answers. Consider a wide range of content types – guest blogs, infographics, user guides, reviews… the list goes on. It’s always important to understand your customer preferences before producing your content.
- Rich media experiments – Any ad that uses video or audio can be considered rich media. This experiment may be more costly, as it will have to involve a certain A/V production quality. But if your team focuses on media heavily, this experiment may lead to more leads.
- Programmatic experimentation – Programmatic advertising is an emerging field of ad building and selling. It is intended to lower the cost of your ad. This allows teams to create multiple variants of an ad, and test several copies or formats, without spending a fortune. To learn more about programmatic advertising, check out Marketing Week’s beginner’s guide.
Experimentation is of the utmost importance when it comes to growth marketing. Many of the previous techniques employed by startups were theories put to the test. There is no standard when it comes to growth strategy, except that it should involve the same principles and methods as any other experiment. Start small, review your analytics, and re-tool based on feedback.
Growth marketing is a more deliberate approach to growth compared to hacking. Don’t expect overnight returns. Instead, work towards incremental improvements, slowly adding to your service’s value over time.
Look no further than Gabriel Weinberg’s story, the founder of DuckDuckGo and one of the biggest alternatives to Google today. Even though his search engine launched in 2008, he didn’t begin seeing results until years later. He recalls his story to Forbes:
I launched DuckDuckGo at the end of 2008, and in March of 2009 my first son was born and I decided to stay at home with him for at least the first two years. Through those two years I just kept at it and tinkering with it. At the end of 2010 all the iterative work on the project became better. Something clicked and people started to switch to it. Then in 2011 I started to treat it as more of a real thing, and at the end of 2011 I went and raised $3 million from Union Square Ventures.
Don’t lose sight of your company’s vision. The first few years of growth marketing may be an uphill climb, but the journey is half the experience.
Looking for audio content on growth marketing? Check out the Growth Marketing Toolbox podcast, a biweekly show about important growth marketing strategies companies use today.