If you’re trying to drive growth for your business, you might have heard the buzzword “growth hacking” being thrown around. But there’s no actual “hacking” involved in growth hacking; it’s just data-driven marketing being used as a method to optimise demand generation, which is why growth marketing is a better name.
Much like growth hacking promotes constant optimisation within a product roadmap, growth marketing transforms pre-defined marketing calendars into ever-changing, personalised lifecycle messaging. In fact, over the past decade, growth marketing has taken centre stage in place of traditional marketing as a direct consequence of the internet age we live in. How? It all comes down to data.
As businesses move more of their marketing activities online, whether through digital advertising, social media marketing, email marketing, or search engine optimisation (SEO), the result is a wealth of data about online consumer behaviour: what they click, which emails they read, which products they buy, how much time they spend on a web page and so much more.
What if there was a way to use this data to improve your marketing activities and fine-tune them constantly over time to get better results? What if you could hack your online campaigns to get more customers, more clicks, more conversions, more sales?
Welcome to the world of growth marketing.
What is Growth Marketing?
Growth marketing isn’t about fixating on one part of your funnel. It’s about looking at your entire customer lifecycle and using those insights to create compounding returns that drive more engaged customers.
Growth marketing is a data-driven approach that uses tests to determine how to optimise results. For example, using an A/B test to see which push notification users like better. When something works, it’s leaned into. When something doesn’t, more tests are run.
Traditionally, marketing efforts have been separated from the product, with the marketing department isolated from other aspects of the business. Today, growth marketing is integrated within product development. Growth marketers must dig in and immerse themselves in the growth metrics that matter.
Although the name growth marketing implies a strategy based entirely on attracting more users, it’s about more than just that. The seeds of growth marketing must be planted in the customer discovery process.
Customer discovery is exactly as it sounds: discovering who is having the problem that your product can best solve, also known as product/market fit. A deep understanding of who the customer is can also guide the growth marketing strategy to best address the goals of the company.
3 Goals of Growth Marketing
As the business scales, growth strategies become more efficient both from a cost and conversion rate perspective. But how can one expect to attain each of these overarching goals from growth marketing?
1) Customer Retention
Possibly the most important goal of growth marketing is to retain existing customers.
The satisfaction of existing users should be prioritised to ensure loyalty to your company’s product or service. Since there is less friction when repeating a purchase, it is far easier to sell to an existing customer than a new customer.
Areas to test include:
- Incentive programs
- User onboarding
- Email triggers
2) Customer Acquisition
After customer retention has stabilised, the pursuit for new customers becomes financially feasible. The acquisition of new customers is the ability to successfully reach new users and convince them to purchase. One of the tenets of customer acquisition is visibility within the marketplace. Where are customers searching for a solution to their problem, and where does your solution meet them during this search? Understanding how your customer acquisition strategy aligns with customer retention can signal sustainability.
Areas to test include
- Social media
- Paid search
- Free trial period
3) Increased Profit
Ultimately, if your growth marketing strategy is not sustainable, your revenue may increase while profitability decreases. How can this be? If customer acquisition costs exceed the lifetime value of customers, no matter how exponential revenue growth may be, the economics of the business model will never recover.
A successful growth marketing strategy will provide new sources of revenue without putting an unnecessary burden on expenses. If executed properly, the retention rate will outpace churn, therefore increasing customer lifetime value.
Areas to test include:
- Annual billing
- Customer surveys
- Bundled package offerings
3 Core Components of A Growth Marketing Strategy
Now that we’re covered the 3 goals of growth marketing, here are some of the leading tactics that today’s growth marketers use to attract, convert, create, and retain engaged customers. All of these tactics are used frequently in the e-commerce space but can be useful for brick-and-mortar businesses, too.
1) A/B Testing
A/B testing, or better yet, multivariate testing, is one of the core practices of a strong growth marketing strategy. It can be used in a number of formats, including email marketing, landing pages, social media ads, and others. This involves deploying either an “A” and a “B” test, or a series of multiple tests, to understand which variation of your content (with customisations around graphics, copy, design, and other features) does a better job of engaging your audience and increasing your conversion rate.
You can then optimise future marketing campaigns around that variation—continually iterating on your successes to enhance performance with every test. It’s important to remember that just because the “B” test proved most effective with one audience segment, “C” might work better with another: Don’t just send your A/B tests out in batches; focus on customised segments for each ones to understand what content resonates with that particular audience group, and then keep testing new variations to enhance performance.
2) Cross-channel Marketing
Cross-channel marketing focuses on building a strategic channel plan to reach your customers, and can include email marketing, SMS messaging, push notifications, in-app messages, and other channels, based on your audience’s preferences. When incorporating a cross-channel marketing plan into your growth marketing strategy, you need to focus on the individual user to understand their communication preferences and then build your campaigns accordingly.
It’s also valuable to build a holistic marketing plan that integrates multiple channels so that you will be able to engage with your audience wherever they are, using contextual campaigns that help you understand their past behaviour across each platform.
3) Customer Lifecycle
A customer lifecycle is the journey your customers embark on as they learn about, interact with, buy or convert, and re-engage with your company. For simplification, there are three critical lifecycle stages that growth marketers focus on: activation, nurture, and reactivation. Each stage plays a specific role as a contributing factor to customer experience and is often marked by specific campaigns.
The activation stage is the initial stage of the lifecycle where companies seek to activate consumer attention and interest. Growth marketers target customers with welcome, onboarding, trials, and other introductory campaigns to build familiarity and credibility.
The nurture stage is where companies nurture and engage consumers to strengthen relationships. This stage typically accounts for the majority of cross-channel marketing customers receive from brands: sales, promotions, recent updates, newsletters, and more.
The final reactivation stage focuses on re-engagement. It’s this stage where companies reactivate customer engagement to drive retention and loyalty through campaigns like post-purchase, abandonment, loyalty or win backs.
No single stage outweighs another in terms of importance. Customers naturally progress through this lifecycle at their own speed, but growth marketers proactively accommodate their changing needs using an arsenal of need-specific campaigns.
Today, we have the tools and technologies to make every marketer a growth marketer. Your focus should be on continually testing and optimising for higher engagement and better customer experience, using strategies to attract customers based on highly personalised preferences. Make sure that, as you experiment with new strategies, you’re constantly collecting data as you go, so that you can build, test, and iterate along the way to continually enhance the customer journey.
To gain the necessary skills to be a growth marketer, check out our 2-day course on growth marketing.