If you’re an entrepreneur, you probably already have the mindset, the drive and the passion to overcome the toughest of obstacles and carve out your success. But the truth is these traits are no longer enough. It’s 2016, and the skills needed to succeed in business are different today than they were a decade ago.
So, you are an entrepreneur. You love your job. You’re passionate about your product and you love the freedom that comes with being your own boss.
Everyone’s dream, right?
Unfortunately, not everyone is as passionate about your products as you are. You haven’t been seeing the sales and the growth you dreamed of. Despite your best efforts, things are somewhat stagnant and you don’t know what to do.
You’re trying to keep up with the times. You made a Facebook page, you send newsletters, you’re even running ads on Google, but now what?
How can you take your growth to the next level?
Lots of small and medium business owners are in this position. They have established something pretty solid, but they feel stuck. It’s like they’ve reached a ceiling and they don’t know how to move forward.
Many of them have a vague idea that if they were more tech savvy, if they knew how to use online marketing tools better and reach the right audiences, they could breathe life back into their sales.
If this sounds like you, we’re happy you found this post. We’re going to introduce you to some growth hacking principles that will help you get back on track and achieve your growth goals.
You don’t need to be a technical wizard to implement much of what you will read here (although tech skills never hurt). What you’re going to learn is a new approach to making business decisions based collecting rich and reliable data about your customers.
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The Origins of Growth Hacking
You might have heard of growth hacking before and had the impression that it was only for startups. Well, it started there, but the principles behind it are relevant to any type of business at any stage.
Growth hacking emerged out of the Silicon Valley startup world. With limited marketing budgets, business owners had to come up with innovative new ways to grow their businesses quickly and with minimal cost.
They did this by pushing the boundaries of what the traditional marketing text books taught. They actually mixed the discipline of marketing with those of data science and computer programming. This allowed them to come up with clever (and often very technical) growth “hacks” or tricks for boosting company growth with little expense.
Sean Ellis, the first marketer of Dropbox, was the guy who actually coined the term “growth hacker.” He realized at the time that what he was doing was more than just marketing--it was in fact a new function all together. (Read about the famous Dropbox growth hack here).
Growth hackers were marketers, data scientists, programmers and also product developers. They didn’t live within the normal organizational boundaries but got involved in whatever they needed to in order to achieve their growth goals.
Their tools included things like A/B testing, data analytics, SEO, SEM, landing page optimization and custom API’s. Their days were full of rapid experimentation, making constant iterations and adjustments until they figured out exactly what the most effective ways were to stimulate growth in any given context.
The fact that they lived outside the typical organizational boundaries gave them more freedom to do what they needed to do. In a traditional setting, product teams would hand “finished” products over to the marketing team, who would then be tasked with developing a market for it.
With growth hacking, products were never “finished.” They used the insights they gained from their extensive testing to constantly improve products and product offerings until they were perfectly tailored to their target customers.
People started calling this Marketing 2.0. It was a new, highly data-driven, highly targeted, highly effective way of gaining and retaining customers.
Growth Hacking Today
Many of the early growth hacks turned out to have a limited lifetime. When weaknesses in systems allowed for certain exploits (as in the famous Airbnb Craigslist hack), these were eventually blocked, making the hacks obsolete.
Other creative hacks were quickly adopted by the masses and lost their potency (like the famous Hotmail hack). Newly discovered hacks often became carefully guarded secrets until they were no longer effective.
As growth hacking became more popular, and as more people started writing about it, the common principles behind the techniques started coming to the forefront. It’s these principles, more than the specific techniques themselves, that continue to make growth hacking so lucrative and so effective.
The truth is that “silver bullets” like the hacks used by Dropbox or Airbnb are few and far between. Growth hacking is not magic. You typically don’t hear about all the hard work, and the many failures that came before the breakthroughs.
The good news is that growth hacking principles are timeless, relatively easy to learn, and if implemented with diligence can lead to extraordinary results.
We’re going to teach them to you (along with some techniques too).
Stop Guessing and Start Measuring!
If I were to ask you what the ROI was on your most recent marketing campaign, would you be able to tell me? Can you give a concrete figure for the Lifetime Value of your customers? What about the Cost of Acquisition across your various marketing channels?
If you are like most business owners, you would probably be hard pressed to give accurate answers to these questions.
It can be tricky even to know what to measure, much less how to do it. And once you learn how, putting that data to use is a challenge in itself.
One of the greatest pitfalls for businesses is that they base their decisions on intuition and assumptions rather than on solid data. We all tend to think that we know what people will want, what they will buy, and how best to reach them. Often we are wrong.
In the world of growth hacking, assumption is considered a bad word. Big companies might be able to afford huge marketing campaigns that rely largely on guesswork and aim for maximum general awareness. But for many startups and SMBs, a move like that could break the bank.
Growth hackers, by contrast, avoid guesswork at all costs. They are obsessed with data. They base all their marketing and product development decisions on the results of relentless experimentation.
By testing, measuring and analyzing everything they do to boost growth, they can optimize product offerings and marketing efforts. They can figure out what exactly constitutes the most effective and efficient ways to gain and retain high-value customers.
The last decade has seen the rise of many online tools that make running tests and collecting data possible without the need for much technical skill. Google Analytics and KISSmetrics, for example, can give you rich insight into your customer’s journeys. Tools like Unbounce allow you to create and publish landing pages with no programming knowledge whatsoever.
If you’re an entrepreneur, you probably already have the mindset, the drive and the passion to overcome the toughest of obstacles and carve out your success. But the truth is these traits are no longer enough.
It’s 2016, and the skills needed to succeed in business are different today than they were a decade ago. The companies that learn to harness the power of data are the ones that will continue to grow and thrive in the future.
Are You Listening?
The way most businesses have worked for years looks something like this: product developers would create something great, they would hand it over to the marketing team to figure out how and where to sell it, the product would launch, and it would sell like crazy.
Or, it would be a sensational flop.
Aspiring entrepreneurs followed pretty much the same model. They would have a fantastic product idea, invest a ton of time, money and energy into building it, bring it to market and see whether it would sell. Usually it wouldn’t.
In fact, the #1 reason startups fail is because they are offering a product that nobody wants.
There’s that bad word again. Recognize it? Assumption is the culprit behind most spectacular failures.
What if instead you started by listening carefully to your market and then tailoring your products and offers specifically to what customers are already asking for?
Sounds obvious, right? Most people forget this step.
How is this different than most new products? Don’t most successful businesses start with identifying a demand in the market and creating a product to fill that demand?
The difference with growth hackers is that they take this idea to another level. They are interested in specifics.
They start with a minimum viable product and they start to optimize every tiny feature based on how customers respond. Every word on a website; every inch of white space in an email; every product option remains under scrutiny until they have it exactly right.
And they do it by listening carefully to their markets. They go to great lengths to understand their customer’s hopes, dreams and desires, fears, doubts and hesitations. They use traditional market research techniques, but also other creative things like web scraping, forum mining and A/B testing.
How Is Your PMF Doing?
Once a growth hacker truly knows their customers, they can begin making adjustments to their product offerings, their websites and their marketing campaigns until they are perfectly in sync with their target market.
Eventually they end up with the perfect match. Product market fit (PMF) is what we call it. It means that your products and your markets are perfectly aligned, and it is the foundation for exponential growth.
How do you know when you have it?
The general rule of thumb (as given by Sean Ellis) is: When at least 40% of your customers would be very disappointed if they could no longer use your product or service, you probably have PMF.
Think about some products where you would be devastated if you could no longer use them and you’ll get the idea. (For me, I would be devastated if I could no longer use LastPass--in other words I have a pretty strong product market fit with them.)
Why is having PMF crucial to achieving exponential growth?
Because when people love your product that much, they will start to share it (like I unwittingly just did with LastPass). They will be eager to share it. And your job will then simply be to make it easy for them to do so.
A Paradigm Shift
Growth hacking is for all types of businesses. Startups, family businesses, corporations, even offline businesses. While there are many techniques to learn, internalizing the principles is where you should start.
Growth hacking requires a paradigm shift. It’s about leaving the guesswork behind and becoming a data fanatic. It’s about tracking and measuring all your activities so that you can optimize everything and focus only on what really works.
And it’s about listening, experimenting and adjusting so that you can tailor your products and product offerings to carefully match what your customers are already asking for.
Of course, there is a lot more to it. If you want to know more of the important principles that growth hackers abide by, check out our previous posts, especially the RockBoost 7 pillars of growth hacking.
Our next article will discuss some of the best tools you can use to bring these principles to life and start growth hacking your business.
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