Sometimes, young entrepreneurs with little or no budget at all, working on an idea from their houses, their garages, or from a library that in a few years - in some rare cases even months - will create an idea that will turn out to be a billion dollar corporation. This was the case for startups like Dropbox, Uber, AirBnb, Buffer, Snapchat, etc. that achieved fast and large business growth with techniques that marketers wouldn’t even call marketing. Those individuals – often without any knowledge of marketing and business development, but just with programming skills – have achieved, in a short time-frame, what established companies couldn’t achieve in decades even though they would have the marketing preparation, business knowledge and financial capabilities to do so.
The term Growth hacking was coined in 2010 by Sean Ellis to describe “a process of rapid experimentation across marketing channels and product development to identify the most effective, efficient ways to grow a business.” Growth hacking is a type of marketing with a unique goal: to grow a target audience in record fashion on a limited budget. Edward Swanson, the COO of a world renown tissue engineering platform PolarityTE, says that “the limited budget makes startups look for alternative ways to run their campaigns and thus, this leads to changes from the common business growth methods.”
Growth hacking is a data-driven initiative shared through low-cost channels in order to achieve measurable jumps in metrics with the product serving as the distribution channel. Growth hacking techniques are employed by startups trying different strategies until one works and is suitable is discovered and further utilized.
For many marketer, growth hackers, using tactics that before no one would have even described as "marketing”, has turned out to be marketing “on steroids” and a more effective way for approaching digital marketing campaigns.
Is growth hacking an evolution of traditional marketing approaches or an revolution?
Growth hacking is often presented as a revolutionary secret formula to business growth. In some cases, this is presented as the New Testament of digital marketing or, even, this is introduced in some publications as “the death of digital marketing.”
However, it shouldn’t be forgotten that growth hacking – just like any new term launched in the market marked as revolutionary - is indeed a commercial buzzword. Bloggers love to write about the legendary stories of the successful business growth of AirBnB, Uber, Hotmail, etc. because that’s what their readers like to hear, and books continuously rehash those stories because it helps sales. However, you don’t hear about other startups that did great hacks but never seem to take off. From those success stories you might conclude that growth hacking is really the key to success; however, by merely looking at the success of those companies you miss the fact that many similar hacks were also done by other companies and they have never reached full scalability.
In his book The Growth Secret Roberto Liccardo discuss how growth hacking is neither an evolution nor revolution of traditional marketing, but rather a complementary skill-set that digital marketers should have and that they should apply to bring growth into any organization, regardless of its size. The book also presents an unprecedented analysis of how startups in various sectors achieved breakthrough growth to serve as a guideline for aspiring and experienced growth seekers. The analysis results revels how business growth – as well as business failure - seems to follow common patterns that successful startups in a certain industry share.
New “old” strategies for business growth
No matter how you feel about the new methodologies coming up along the way of the business growth evolution, it is undisputable that strategies for achieving business growth have evolved and changed. People are consuming everyday more digital content, the traditional advertising billboards and pay per click market has almost reached a level of saturation, and every year it is registered an a increase of 21% new active social media users. In this scenario doesn’t surprise that consumers’ behavior has strongly changed. In the past, growth was depending on how many people you reach: a large reach would normally convert to a large number of buyers. Nowadays instead, you may reach hundreds of thousands of people and get a few hundred sales out of it; it is much more about how you reach them. The key metric to measure the base of any growth initiative is “conversion,” and if you should choose in between reach rate or conversion rate, you definitely would want to choose the latter.
According to the Cambridge Dictionary, an influencer is “a person or group that has the ability to influence the behavior or opinions of others.” That is nothing new, as we all know that since commerce started, there is an added value if a person you know or even better a person you consider as an expert on that field refers you a product rather than buying a product you have seen on an advert. However, what’s new about this old formula is its present implementation. Social media has amplified this concept to its extreme: re-sharing information, liking a post, connecting and even following a person.
It is obvious that business growth relies on people much more than the past, and much more than the past new strategies along the way that emphasis on sharing and viral marketing have proven to be successful. Subject experts, Influencers, brand ambassadors, crowd funding, referrals, social interactions – you name it, all concepts that have people and relationship has focus.