Growth Hacker Marketing Creative and technology: awesome summary by ebookhike

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Author: Ryan Holiday

Growth Hacker Marketing: A Primer on the Future of PR, Marketing, and Advertising Ryan Holiday 2013

Growth Hacker Marketing

What is growth hacking? (Growth Hacker Marketing)

Growth Hacker Marketing: this is a way of thinking in which the main value is the constant growth of a business without spending a lot of money on marketing.

Growth hacking has been used and is still being used by Airbnb, Google, Slack, and other companies that create services and products that are popular all over the world. When they started, they didn’t have marketing experience, media connections, or big advertising budgets. Therefore, they had no choice but to change their development strategies and invent new ways of low-budget marketing. 

Many of these strategies and tactics have become even more effective than traditional ones. But the key was to change the very way of thinking, the way of doing business. It has the following principles.

Five principles of growth hacking:

1. Creating a product that is ideal for the market through constant testing, collecting feedback, and making changes to the product.
2. Use of low-budget but effective marketing.
3. Creating virality, when the product “sells itself”, even without paid advertising, when users want to share it with others.
4. User retention. Increase conversions and repeat sales. Building a community of dedicated users.
5. Constant experiments and analytics of results. Growth is never enough for hackers, they are always looking for growth.

Although growth hacking originated in the IT industry, these principles work for any business and any product.

Creating a product that perfectly fits the market

Traditional marketing involves the release of the final version of the product to the market. And the job of a marketer starts right before this release. A marketer does not participate in the planning and development stages, but deals with a ready-made product and cannot influence its quality in any way. He can only figure out how best to advertise what is, even if it is obvious that it is no good. And we are often talking about very large circulations.

Growth hackers believe that releasing a final version of a product without first testing it is a luxury. The risk is too great that the product will be unsuccessful, and unclaimed in the market. To minimize this risk as much as possible, you need to get feedback from potential users as early as possible, even before the release of the final product.

Therefore, a prototype is first created – a test version, a simplified model of the final product. It is also called the minimum viable product. It is released to a small market (for a limited number of users). Further, feedback from the first users is actively collected, and based on this, changes are made to the product. 

This cycle can repeat several times – each time an improved prototype is released and feedback is collected again. Until, finally, it becomes clear that the product really meets the needs of the market. This alignment is called product-market fit. Only after achieving product-market fit, the product can be released to a large market.

Airbnb started out as a small, local business in San Francisco. It was possible to rent only a room in the attic from the founders themselves – Brian Chesky and Joe Gebbia. Homemade breakfast was included with the night.

Growth Hacking Marketing

Very soon, Chesky and Gebbia wanted to scale the service so that other people could rent out housing using their site. At first, they thought to leave the key idea in its original form: renting a bed + homemade breakfast + networking and communication with the owners. But after testing and analyzing the needs of the market, they realized that not everyone needed breakfast and networking. What was really in demand everywhere was a simple opportunity to rent and rent housing.

Growth Hacking Marketing

Chesky and Gebbia changed the service – they removed the mandatory breakfast and networking, leaving the main thing – renting any housing (from an extra bed in the living room to a whole castle) in any part of the world. This is how they found their product-market fit.

Growth Hacking Marketing

Companies find product-market fit in different ways. Many people have to experiment for a long time. Others, like Airbnb, get it pretty quickly. Some even discover product-market fit by accident.

But even if the idea of ​​a great product that the market needs came about by accident, it still takes a company to work hard to achieve the perfect match. 

Achieving product-market fit is not just luck. This is not a matter of chance, but the result of consistent work consisting of constant testing, collecting feedback, and improving the product (and repeating this cycle many times). 

The product that eventually enters the market may be radically different from the prototype. What’s more, for growth hackers, feedback-based product changes never end, even after entering a large market. The product is constantly optimized, improved, and updated. For example, a book is updated with each new edition based on feedback from the previous edition. After all, achieving product-market fit does not guarantee its retention. The market is changing, user preferences are changing, and new competitors are emerging. It needs constant adaptation. 

In traditional marketing, if people no longer want to buy a product, the company changes its positioning, and advertising methods, but not the product itself. 

Growth hackers, on the contrary, believe that any product should be seen not as something static, but as a flexible model that can and should be changed. 

Traditional marketing forces sellers and marketers to prove the value of the promoted product, even if it, in fact, has little to no value. Growth hackers are on a mission to create products with real value that can be noticed and appreciated even without advertising. Ideally, they strive to achieve a wow effect so that consumers are not just satisfied, but delighted with the product. 

Achieving product-market fit is the most important thing for growth hackers. Without it, further steps are meaningless. Therefore, if the startup budget is limited, it is better to direct the bulk of the money to test and improve the product, and not to advertise it.

But it is important to note that in order to achieve product-market fit, you can not only change the product itself. If time and resources allow, we can work on changing the market, and people’s preferences. Or look for another market that your product suits better.

Attracting the first users

There is an opinion that it is worth creating a good, useful product and people will definitely find out about you. But this only works if the market is small. 

You have opened a barbershop in a small town. If it’s really good, people will quickly find out about it through word of mouth. 

Growth Hacking Marketing

But if the market is large and you want to attract a lot of users, the product needs to be promoted.

Internet entrepreneur and activist Aaron Schwartz created a similar online encyclopedia even before the advent of Wikipedia. And before came along, Schwartz also founded another online public campaigning service. But neither this service nor the encyclopedia became popular because no one was promoting them. 

Growth Hacking Marketing

Growth hackers believe that it is not necessary at the very beginning of the promotion to strive to communicate the release of the product to a large audience. A massive launch with a bunch of ads can be too expensive and have no effect. Therefore, instead of immediately increasing brand and product awareness among a large number of people, growth hackers start with targeting – they single out and try to attract the target, most interested audience. 

Targeting is based on a deep understanding of the client’s personality and needs. Growth hackers study their audience at the product-market fit stage and single out those people who need or like the product more than others. 

Who is your customer and where to look for him is a key issue for traditional marketing as well. But growth hackers are responding to it more precisely by actively using targeting and analytics tools. As a result, they use only channels with a high concentration of the target audience for promotion. 

Most people read major news sites and drive past billboards on highways. But for many businesses, hoping to attract a customer with a billboard is like looking for a needle in a haystack. In addition, according to statistics, in principle, people rarely pay attention to advertising on stands, billboards, in elevators. 

Growth Hacking Marketing

Where Growth Hackers Find Early Users:

1. Report the release of a full-fledged product to people who tested the prototype. They can become the most devoted fans of a product because they feel involved in its creation.

2. At thematic events (you can organize them yourself), in highly specialized media, and groups on social networks. Growth hackers are convinced that for any product you can find the right community – a place of high concentration of the target audience. And offer the product at the right time in the right place.

3. Collaborate with opinion leaders (bloggers, famous people) who belong to the target audience or have an influence on it.

4. Through crowdfunding 1This helps to solve two problems at once – to attract users and organize pre-sales (thereby receiving money for the development of the project).

5. Create high-quality thematic content that is interesting to the target audience (for example, expert articles for a blog and other media).

The main differences in user acquisition methods between growth hacking and traditional marketing are: 

1. Low-budget marketing instead of expensive advertising. Firstly, this saves money, which a startup usually has a little. Secondly, low-budget promotion methods are often even more effective than traditional ones.

2. Testing promotion methods. Growth hackers seek to acquire more users for less money, so they carefully track ROI 2 . After all, the advertising budget can be spent in different ways and with completely different efficiency. 

3. Free test versions or trial period of using the product. Growth hackers know that making a purchase decision can be difficult, so they don’t persuade users to immediately buy a product (which can be expensive), but offer to test it first for free. 

Growth hackers place a huge emphasis on connecting with users and solving their problems. This approach solves two problems at once:

 Obtaining feedback and keeping the product in line with market needs (product-market fit).
 Brand reputation, negative neutralization. 

Early adopters of the note-taking app Evernote complained that when they took notes during important meetings, their bosses thought they were just texting someone. Upon learning of this, Evernote released special stickers for laptops “I don’t get distracted, I take notes in Evernote!”. 

Stickers have become an original solution to users’ problems and at the same time an excellent promotion tool. After all, with them, users’ laptops turned into billboards telling the whole office about a new convenient application.

Growth Hacking Marketing

Creating virality

Growth hackers actively use viral marketing to encourage users to spread the word themselves and recommend the product to others. 

Viral can be:

 the actual product (so good that you want to tell others about it);
 content that distributes the product (unusual video, provocative photo session);
 promotion (“come to our cafe with a friend and get donuts as a gift”).

Information about a viral product, content, or promotion continues to spread even if paid advertising is completely disabled. 

Helps to achieve virality:

 Wow-effect. Achieved by exceeding expectations (“Did I really get such a cool product for only $5?!”, “What a cool idea!”). If something is admired, the likelihood that a person will recommend it to others increases greatly. And vice versa, an ordinary, boring product, promotion, or content does not evoke strong emotions and desire to share them. 

 Tools to facilitate the dissemination of information (referral links, discount coupons for a friend).

 User benefit. Previously, many companies gave the user a bonus if he told his friends about the product. Later, they began to give a bonus to both – both the one who recommends and the one who tries the product on the recommendation. This is more effective because it increases the motivation of both a new user (because he also receives a benefit) and an old one (he feels that he is benefiting another person, and not just earning bonuses from him).

It is easier for online products to achieve virality. Nevertheless, every company, of any size and format, has the potential for virality.

One barber in Michigan offered discounts to children who read a book while he cut their hair. The rumor about such an original, but simple way to get a discount quickly spread among parents, and the hairdresser’s clients became much larger.

Growth Hacking Marketing

Sometimes users spread information about a product unwittingly without thinking about it. The visual component (company color, logo, unusual shape) helps to ensure that people advertise the product simply by using it. 

Apple came up with an ingenious move when they decided to make branded headphones white instead of black. White is as versatile as black. But other manufacturers made their headphones black. As a result, Apple users were different from others and unwittingly became “live billboards” advertising the company’s products.

Growth Hacking Marketing

User retention

There is no point in attracting more and more new people if you manage to keep only a negligible part of them. This is inefficient because it is usually much more difficult and expensive to sell to a new client than to someone who was already interested in the product, and even more so bought it before. A business that cares more about attracting new users than retaining existing ones is like a sieve through which all the efforts of marketers flow. 

To retain users, growth hackers analyze their behavior and build sales funnels based on this data 3. 

Twitter had a problem – a huge number of people who registered out of interest did not use the service in the future. Behavior analysis showed that those who added 5 to 10 friends on the first day after registration were much more likely to become regular users of the service. They had a reason to go back to Twitter – to read the news of people they were interested in. Having figured out this pattern, Twitter began to actively suggest friends to each new user and remind them if the person did not add them right away. This delayed people and encouraged them to start using the service more actively. The churn of users has decreased. 

Growth Hacking Marketing

Sales funnel building tools:

 interactive and engaging instructions for using the product;
 reminders (by e-mail, by phone, using contextual advertising);
 bonuses that encourage you to return to use a product or buy another product from this seller (for example, coupons with a discount on your next purchase).

Experiments and analytics

Growth hackers are not very interested in abstract concepts like “branding” or “positioning”. Specific numbers, indicators, and ways to track them are important. Therefore, they test everything: products, promotion methods, ways to retain users, and increase conversions.

The best design for a growth hacker is not the prettiest, but the one that yields the highest conversion.

Growth Hacking Marketing

Growth hackers are never satisfied, they strive to improve performance and look for opportunities for growth at every stage of the company’s existence. Over time, many techniques that were previously successful become less effective, and you have to look for and try new ones. So growth hackers are constantly experimenting. For one successful experiment, there can be several unsuccessful ones. But lest mistakes become fatal, growth hackers don’t make their experiments large-scale and expensive. They run low-budget tests, select good ideas, and scale them up only after they are proven to work.

By the way, research and experimentation do not mean that growth hackers are eternal pioneers and come up with things that no one has ever done before. Most often this is impossible, most of the tricks have already been invented by someone. Therefore, growth hackers peep and copy ideas that are suitable for their business. Both competitors and entrepreneurs from other areas have life hacks that you can notice and try. Sometimes methods that at first glance seem banal and outdated become effective. 

For a local business, the good old flyer giveaway can still work great. 

Growth Hacking Marketing

Any technique that helps a business grow quickly can be considered growth hacking. 

Five steps and seven questions from Ryan Holiday

The steps that Ryan Holiday took in business:

1. Created a minimum viable product – a small e-book with basic ideas, which I sold for a very small price. If it had not become popular, the author would not have written and produced a longer printed version.

Thanks to the release of a small book, Holiday gathered feedback pretty quickly, without spending a lot of effort on it. Based on the feedback, he decided that it made sense to complete and release a full-fledged book, and also understood what exactly readers want to see in it.

2. Published a number of articles on topics from the future book in the media, popular among his target audience (marketers and businessmen). This contributed to securing his reputation as an expert and increasing his interest in the book.

3. Collected a list of ten thousand addresses for his e-mail distribution, in which he talked about books by other authors. Of course, he also used the mailing list to promote his own book.

4. Turned directly to growth hackers and marketers he knew personally and they helped him spread the word about the book in their professional communities.

5. Actively used the book itself as a marketing tool to promote his other products – training and courses. In particular, the publication of the book helped him sell himself as an expert in corporate training, which brought in much more money than the income from the book. 

At the end of the book, Ryan Holiday invited readers to get extra bonuses if they emailed him. Thanks to this, it was possible to expand the base of mailing addresses and continue to sell products to loyal subscribers.

Seven questions to ask yourself constantly:

1. Who can be the first user of my product? Who needs or is most interested in it?  2. What specific features and options do these people need? Which ones can I implement right now? 

3. Who are my competitors? How can I stand out and become more useful than them?

4. How to make users bring new users with them?

5. What questions might people have when using my product? (Answer them in advance, write and publish a detailed guide to using the product in the form of an FAQ – answers to basic questions.)

6. Am I willing to respond to feedback by changing the product?

7. What is a crazy, unusual idea that I can implement to grab the audience’s attention?

Top 10 Thoughts 

1. Growth hacking is a mindset in which the key role is played by: creating a product that perfectly fits the market, low-budget marketing, creating virality, and increasing conversions. All this is achieved through constant experimentation, testing, collecting feedback, and analytics.

2. Growth hacking involves the release of a test version, a product prototype. This allows you to collect feedback, improve the product and significantly reduce the risk that it will be unnecessary to the market.

3. Product-market fit is not achieved by chance, but through constant testing, collecting feedback, and changing the product. Moreover, this work does not stop even after entering the market. Growth hackers view the product as a flexible model that can and should be changed.

4. Growth hackers strive to create products with real value that can be noticed and appreciated even without advertising.

5. Growth hackers place a high value on connecting with users and solving their problems. This allows you to receive feedback and maintain product-market fit, as well as process the negative in time. 

6. You need to attract the first users pointwise, not on a large scale. You should not try to reach everyone, you need to look for the most interesting target audience. 

7. If the budget is limited, the bulk of it should be spent on improving the product, not on advertising. But you still need to promote the product, just use not expensive methods, but low-budget, guerrilla, and word of mouth marketing techniques.

8. Viral marketing can make a product popular without spending a lot of money. The following help achieve virality: wow effect (when a product or content exceeds expectations and arouses admiration), tools that facilitate the dissemination of information, and benefits (bonuses) for users.

9. User retention is just as important as user acquisition. After all, selling to a new client is usually much more difficult and expensive than to someone who was already interested in the product, and even more so bought it before. 

10. Any technique that helps a business grow quickly can be considered a growth hack. Sometimes methods that seem banal and even outdated at first glance become effective.

1 . A way of collaborating in which people pool money or other resources, usually over the Internet, to support a project.

2 . ROI is a measure of return on investment. If we are talking about investments in product promotion, then ROI shows how efficiently the advertising budget is spent.

3 . The sales funnel is a sequence of steps of a future buyer from the first acquaintance with the offer to the purchase. The repeat sales funnel leads the customer from the first purchase to subsequent purchases.

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