By Michael Walker, Growth Marketing Manager: Gumtree South Africa
Michael Sugden, the CEO of VCCP, recently called “growth hacking” the single most annoying phrase in marketing today. That might be true, but it is a phrase we’re going to hear a lot more about in 2018 and beyond. Growth hacking is essentially a catch-all for data-driven marketing; the process of analysing, testing and retesting ideas in order to achieve the best results.
Successful growth hackers are not reinventing the wheel, they are merely sticklers for best practise – bringing together various departments to achieve a common goal, evaluating the bigger picture to develop a product that consumers actually want. Most companies apply at least some of the principles, but for it to be truly effective, you need to follow all the steps:
Plan for Growth Hacking
What doesn’t get planned, doesn’t get executed. Appoint a Growth Master among your staff. This can be an analyst, a marketer, a developer or a project manager – anyone that can assume the responsibility of setting up meetings and thinktanks on a regular basis and pulling the plan together.
Test, test, test
It’s important to foster a culture of testing. Plan for tests at every stage of your consumer journey. The Pirate or AARRR metrics are a good start:
- Acquisition: Are the right people getting to know you by name? Test your audiences. If your bounce rates are too high, it’s time to try a different audience – you haven’t found your tribe yet.
- Activation: Give them a great experience when they join. Rather than pat yourself on the back if 1000 customers visit your site, evaluate what they are doing once they’ve landed on your site or downloaded your app. The retention rates for apps are particularly atrocious – 80% of audiences will use an app for 3 days and never return. You have to get their attention early on to survive.
- Retention: Facebook found that if customers don’t add 7 friends within 10 days of joining the platform, they won’t retain them. Find out what metrics will keep a customer coming back for more and make that your North Star.
- Referral: Hotmail might have fallen out of vogue, but in 2011 they had over 360 million subscribers and grew by hundreds of thousands per month in the early days of the internet. Their most effective growth tactic? They added a signature to all outgoing emails that read “PS I love you! Get your free Hotmail account here”. It soon saw the fledgling company reach mass adoption. Are you testing referral tactics?
- Revenue: Don’t assume that the above steps guarantee a return on investment. Here’s an example: in online shopping, 70% of consumers abandon their carts. Surveys have shown that hefty shipping fees are the main deterrent for online shoppers. When last have you crunched the numbers and tested how free shipping might shift your stock and influence your average order value? Do you know whether customers would be willing to pay for a service that has always been traditionally free? Have you tested it?
Build products and experiences people actually want
You have to build products and experiences that people actually want, rather than what you think they want. To reach huge adoption numbers, your product has to get a thumbs up from early adopters. Products either captivate the first 15% or they die. Don’t spend six months building a product in isolation and then present it to the market. Start testing, trialling and retesting from the minute you’ve got your concept in mind.
If you are already implementing some of these principles, you’re well on your way to success. Take it to the next level: formalise your strategy, appoint Growth hack leads and determine your North Star metric for success. You will not only emerge with a more aligned team, but also with much greater insight into your customers.