Growth Hacking Demystified for Entrepreneurs, CEOs, and Startups

Growth Hacking Demystified for Entrepreneurs, CEOs, and Startups

Growth hacking is a buzzword from Palo Alto. It supposedly is the Holy Grail for startups. Move over marketers, growth hackers are here. If we follow the common belief in business nowadays, it is not as if growth hackers will replace you; they are just different and therefore, a growth hacking team should coexist with your marketing team. Is this justified though? Not everybody believes that the so-called magical mindset of a growth hacker is unique.

In this blog, I will give the definitions of growth hacking and growth hacker, and I will list the arguments of online marketers who believe that growth hacking is just simply online marketing. After that, entrepreneurs and startups will know what they should focus on in order to be successful, and CEOs will know if they should approve job openings for growth hackers or change them into job openings for online marketers.

‘Growth hacking demystified for entrepreneurs, CEOs and startups’ Growth hacking supposedly is the Holy Grail for startups. In this blog, I give the definitions of growth hacking and growth hacker, and I list the arguments of online marketers who believe growth hacking is just simply online marketing. Read it here:

What is growth hacking and what is a growth hacker?

Sean Ellis first coined the title growth hacker in 2010, when he was looking for his replacement. Aaron Ginn says that unlike most professions in technology, a growth hacker is not a set of skills or a stock of knowledge. Dan Martell, the founder of Clarity, says, “Growth hacking is a mindset more than a toolset.” It is a set of disciplines learned through doing and out of necessity. Growth hackers have a common attitude, internal investigation process, and mentality unique among technologists and marketers. Growth hackers have a passion for tracking and moving a metric. This strong bias towards data drives a growth hacker away from vanity metrics towards metrics that will make or break the business.

Creative problem solvers

According to Ginn, while driven by data and moving metrics, growth hackers are also creative problem solvers. A growth hacker has a vibrant mental dexterity to think of new ways to acquire and loop in users. This creative and analytical mashup is the defining characteristic of growth hackers. A growth hacker has a fascination at why visitors choose to be users and engage and why some products fall flat on their face. Most growth hackers say they learned out of necessity from starting a company with a zero marketing budget.

Andrew Chen, calling growth hacker the new VP of Marketing, says, “This is not just a single role – the entire marketing team is being disrupted. Rather than a VP of Marketing with a bunch of non-technical marketers reporting to them, growth hackers are engineers leading teams of engineers. The process of integrating and optimizing your product to a big platform requires a blurring of lines between marketing, product, and engineering so that they work together to make the product market itself. Projects like email deliverability, page-load times, and Facebook sign-in are no longer technical or design decisions – instead they are offensive weapons to win in the market.”

The difference between growth hacking and marketing

Gagan Biyana hates the term growth hacker and says that it is not new, but according to him, “growth hacker is here to stay. So we may as well own it and make it clear what it means — that way, we can actually use it, hire for it and train for it.”  He claims that growth hacking mostly occurs in startups, for which he has three reasons:

  1. Startups are organizations with extreme uncertainty.
  2. Startups are designed for astronomical growth.
  3. Startups do not have access to the same resources or brand equity.

Tactics of growth hacking

According to Biyana, the primary tactics most growth hackers use are viral acquisition, paid acquisition, call centers/sales teams, content marketing, e-mail marketing, SEO, and A/B testing and analytics.

Examples of growth hacking

Most articles list Airbnb, Hotmail, Twitter, Facebook, YouTube, Amazon and LinkedIn as great examples of growth hacking. Google their case studies for more information.

What growth hacking is not

The definition of growth hacking

However, not everybody is happy with the term growth hacking. Muhammad Saleem speaks out against it: “The startup world and the technology blogosphere have spent the better part of the last decade misunderstanding online marketing, making broad generalizations about marketers and maligning the industry as a whole — only to now realize how essential online marketing is to their own success. So, what do you do when you find yourself in a situation such as this one? Rebrand, rebrand, rebrand! And thus, the term “growth hacking” is born.”

Biyana agrees that growth hacking is not a new practice: “It is just a new term. Anyone who figured out how to game Google’s algorithm (aka SEO) was leveraging both creativity and analytics to rapidly grow their company. Amazon’s legendary use of A/B testing surely fits into the category of growth hacking. So does LinkedIn’s ingenious email importing scheme (where users were prompted to let LinkedIn import their email contacts and send them a note inviting them to the service).”

The act of growth hacking

Saleem disagrees that this belongs to growth marketing: “What does “growth hacking” entail, then? Let us see:

  • Creating a search-based user acquisition strategy through content marketing and search engine optimization and marketing
  • Embracing social media technologies and building a presence on platforms like Twitter and Facebook
  • Using search to inform your product development roadmap
  • Optimizing your websites for user experience and conversions
  • Using cost-effective methods of advertising through in-depth analysis of analytics and extensive A/B testing

Not only are the tactics above not growth hacking, but they are also nothing new — this is online marketing as we have known it for years. SEO, SEM, SMO, SMM, content marketing, analytics, A/B testing, sales funnel/sales loop workflows, and conversion optimization are fundamentals of online marketing and have been since the emergence each of these platforms.”

Growth hacking important

Saleem says that growth hacking is that important, it should be considered “a wake-up call for the startup industry and technology blogosphere to start taking online marketing as we have known it for years more seriously. To suggest that the secret of growth hacking is the mindset not the toolset detracts from its effectiveness. One of the fundamental principles of online marketing is the emphasis on a company-wide, holistic strategy that combines both mindset and toolsets.”

Saleem also disagrees with Nabeel Hyatt who says, “If I’m given 1,000 visitors and I’m trying to convert as many as possible to customers, it is lead gen optimization. If I’m tuning the product to convert 1,000 visitors into 10,000 customers, it is growth [hacking].” Saleem: “Well, he’s wrong. If you are not focusing on turning 1,000 leads into 10,000 leads, you just have a crappy sales funnel.”

Deconstructing growth hacking & growth hacks

Saleem also attacks the famous examples of growth hacking:

  • Paypal’s Friend Referral Bounty. Paypal gave $10 to each new customer and $10 to the customer who referred them. This is called referral marketing.
  • Hotmail Tagline. Hotmail would add a signature at the bottom of outgoing messages saying,”Get your free email at Hotmail.” This is called email signature marketing and is one of the most underutilized marketing tools.
  • Airbnb’s Craigslist Integration. AirBnB enabled cross posting of your listing to Craigslist. Cross posting as a form of marketing has existed since the days of forums and newsgroups. This is nothing new.
  • Dropbox Incentivized Referral Program. Dropbox gives you free storage for inviting your friends to Dropbox. Once again, this is called referral marketing.
  • Instagram Cross-Posting. Instagram enabled posting images to Twitter and Facebook. Once again, this is cross-posting as discussed above.
  • com Content/SEO Strategy. Mint developed a content marketing strategy based on search and social. This one is explicitly pointed out as content marketing and search engine optimization.

A growth-hacking toolbox?

The tactics mentioned above? Not a specific growth-hacking toolbox: “All those tools are in every good online marketer’s toolbox regardless of the type or scale of company you are working for.”

  • Viral Acquisition — is a commonly used strategy by online marketers at the bottom of the sales funnel to engender customer loyalty and acquire customers through referral marketing or word-of-mouth.
  • Paid Acquisition — search ads, display ads, affiliate marketing, Facebook ads, mobile ads, and search engine marketing are all forms of paid acquisition used by online marketers.
  • Content Marketing — is a fundamental underpinning of any search optimization and marketing strategy, and it is hard to have a social media strategy without content marketing.
  • E-mail Marketing — is one of the most basic tools at the disposal of an online marketer and predates most social media.
  • Search Engine Optimization — “Startups that use SEO effectively build a scalable infrastructure that applies to tens of thousands or millions of pages. Most of the SEO theory on the web is focused on ranking for just 5-10 keywords.” On the surface, I believe the argument is distinguishing between short-tail and long-tail SEO but at the scale we are talking about, it seems more like something that would get you banned rather than let you capture the long tail. Either way, any complete SEO strategy focuses on both short-tail and long-tail keywords.
  • A/B Testing & Analytics — As I’ve mentioned before, A/B testing is vital to any organic or paid search campaign and necessary to optimize sales conversion workflows.

Real growth comes from somewhere deeper than growth hacking

Whether these tools can be labeled online marketing or growth hacking, one should focus on the most fundamental of issues rather than on something trivial. Ben McRedmond,  Director of Growth at Intercom, calls growth hacking bullshit, saying that “it all smells too strongly of a ‘get rich quick’ scheme. I have come to believe real growth comes from somewhere deeper than growth hacking.”

McRedmond says that too often in addressing growth, actual problems are substituted with easily measurable problems. At the highest level, these micro definitions can cause teams to overlook the most fundamental of all issues: is your product solving a real problem? At a lower level, the danger of micro definitions is they result in micro efforts. For near-term growth-orientated product teams (often called “growth teams”) and marketing teams, focusing on the immediately measurable should not translate into focusing on the trivial.”

As he concludes, “growth does not come from silver bullets; growth comes from winning a thousand tiny battles: 0.5% here, 1% there. Real growth needs a whole load of lead bullets. Real growth originates from the very first line of code, from a great product, and from the work of an entire team.”

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