Growth Hacker Marketing… a primer on how marketing is evolving, with real strategies and tactics by Ryan Holiday, the former director of marketing at American Apparel, recently turned media guru for best-selling authors.
In Growth Hacker Marketing, he explains why traditional marketing efforts aren’t the most effective, and shows what we can do about it.
The Growth Hacker Formula consists of:
- Achieving product-market fit… because it all starts with selling something people really want;
- Finding a growth hack to go viral cost-effectively; and
- Closing the loop with high retention – turning one-time transactions into sticky or repeat customers.
In order to better follow this formula, we’re going to tackle:
- What is growth hacking; and
- What does it mean to achieve product-market fit
In traditional marketing, the development team builds a product and hands it over to the marketing team when it’s done. Marketers have to work with what they’re given, and it’s all about spinning the customer’s perception about the product.
In contrast, a “growth hacker doesn’t see marketing as something one does but rather as something one builds into the product itself.” It’s a completely different mindset that brings science to marketing.
In money terms, traditional marketing needs large budgets and is infamous for its inability to track results and ROI, whereas growth hacking relies on small clever triggers that create a self-perpetuating marketing machine, often referred to as ‘going viral’. The growth-hacker playbook consists of only what they can test, track, and scale with minimal budgets
A case in point is Hotmail. Initially, the founding team kicked around traditional growth ideas such as advertising on billboards and radio ads. But these were too expensive and with questionable return. In the end – and after months of pushing back on the idea – they incorporated the famous “P.S.: I love you. Get your free email at Hotmail” at the bottom of each email sent out by their users, and achieved viral growth.
For growth hacking to be successful, it has to start with the right product. Growth hackers recognize that this doesn’t happen the first or the second time, and they treat their product as something malleable.
Almost no company starts off with the perfect solution, which justifies the practice of developing a minimum viable product in order to get it out to the market as soon as possible, test the fit, gather feedback, and iterate. This cycle repeats as many times as it takes.
Growth hacking actually provides a good test for when a product has achieved product-market fit: it’s when growth hacking works! If you have built a viral feature into your product but you’re not getting viral growth, then the flaw is probably with the product. Get feedback and iterate until your growth machine starts firing off on all cylinders!
An example of this is Instagram. It started off as a location-based social network that wasn’t gaining much traction. But its founders noticed that all their users were going to the photos and filters section of the app. So they pivoted and focused on what worked, refined it, and sold to Facebook for $1 billion.
What does it all mean
The two keys to growth hacking are:
First, develop a great product that truly resonates with your market; and
Second, resist the temptation to go BIG! Because that’s expensive and it’s how traditional marketers think. Instead, identify a niche, core user-base that you can reach cost-effectively. You want those fanatical first users that will help you grow… for free!
It all boils down to bringing science into marketing and delivering results on very limited or non-existent budgets.