Growth Hacking For Dummies
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Growth hacking is the process of continually and rapidly testing, across the customer journey, to learn about activities that can be systemized as processes to grow the value that a business provides its customers.

A growth hacker is a person whose true north is growth. Everything they do is scrutinized by its potential impact on scalable growth. It is this person’s job to find scalable, repeatable, and sustainable ways to grow the business. This cheat sheet can help.

The basic growth hacking process

Before you think about growing anything, you must have a product that is growable. In other words, you must have validated the need for your product first (popularly known as product-market fit). You have no business (literally and figuratively) growing something that you have not confirmed, through testing and learning, that it’s something people want.

Check out this survey to help you qualitatively ascertain how close to product-market fit you might be.

Even before you get to product-market fit, you must know — or at least have a hypothesis for — the value your product provides. This starting point for all growth hacking activities serves as the first part of the growth hacking process. The process can be summarized as follows:

1. Identify your North Star Metric (NSM)

The NSM is the number that quantifies the value your product provides to your users or customers. Every product will have its own NSM because every product provides value differently. (Google provides value through search results, for example, whereas Lyft provides value with rides on demand).

  2. Analyze your growth model.

If every product provides value differently, then the way to grow every product also cannot be the same. Too many different variables are at play. So, you must understand what the customer journey looks like to be able to identify all the points within it that contribute to growth. (The customer journey, put simply, is the collection of interactions between your company and a customer over the duration of your relationship.) This analysis is based on quantitative and qualitative data to help you understand key points within the customer journey that represent the biggest opportunity you could exploit or the problem that, if you were to tackle it, could potentially lead to greater growth.

  3. Set objectives.

After you know what part of the customer journey you’ll focus on, set an objective on which to focus tests. Set a time frame of 30 to 90 days in which to test so that you can better understand the impact of your tests on your NSM. If NSMs are your long-term goal, then your objectives are your short-term goals. The quantification of any objective becomes your One Metric That Matters (OMTM).

  4. Build a backlog of ideas to test.

After you know what your objectives are, you need to come up with ideas — hypotheses, really — to test. Hopefully, coming up with new ideas is an ongoing process on your team, but every new objective presents opportunities to think anew about what options might be tried. Everybody on the team (and in the broader company) should be encouraged to contribute ideas to test.

  5. Prioritize ideas to test.

After you have a list of things you can try; you need to identify which ones might have the greatest potential. You can use any number of prioritization frameworks from the simple ICE (Impact, Confidence, Ease) score or others that require more data inputs that will help you pick the ideas with the best potential.

  6. Test your ideas.

More than anything else, growth hacking is about learning quickly what works and doesn’t work. So, when you test ideas, you perform a minimum viable test to learn whether it’s worth your while to continue testing in that area. This means constructing your test correctly with respect to hypotheses, any design, copy, engineering, and measurement specifications as appropriate and then launching the test effectively.

There are two types of tests: one where you find out what works, and another where you do more of what’s working to make it even better. Your first test where you’re trying to learn where to focus will be where you make big changes and gauge the impact. If you see promise in the results, you then make smaller changes around the area you made a big change to home in on specifics, that if you changed will be responsible for the positive results becoming even greater.

When anyone talks about testing, it’s always in the context of making a change to something, putting both versions in front of similar populations, and then observing the results of that change. That new version that includes the change is called a variant. Such tests are commonly referred to a A/B tests or split tests.

Popular testing tools, like Google Optimize or Optimizely make running tests easy.

  7. Analyze your tests.

Tests that you don’t learn from are useless. As soon as you have enough data, analyze your tests to glean the insights those tests have provided. You generally have three possible results:

    • Won: At least one tested variant showed a statistically significant positive improvement for the primary goal (and other goals, as applicable) over the original.
    • Lost: All tested variants showed statistically significant negative differences for the primary goal (and other goals, as applicable) compared to the original.
    • Inconclusive: All tested variants showed about the same performance — no statistically significant positive or negative improvement for the primary goal (and other goals, as applicable) over the original, in other words.

You’re trying to understand why a test worked or didn’t work or was inconclusive. What can you take away from the insights gained that you can apply to the next set of tests, irrespective of whether the answer is to double down on something that seems to work or move in a different direction?

  8. Systemize what works.

To capitalize on tests that have worked, you need to make them part of how you operate moving forward. Depending on the kind of test, you can do this in one of two ways: Make the change you tested part of your product by coordinating with the product development team or, if the test was a result of multiple steps — like generating content — create a process that represents a playbook that anyone can repeat in order to achieve similar results.

Since growth never ends, growth hacking is a continual process. As you continue testing against an objective and understand more about whether you’ve extracted the most gain from that opportunity, you’ll make decisions on whether to continue testing where you have been or to evaluate your growth model for new areas of opportunity and repeat the process over again,

The greatest growth hack you’ll find is building a culture of testing and learning. Creating such a culture is incredibly hard, and if you can pull it off, you’ll have put yourself in a position to provide even greater value to your customers than your competition can.

Key responsibilities of a growth lead

  • Understanding your NSM and building out a model for your product to grow.
  • Choosing which part of the growth model the company should focus on.
  • Not only managing the regular work of the testing process but also engaging cross-functional teams to participate in the program and creating a culture of learning companywide.

When you’re first getting a growth team off the ground — especially when you’re doing that at a start-up in its very early stages — the “head of growth” is likely to be the CEO or a founder. At other times, it’s a product leader or even the first marketer. But as the company grows, they will need other people dedicated to growth that may include a growth engineer, a growth designer, a marketing specialist, and a data analyst. Likely the growth engineer will be the first person that may be needed to implement impactful tests more quickly.

Who do growth teams answer to?

Research has shown that two major reporting structures exist for growth teams:

  • Independent-led model (Facebook, Uber) where the growth team is its own department and reports to a senior executive, who reports directly to the CEO.
  • Functional model (LinkedIn, Dropbox): where the growth team reports to the senior executive in charge, often, of product management

There is no significant difference between the impact of picking between the two models. Essentially, the model you pick is more a function of your company culture than anything else.

The customer journey

The customer journey is the path that someone who knows nothing about your product takes in order to find — and then use — your product. Visualizing the this for your product lays the foundation for you to collect data and audit the current state of your product’s growth. The two customer journey frameworks I’ve found to be most useful when getting started are the Pirate Metrics and Marketing Hourglass frameworks. They’re both slightly different but allow you to ask the same questions.

  • How are your prospective customers finding out about your product?

Will people finding out be a function of paid marketing that raises awareness or more organic means based on their needs or a combination of the two? What channels work best?

  • What convinces your prospective customer of the value of your product?

What is the sequence of steps or actions that makes the lightbulb go off in your future customer’s head that your product is the one they need to achieve their goals? What is that “aha moment”?

  • How do your customers continue experiencing the value of your product?

What is the mechanism by which you build the habit for your product with more people so that they cannot live without your product? Cohort analysis, where you break up users into groups based on similar characteristics like when they signed up or what marketing channel they came from and look at how they behave to understand if certain characteristics correlate better to being retained as a user or not.

  • What gets your customers to talk about your product with others?
    People trust recommendations now more than ever. How do you convert your fans into a marketing channel that will attract more people that will find value in your product? How do you make it easy for them to talk about you?
  • What gets your customers to pay for your product?

Here you draw correlations between feature usage and the value those features deliver with hypothesis for pricing and test that quantitatively and qualitatively to find out the sweet spot at which paying for your product becomes a no-brainer.

Analytics tools that allow you to get an aggregate picture of the customer journey (e.g., Google Analytics) and at an individual user level (e.g. Amplitude) will be critical to understanding your customer journey and steps within it that hold the greatest promise for growth, or what may be blocking it. Understanding this allows you to run tests to understand how to capitalize on this information to move users towards experiencing the value of your product more often.

Manage the growth process

  • Weekly Routine:

When you’re just starting out and you’re trying to build the habit of weekly (or bi-weekly) testing, don’t make the effort too difficult for yourself. Start with the goal of getting a single test launched every week. It may help to start with “easy” tests that you can do on your own — changes in website copy, for example, or email subject lines — to learn how to construct a test properly with the right hypotheses and to analyze them correctly.

As you become more comfortable running one test every week, add more tests, understand what prevents you from launching more and address those issues, sometimes with assistance from senior management (see the next section for more on this), until you can establish a testing routine of 3+ test per week.

Host a growth meeting every week (or bi-weekly) attended by the growth team and all major stakeholders or department leads. Its purpose is to look at the company’s North Star Metric trend, objective metrics, tests launched since the last meeting and learnings from completed tests to understand why the numbers are the way they are and what needs to be done next. Every meeting has a set agenda and format focused on learning to keep everyone on track and make the most of the meeting. Use a central, shared space that can host the backlog of ideas, key metrics, status of tests and learnings and create the expectation that everyone attending the meeting should be familiar with these items before attending growth meetings for them to be as productive as possible.

  • Monthly Routine:

The 30-day mark is a great point at which to reevaluate whether there’s a meaningful movement in your objective metrics and your NSM to continue the current testing focus. If you see a positive sign, continue testing for another 30 days and re-evaluate. Repeat this until you get to the 90-day mark. In most cases, you will have squeezed out the majority of the big gains from your area of focus by this time and will have to make a call on whether it’s worth continuing testing for small gains or move to another focus area that may hold larger gains.

  • Quarterly Routine:

The health of your growth process is a function of how many tests you launch week after week, your learning rate, your win rate, and how well you enable your team for success.

You should be able to tell is whether you’ve been able to run more tests over time. If you’ve been able to do this, it also means that you’ve been able to generate more ideas as a team.

As you run more tests, you’ll gain more insights and collect more data. As your learning rate increases, your hypotheses for follow-on tests should become more accurate.

As you grow comfortable with testing, you may find that people on the team need to develop newer skills, or that you need someone else to join the team to become even more efficient. Similarly, you’ll find that you need more tools and technology to develop better insights and reporting as you run more tests and discover new opportunities. So, part of this exercise is also being open to optimizing your team’s capabilities on an ongoing basis.

Get Everyone in the Company to Participate

It’s not an understatement to say that if your growth team is going to gain acceptance and succeed at what it does, it’s because your team excels at sharing the insights it gains with the rest of the company. The trick to getting everyone in the company excited about this lies in making sure the CEO and the executive team are excited about the growth team’s work.

As you test and learn, share weekly, monthly and quarterly updates on the most impactful learnings with the company. This allows everyone to understand the impact of testing and provides fodder for the broader organization to suggest more ideas to test, turning growth into the team sport it is meant to be.

Fostering a culture of growth is an ongoing process that takes a lot of work. By design, it makes some people in the company uncomfortable, and it certainly forces people out of their comfort zones. And, of course, you’ll fail. A lot. But if you want to achieve cross-functional collaboration around growth, happier customers, and more value delivered to them, you have no choice but to go down this path. Building this culture takes time, but it’s the way to unlock growth.

About This Article

This article is from the book:

About the book author:

Anuj Adhiya learned growth hacking as a community moderator and then Director of Engagement and Analytics at GrowthHackers (founded by Sean Ellis, who coined "growth hacking"). He's mentored and coached a number of startups on the growth methodology at Harvard Innovation Labs & Seedstars. He's currently the VP of Growth at Jamber.

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