Growth hacking is the new marketing. It’s responsible for the success of many of the multi-billion dollar tech companies which were once small virtually unknown startups. The primary goal of growth hacking is to build a self sustaining marketing machine that reaches millions of target customers by itself and, continues to grow.
Unlike traditional marketing where huge budgets and certain predefined marketing strategies are at your disposal, growth hacking is all about using the limited resources available and innovatively coming up with results that contribute to the end goal. The growth hacker’s main job is to grow something out of nothing within a small time frame. To achieve this, he or she focuses on strategies that are testable, repeatable and scalable.
Most businesses that have grown as a result of growth hacking have a fairly similar growth pattern that involves, attaining product-market fit, A/B testing to find which growth hacking strategy will bring the fastest growth, going viral, optimization and retention of your existing customers. Finding which growth hacking strategy is most suitable for your small business is a crucial step that will determine whether it will grow exponentially or, fizzle out and die. The following are five of the top growth hacking strategies used by some of the world’s biggest companies.
One of the basic human needs is “belonging”. Everyone wants to feel part of an exclusive social group. If leveraged as a growth hacking strategy, exclusivity and belonging can drive a new small business’ growth. Exclusivity works by allowing usage of your business’ product or service to a “select” group of people. If someone is chosen to be among the select few, they in turn can invite their friends and family, whom they consider worthy of joining the group.
A classic example of this growth hacking strategy in use is Google’s Gmail service. Gmail is a relatively new free email service provider compared to other companies such as Yahoo and AOL. However, exclusivity as a growth hacking strategy enabled the company to become the biggest free email service provider in the world. Currently, Gmail has over 900 million active email accounts. The first Gmail users could only open a new account if they were invited by an existing user. This alone made this service “exclusive” and aroused curiosity such that when this growth hack was withdrawn, the number of new email accounts opened rose exponentially.
Leverage existing technology
This is perhaps the most common growth hacking strategy employed by new small businesses. Many startups are leveraging social media networks, online news sites, search engines and other existing technologies to fuel their growth. Success from leveraging existing technology largely relies on whether your target customers are using it, and how well you can test and track results.
PayPal’s growth is largely attributed to leveraging eBay’s existence. Initially, PayPal offered $10 for new signups. However, this costly marketing stunt was abandoned and focus shifted towards leveraging the already established and growing eBay user base to fuel growth. PayPal engineers created a program that bought items on eBay but only paid through PayPal. PayPal merchants had no option other than to open PayPal accounts to make the sale. This growth hack saw PayPal grow into a recognized international online payment gateway. Incidentally, eBay eventually acquired PayPal in 2002.
Create a referral program
Word of mouth is one of the classic and most effective growth hacking strategies available to any new small business. If you can get your existing customers to spread the word about your business, this alone is enough to propel its growth. For referrals to work as a growth hacking strategy, two conditions must be met:
1. You’ve already attained market product fit
2. Existing users are happy with your product or service and wouldn’t mind recommending it
Once these two conditions are met, all you need to do is ask your users for referrals and possibly offer an incentive.
One of the best examples of a company that uses referrals to drive growth is Dropbox. The company offers 500MB free for any new sign up that’s made through referral to both the new user and the person that referred them. The company also offers free space for simply liking Dropbox in.
Solve a specific problem for specific people
Some of the most successful growth hacks started off as specific solutions to specific problems. These companies focused on a specific niche rather than try to offer a product or service that caters for the general population. As the service or product attracted more users, its usage became more general while still catering for the initial niche market.
A good example of a service that solved a specific problem for specific people is GitHub. GitHub launched to provide a repository for projects that used Git version control system. It solved a common problem software engineers working on collaborative projects had. Updating and revising code was now easy and could be done from any location in real time. Although initially created as a repository for code, GitHub today acts as a repository for virtually any computer generated content ranging from eBooks to images. It’s also commonly used by coders to build their portfolio to attract potential employers.
This is another growth hacking strategy that can propel a new small business’ growth. An influencer is simply someone who commands the attention of your target customer. There are several ways by which you can leverage influencers to drive your small business’ growth. They include the following:
- Partner with an influencer by offering a stake or incentive in your business
- Make it possible for influencers to interact with their followers through your product or service
- Have an influencer endorse your product or service
- Interview influencers and provide the content for free
The growth hacking strategy you choose to grow your new small business largely depends on what type of business it is, your target customer and how easy it is to test and track results. Its worth noting that majority of growth hacking strategies have a short lifespan usually lasting a few weeks to a few years before growth starts to slow down. As such, its important that you keep innovating and introducing new features to your product or service in response to user interaction with your business. This is what is referred to as retention and optimization.