Growth Hacking. The Natural Outgrowth of Big Data.
Make no mistake, we feel that the best way to build advocacy is through positive buzz. Yet there is a way to short-circuit the process at times through ” growth hacking” which we practice ourselves. It pays to understand how it works even if it does not apply to you.
The most brilliant marketers today aren’t really hatching new ideas as much as they are hitching rides on ideas, audiences, and product advantages that already exist. The question for a cutting edge CMO therefore is to consider whether they will build from scratch or steal more cleverly than their competitors. This the promise and ethical challenge of growth hacking.
Big Data & the New Metrics
Big data is the tool that helps Growth Hackers find the fissures and loopholes in an online ecosystem to exploit. Today advanced metrics programs offer companies a myriad of ways to analyze the behavior of “people, not page views.” Growth Hackers hope this data will yield that killer insight, or what they call the “aha moment” that leads to a product breakthrough.
A classic application of the new metrics is how Twitter created “follower” functionality through the painstaking analysis of user behavior, not just page views. StumbleUpon was created by analyzing the sharing behavior of a billion bloggers in bite sized chunks. The use of data and statistics to improve processes and increase output is not new however. The difference between Growth Hacking and “continuous improvement” is the Growth Hacker’s obsession with the one or two metrics that will uncover the ideal “product market” fit.
The “Product Market Fit” and Viral Lift
Aaron Ginn, a growth hacker for StumbleUpon, explains that growth hacking has marketing goals “driven by product instincts.” He goes on to say that the goal is to find great, necessary and unique solutions to problems; and therefore, that the product should largely market itself.
While online products can’t always “sell themselves,” they can be designed to promote themselves. The difference between spreading a headache and a hit is to design “good stuff” that is engineered to be easily—but not obtrusively—shared.
Growth Hacker Ivan Kirigin says, “if your product involves sharing at its core, you should focus on optimizing and encouraging it.” DropBox grew by giving away free storage to users who shared their service. HotMail and others achieved growth along similar lines.
Customer Experience. Cheaper To Market.
Getting your first million users, however is useless unless they stick around. The Growth Hacker will therefore focus on retaining users by optimizing the customer experience. Many times they will intone that “retention is more important than acquisition,” mainly due to a dislike of marketing.
In words of Arhcie Abrams, director of growth at Udemy,: “It’s better to have 500,000 users, each spending $20 than it is to have 10 million users each spending $0.05. Companies that win find a channel like email, Facebook notifications or push notifications that can sustainably drive users back to their product.” Of course, if you think this sounds like online marketing, you are not alone.
The tools in a “growth hackers toolbox” are common to online marketing—A|B testing, landing pages, direct email, DRIP campaigns, content marketing and etc. Add to this more expensive tactics like paid search, and, pray tell, even an great spot video, and soon you are back to spending real money. This is because growth hacking does not obviate marketing but instead complements it on broader scale.
This is why many Fortune 500 firms have invested in internal “Skunk-works” departments to try and marry growth hacking with traditional marketing.
Lean Methodologies & Bite Sized Hacking.
The brightest minds within big companies realize that size tends to work against innovation. They also worry about spending big money on the next Edsel, Aztek or Google Wave. To combat this, many have created “Corporate Incubators” to grow bigger, better ideas from within.
It is no wonder, therefore, that such “Innovation Centers” embrace growth hacking.
Like growth hackers, they rigidly pursue data and metrics to produce ideas—both online and offline—that fulfill a potential market need. Like growth hackers, they carefully construct viral loops and feedback mechanisms reveal product flaws and establish KPIs—or Key Performance Indicators.
The T-Shaped Skill Set
Unlike the best “growth hacking” teams, however, many corporations still persist in hiring internal talent to staff their incubators. While there is nothing wrong with this practice, it does not tend to build a vibrant “Cocoon.” This is mainly due to the fact that an individual that has spent their career within one or two large corporate confines may lack exposure the often brutal marketplace of broader ideas.
This is why Ideo—one of the world’s most successful idea incubators—looks for individuals that have both a broad knowledge base and a deep talent in one or two fields–or what they call a “T-Shaped Skill Set.”
Put another way, Growth Hackers tend to be polymaths with a particular talent. Whether they know how to code, write copy or craft marketing unusually well, what they all share is a talent for stealing things that already exist deep within the web and the world beyond it.