What is a growth hacker? How to be?

This studies article via way of means of Rusheé Ramchuran explains The Lean Startup Methodology, and explores virtual transformation as a catalyst for increase hacking, with real-global examples.
High and sustainable increase groups (groups with as a minimum a 20% annual sales increase common over 3 years) have generated substantial hobby in latest times – in large part because of the reality that those groups force new innovation withinside the global, make a contribution toward excessive professional task advent withinside the economic system and are pushed to scale-up over the lengthy-time period to supply substantial cost to society (in preference to specializing in brief-time period income or exits).
Such groups have leveraged virtual technology and increase techniques in progressive approaches to attain sustainable increase in a brief span of time and supply merchandise/offerings which have for all time modified the panorama of worldwide industries. These a success increase techniques (additionally referred to as increase hacks) are the fabricated from collective efforts from engineering, advertising, leadership, layout, and product management (Keating, 2021).
Most excessive increase early-level groups differentiate themselves via way of means of being acknowledged as builders of recent improvements of their enterprise, and the global (Reypens et al, 2020). According to an EIBIS Start-up and Scale-up Survey in 2019, with 1,a hundred+ corporations sampled from Crunchbase – 65% of excessive increase groups suggested that the maximum progressive factor approximately their commercial enterprise is a brand new global innovation. Similarly, Wei (2019) concludes that groups which innovate new technology can have extra improvement possibilities and enjoy better increase charges. However, technological innovation additionally calls for extra time, abilities and capital funding to attain speedy increase – which many early-level groups do now no longer possess. Instead, commercial enterprise version innovation that correctly leverages virtual channels and techniques also can attain increase in a extra fee-powerful and sustainable method (Wei, 2019).
This commercial enterprise version innovation has caused the muse of what is thought nowadays as “increase hacking”. The time period become coined in 2010 via way of means of Sean Ellis, who characterized a increase hacker as “someone whose actual north is increase” (Ellis, 2010). The manner of increase hacking in groups is enabled via way of means of virtual transformation and is depending on speedy experimentation and the tilt startup method (Ellis and Brown, 2017).
1. The Lean Startup Methodology
Previous methodologies to beginning a commercial enterprise concerned growing a commercial enterprise plan, pitching it to investors, assembling a crew, introducing a product, and promoting as aggressively as viable. This method ended in as much as 75% of US venture-sponsored startup groups failing inside their first 3 years, consistent with Harvard Business School professor Shikar Ghosh (Blank, 2013).
The lean startup method become delivered via way of means of Eric Ries to lessen the dangers of failure in early-level groups. This method prioritises experimentation over massive planning, purchaser remarks over intuition, and iterative layout over huge in advance improvement. The lean startup technique enables groups to validate product and marketplace suit on the early degrees of the product lifecycle earlier than dedicating substantial assets for similarly improvement and increase (Kenton, 2019).
Despite being in lifestyles for just a few years, it’s key concepts—along with “minimal possible product” and “pivoting” had been broadly followed via way of means of worldwide startups as a framework for speedy go-to-marketplace approach and sustainable increase.
However, the tilt startup version additionally differentiates itself withinside the hiring of recent personnel which could examine, adapt and paintings fast as antagonistic to standard commercial enterprise fashions that lease primarily based totally on enjoy and cappotential (Blank, 2013). The advantage of this method is that groups can minimise the preliminary fees on human assets, and increase unique abilities required to scale product and sales increase for the commercial enterprise version. However, the brief-time period financial savings in human capital will become lengthy-time period funding in ability education and improvement. To correctly increase a increase approach, a sure diploma of technical, product and marketplace-associated information is needed inside a crew – at the side of synergistic efforts on implementation. Yet, relying at the employer’s enterprise – distinctly specialized abilities can call for better marketplace salaries (along with huge records and cloud computing, synthetic intelligence, records evaluation, cellular app improvement and extra), even at early degrees of commercial enterprise (Slattery, 2019).
Similarly, the tilt startup version differentiates itself from conventional commercial enterprise fashions in its monetary reporting metrics. Traditional commercial enterprise fashions prioritise earnings statements, stability sheets and coins glide statements as measures of increase, while the tilt startup version prioritises purchaser acquisition and retention, churn price, purchaser lifetime cost and product virality as increase metrics (Kenton, 2019). This technique of size enables groups to higher align product and commercial enterprise approach to fulfill purchaser and marketplace demands – riding sustainable increase over the lengthy time period. By specializing in metrics like purchaser acquisition and retention, and purchaser lifetime cost, groups can make investments extra assets to apprehend purchaser desires and a way to resolve them – or even are expecting converting purchaser behaviour and possibilities to evolve the product and commercial enterprise approach in time to minimise hazard of failure.
Ironically, the number one intention of the tilt startup version isn’t always for groups to attain speedy increase withinside the shortest viable time, however to “attain failure fast and cheaply” with the intention to examine and adapt the product and commercial enterprise approach to attain sustainable increase over the lengthy time period. This manner of speedy experimentation and agile product improvement can bring about groups growing new global improvements that resolve worldwide enterprise challenges – along with General Electric who used this technique to increase a brand new battery to be used via way of means of mobileular telecellsmartphone operators in growing nations wherein strength is unreliable (Kenton, 2019). The lean startup method isn’t always handiest followed via way of means of early-level groups, however additionally via way of means of large organizations along with General Electric, Qualcomm, Intuit, Amazon, LinkedIn, Airbnb, Hubspot and extra (Kenton, 2019 and GrowthHackers, 2021).
2. Digital Transformation and The Growth Hacking Framework
Figure 01: The Growth Hacking Framework (Bohnsack and Liesner, 2019)
According to Bohnsack and Liesner (2019) – virtual transformation is an essential catalyst for increase hacking. With the price of improvement of recent technology, virtual transformation has turn out to be even extra vital for groups nowadays, irrespective of their size – but it additionally gives possibilities as nicely challenges. For instance, the improvement of smartphones, social media and huge records has enabled groups to immediately attain hundreds of thousands of purchasers with little to no marginal fee – permitting those groups to scale their increase a whole lot quicker and at decrease fees. In contrast, it additionally will increase opposition via way of means of reducing limitations of access for different groups to go into the marketplace and deal with client desires Bohnsack and Liesner (2019).
As depicted in Figure 01, Bohnsack and Liesner’s (2019) Growth Hacking Framework follows the tilt startup method (additionally referred to as the tilt philosophy) and is precipitated via way of means of virtual transformation. In this diagram, Growth Hacking is the mixture of Digital Marketing Techniques, Data Analysis and Testing in addition to Coding and Automation.
2.1. Digital Marketing Techniques
The first issue of increase hacking entails advertising, or extra specifically, virtual advertising – which revolves round products or services advertising via virtual and on-line channels (consists of e mail; internet site; engines like google; social media; virtual marketing and marketing and cellular apps) (Kannan and Li, 2017).
Digital advertising makes a speciality of verbal exchange via way of means of growing consciousness and obtaining new purchaser, as a result it typically creates touchpoints at the start of the purchaser lifecycle. Bohnsack and Liesner (2019) similarly become aware of that increase hacking has touchpoints at some stage in the purchaser lifecycle just like the conventional advertising version of 4Ps (product, price, merchandising and place) – making increase hacking a “virtual go back to the classical advertising values”.
However, many groups have efficaciously applied increase hacks inside virtual advertising strategies which have visible exponential go back withinside the shape of recent purchaser acquisition.
Figure 02: Screenshot of the Dropbox Referral Growth Hack (Mengoulis, 2019)
An instance of a a success implementation of a increase hack that consists of virtual advertising strategies is Dropbox. The cloud garage software program as a service (SaaS) employer applied a referral software that advocated current customers to ask buddies and worthwhile each events with more garage due to a a success signal up. As proven in Figure 02, Dropbox allowed customers to ship direct e mail invites to buddies via the platform and blanketed a right away percentage button hyperlink to social systems like Facebook, and a duplicate hyperlink button to percentage on web sites or genuinely any on-line channel. By starting the virtual advertising channels to which the referral may be shared and addressing the purchaser want for extra garage – Dropbox become capable of develop via way of means of 3900% from September 2008 (100k customers) to December 2009 (4M+ customers).
Figure 03: Screenshot of the Bio Extratus’ Social Content & Users (Nunes, 2020)
Another powerful instance of increase hacking the use of virtual advertising strategies is the case of Bio Extratus, a employer that produces and sells herbal cosmetics with a focal point on being environmentally conscious. The employer used powerful content material advertising as gas to force increase via digitals channels, after realising that many competition targeted on growing content material round merchandise as opposed to purchasers (Nunes, 2020). Bio Extratus evolved purchaser-centric content material that targeted on center values and issues in their target market, and used a combination of influencers, social community distribution, videos, tutorials and weblog posts to attain their purchasers with the number one intention of instructing and informing (see Figure 03). This method proved powerful because the content material become now no longer handiest valued via way of means of customers however additionally via way of means of engines like google, which listed and ranked Bio Extratus’ fine content material excessive in seek engine results – riding natural internet periods up via way of means of 400% in 12 months from 530k+ to 4.3M+ (Nunes, 2020). This caused engines like google turning into the primary supply of natural site visitors for the employer and correctly decreased the general acquisition fee of recent clients via way of means of 42% (Nunes, 2020).
What is obvious in each Dropbox and Bio Extratus is that those groups understood their target market desires and evolved a increase hack that might now no longer handiest resolve the want via virtual channels however create extra blessings for customers withinside the manner.
2.2. Data Analysis and Testing
Customer possibilities and behavior are continuously converting due to various of things that impact shopping decisions (from demographics to lifestyle developments and individualism), this means that groups want to higher apprehend their clients so as are expecting the alternate in possibilities and behavior, or maybe impact the alternate to align with a product or commercial enterprise approach. Understanding purchaser possibilities and behavior, while not having to invite clients, can create a aggressive advantage (Bohnsack and Liesner, 2019). With the upward thrust of huge records and development withinside the Internet of Things, groups nowadays can immediately accumulate and get entry to purchaser-unique records and leverage technology that translate the records into moves that force higher decision-making (Bohnsack and Liesner, 2019).
As identified, the tilt startup method entails a manner of speedy experimentation to fast set up product and marketplace suit (Kenton, 2019). These collection of experiments and checking out calls for records to be accrued in every state of affairs and translated into actionable analytics that assist groups to make extra knowledgeable commercial enterprise decisions. The extra experiments that a employer can run, the extra records is accrued from clients, growing a substantial getting to know and evaluation possibility for the employer to higher apprehend and are expecting purchaser possibilities and behavior.
Figure 04: Screenshot of an A/B Test performed on Amazon’s Platform (Leone, 2021)
Amazon is one of the maximum valued groups withinside the global, with a valuation of over US$1 trillion in 2020. Founder, Jeff Bezos, attributes the fulfillment of Amazon as a characteristic of what number of experiments the employer runs in line with year, in line with month, in line with week and in line with day (Leone, 2021). Amazon correctly runs 10k+ A/B checks yearly on its e-trade platform to higher apprehend purchaser possibilities and decorate the purchaser enjoy of buying on-line with Amazon. The varieties of experiments performed span throughout internet site adjustments, including new capabilities and layout adjustments, placement of elements, updating algorithms for recommendations, converting seek relevance rankings, making strategic partnerships and introducing new offerings (see Figure 04). Even the smallest adjustments will have substantial effect whilst applied correctly. For instance, certainly considered one among Amazon’s checks found out that transferring credit score card gives from the house web page to the buying cart boosted Amazon’s income via way of means of hundreds of thousands of dollars (Leone, 2021).
Figure 05: Screenshots of the Early Tinder Dating App and Gamification Features (Brown, 2015)
Tinder is every other instance of records evaluation and checking out in a increase hacking approach that targeted on narrowing down the target market and gamifying the consumer enjoy. The on-line relationship cellular app delivered itself to university college students among the a while of 18 and 25 on campuses withinside the United States, with a demand to down load the app to be granted access right into a social party (Brown, 2015a). The app become loose to down load growing a low barrier to access for university college students. Once the app become downloaded at the student’s telecellsmartphone – the region-primarily based totally settings allowed the consumer to discover others of their region who had been open to relationship, and pioneered the ‘swipe left for no or swipe proper for yes’ and gamification characteristic that furnished the equal feel of intuition and praise the real-existence relationship global (see Figure 05). With its simplicity – phrase of mouth had unfold growing a community impact, and in only years – the employer’s consumer base had grown to 10M+ (Brown, 2015a).
For groups trying to put in force a increase hack approach, the manner of records evaluation and non-stop checking out is pivotal to information purchaser possibilities and aligning a product and marketplace approach for fulfillment. According to Jeff Bezos, groups need to study maximising the range of experiments that may be performed in a given time period, lessen the fee of jogging the experiments, and increase infrastructure with a view to allow this (Leone, 2021). However, groups want to make certain that any private consumer records that accrued in those experiments is accomplished so legally, with consent from the consumer to be used in evaluation and product or commercial enterprise improvements.
2.3. Coding and Automation
Bohnsack and Liesner (2019) become aware of the 1/3 issue of a increase hacking approach as coding and automation, which entails growing or programming code and automating touchpoints with the consumer and product to make the manner extra efficient. In earlier years, the technical functionality and information of coding might had been vital to construct an automatic increase hacking approach – but with the upward thrust of the no code revolution, extra personnel in non-technical departments also can discover ways to construct superior workflows the use of software program that communicates with every different while not having to jot down a unmarried line of code (Pot, 2020). This shift reinforces the hiring method withinside the lean startup method, as complicated and technical answers can now be learnt, evolved and applied via way of means of non-technical customers – making increase hacking techniques available to extra groups. Furthermore, the upward thrust of synthetic intelligence already has, and could keep to, decorate the consumer enjoy of clients digitally with automation and personalisation that creates a tailor-made and one-to-one engagement.
Figure 06: Screenshot of an Airbnb list on Craigslist in 2011 (Brown, 2015)
Airbnb, the bendy lodging reserving app, is famously acknowledged for its increase hacking approach, albeit one which entails technical information and coding information. In 2010, the Airbnb crew observed that almost all in their target market, being folks that had been searching out opportunity and lower priced lodging, looked for those list on Craigslist – a famous classifieds internet site on the time (Brown, 2015b). Craigslist had a substantial consumer base over Airbnb. Airbnb constructed an automatic bot that enabled its customers to create a list, replica it without delay directly to Craigslist, confirm the records and and put up it (see Figure 06). This allowed Airbnb to attain Craigslist’s large consumer base, and whilst the consumer clicks at the list – it redirects them to the Airbnb internet site list to finish the reserving (Brown, 2015b). Once Craigslist had observed the loophole, that they’d up to date their platform to save you this from going on similarly – but, via way of means of then the Airbnb consumer base had grown substantially. While this increase hack become manageable in 2010, it will become extra complicated to put in force a comparable hack in nowadays’s virtual global because of advances in technology, protection and platform architecture. Instead, a key takeaway from this increase hack is the cappotential to combine or extra systems which could automate and percentage records. For instance, systems like Zapier and IFTTT permit customers and groups to attach unbiased systems and apps via way of means of sharing records via stable APIs. This lets in groups to construct complicated automation workflows that syncs records throughout a couple of systems with out the requirement of coding information or information. As mentioned, this makes increase hacking techniques extra available to groups at decrease ability and labour fees.
3. Challenges of Growth Hacking Strategies 3.1. Skilled Labour Requirement
While increase hacking calls for a collaborative attempt throughout a couple of departments and disciplines, it additionally calls for a hybrid or multi-professional leader, marketer or engineer who can bridge the information hole and force each the imaginative and prescient and execution of the approach (Bohnsack and Liesner, 2019). Highly professional increase hackers are tough to discover because the idea and call for of such experts has existed for a brief span of time. It can be a higher funding for groups to teach and increase increase hacking abilities and information inside their crew with the intention to minimise fees, lessen time to product or marketplace suit and increase specialized techniques primarily based totally at the unique commercial enterprise version.
3.2. Time, Product and Market Relevance
Being first to marketplace is an essential issue and substantial fulfillment for any sort of product or employer, but as soon as the barrier has been broken – the hazard of opposition will increase especially if product-marketplace suit has been validated. For instance, Uber can also additionally had been the primary ride-sharing app delivered in 2009 – however following from the preliminary product and marketplace validation, comparable merchandise and groups (along with Lyft) entered the marketplace to compete for marketplace percentage (Sui, 2017). As established, a increase hack approach along with that applied via way of means of Airbnb can also additionally had been powerful in 2010 – but a comparable approach won’t be legitimate or executable in nowadays’s virtual global. It need to additionally be taken into consideration that a product which existed, and accomplished popularity, in preceding years won’t exist nowadays or withinside the destiny because of converting purchaser possibilities, trends of recent technology or higher alternatives – as an instance MySpace (Coronel, 2021).
3.3. Cost of Exponential Growth
Growth hacking techniques can cause speedy increase in brief time frame, however groups will want so that you can scale their operations thus to fulfill the newly generated call for. Failure to supply on services or products as increase charges growth will have a counter-impact at the targets of the increase approach applied. Furthermore, because the fulfillment of the increase hack approach scales, so too will the fee of increase. For instance, PayPal’s increase hack approach concerned a referral gadget that rewarded each the consumer and their pal with US$10 every for signing up because the lifetime cost of the consumer become calculated to be US$20. This approach helped PayPal to develop their consumer base each day via way of means of 10% to attain a hundred million customers, but the overall fee of this referral gadget become expected to be US$60 million (Hall, 2019).

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