When Does Growth Hacking Make Sense
These days, it’s almost impossible to talk about marketing without mentioning growth hacking. When you find out what growth hacking is, then it sounds like something that almost all startups should be doing. After all, isn’t growing a significant part of the success of your brand?
While growth hacking certainly has its merits and benefits, that doesn’t mean that it’s right for everyone. Yes, growth is an integral part of any business model, but hacking your way to the top isn’t always the right move. Perhaps you’re not ready for growth hacking yet, or maybe your enterprise would stumble or fall with such rapid expansion.
So, with that in mind, we want to look at when growth hacking makes sense. We want to see the conditions necessary for this tactic and whether it seems right for your brand. Also, even if it doesn’t look like the right move right now, that doesn’t mean that growth hacking isn’t going to be in your future.
Are You Ready for Growth Hacking?
It’s so easy to look at the explosive growth of brands like Airbnb and Dropbox and assume that your product or business is ripe for the same kind of aggressive expansion. However, if you’re not prepared for growth hacking, then it could be detrimental to your success, rather than propelling you towards the future.
Although each brand is different and the details are going to change based on your particular circumstances, we want to try and hammer out a checklist of readiness that will help you figure out if growth hacking is suitable or not. Once you’re able to check off each section of the list confidently, you’re ready for the big time.
Do People Love Your Product?
One of the most crucial aspects of growth hacking is the ability to get people to refer your product or service to others. Brands like Uber or Airbnb would not have had the massive growth and success that they achieved if they didn’t fulfill a need within their respective markets and generate a ton of buzz among their user base.
Simply put, if no one cares about what you have to offer, then how can you even attempt to hack your way to growth?
Do You Know Where You Want to Go?
One of the issues that many companies have with growth hacking is that they look at it in the broadest possible terms. However, growth can mean a lot of different things, depending on what your business model is and what you’re trying to achieve.
For example, if you have an app, then you will want not only to increase the number of people downloading it but the number of users keeping and using the app on a regular basis. Until you know what kind of growth you’re hoping for, it’s impossible to define whether or not you’re ready to achieve it.
Do You Have a Scalable Product?
One thing that almost all growth is hacking success stories have in common is that they are products or services that are easy to spread around quickly. Things like Facebook and Hotmail are straightforward to expand — all it takes is more servers to process the data, and you’re ready to go.
However, if your business model relies on producing more products and you’re not poised for scalability, then growth hacking won’t be possible, no matter how much people love what you have to offer. For example, if you’re selling appliances, then rapid expansion means that you need to secure the means of producing those appliances at massive quantities. Until that occurs, you’re stuck.
Do You Know Your Customer Base?
Again, one of the problems that businesses have with growth hacking is that they think it’s a magic bullet that can help them reach untold levels of success. However, it’s imperative that you understand that it’s a process like anything else, which means that you have to have the right tools and mindset in place before you begin.
One of the more crucial elements of growth hacking is understanding your user base. By having a laser-focused approach to marketing to one or two demographics (beyond simply young males or something like that), you can achieve greater success because you’re able to tap into their needs much more intuitively.
Simply put, if you’re trying to appeal to everyone, then you’ll wind up reaching no one. Knowing your customers will help you get to the next level of growth.
So, to recap, before growth hacking can begin, you need the following elements:
- A product/service that people love to use (filling a need)
- A way to measure success and growth (metrics and analysis)
- A scalable product or service
- Focused attention to detail regarding your user base (buyer personas)
Once you know that all of these components are poised for growth hacking, you should be ready to proceed. However, remember that it’s not a magic bullet — you need to follow specific steps to ensure that your growth is not only well managed but that it is sustainable.
Is Growth Hacking Right for Your Business?
As we mentioned at the beginning, growth hacking may not be the best answer for your brand. Just because it worked for someone else doesn’t mean that it will work for you, so it’s imperative that you figure out whether hacking your way to the top makes sense before putting too much time and effort into a growth hacking strategy.
Here are some reasons you may not be ready for this process.
You’re Not Gaining Traction With Your Current Base
Even if you’re a brand-new startup, you should already have people using your product or service. Whether it’s a few hundred customers or just your inner circle, data from a handful of people are just as valuable as it would be from thousands of users.
Unfortunately, if you’re not able to generate buzz and excitement from your current base, then growth hacking is not going to be right for you. Not only will it be much more difficult to experience rapid expansion if your customers don’t care, but it could lead to a lot of wasted time and energy if you attempt growth hacking with a subpar product or service.
However, how do you know if your product is gaining traction? How can you be sure that your current user base isn’t energized?
It’s easy — ask them.
One of the simplest and most effective ways to see if your product has value is to ask the people using it if it does or not. If they use it every day and they feel like they can’t live without it, then you know you’re in the right place for growth. If they barely use it or have no desire to keep using it, you should probably go back to the drawing board.
You Don’t Have the Right Tools for Tracking Metrics
One of the most crucial elements of any growth hacking campaign is turning your growth into tangible numbers. How many new subscribers do you have? How many people downloaded your app in the last day, week or month? How many of those downloads were based on referrals? How well is your lead funnel working?
If you’re not sure how to measure success, then no amount of growth hacking will work. Unless you can see whether you’re tactics are having a positive impact on your customer base, you’ll have no chance of achieving the growth you want.
While these metrics can be easy to attain for some products, it’s much harder with others. Thus, until you establish a reliable method for viewing and tracking the metrics that matter the most, you’re not ready for growth hacking.
You Don’t Have the Right Foundation
No matter what kind of business you have, you need to make sure that the foundations of it are stable before you even attempt any growth. After all, how can you build something meaningful if you don’t have anything sturdy upon which to make it?
For many startups, the rush to achieve growth can sometimes come at the expense of the business itself. If your foundation is shaky at best, then rapid expansion will only create problems and potentially cause your business model to implode in the process.
Thus, before you get started, you want to make sure that your business model is strong enough to withstand massive growth. Build systems into your brand that will help you stay stable as you grow — otherwise, it could be unsustainable.
Your Market is Too Narrow
Yes, every startup and business wants to achieve unlimited growth potential, but the fact is that you may be in more of a niche market than you realize. When developing things like buyer personas, you want to think about how many of those people are out there and whether you can even experience the type of growth you’re imagining.
For example, if you have a product or service that is highly valuable to recent divorcees who have dogs, then you have to consider how many of those even exist. This is a hyper-specific example, but that’s the point. While focusing your attention on a particular demographic is essential for growth hacking, it won’t work if that demographic is too limited in size and scope.
How to Get Ready for Growth Hacking
So you’ve taken a hard look at your product and your business model, and you believe that growth hacking is a viable strategy for success. However, how can you be sure that your brand is ready for this kind of expansion?
Here are some ways that you can build a strong enough foundation to experience the level of growth hacking that you want.
One of the most fundamental aspects of building a business (of any size) is making sure that your enterprise is running efficiently. If you’re disorganized, then growth is going to put too much pressure on your business, and it will crumble under the weight.
The great thing about getting organized is that it not only helps solidify your foundation for growth hacking, but it helps your overall business model. The more that you can streamline your operations and make things work more efficiently, the better off you’ll be, with or without rapid growth.
When talking about organization, consider things like -
Allocation of Resources: what resources are at your disposal (i.e., personnel, capital, infrastructure, etc.) and what methods do you have to move them around? If you need more people in a particular department, what steps can you take to either add more staff or restructure your current roster to fit your needs?
Metrics and Analysis: can you already measure the parameters that you value most? If not, what’s holding you back from seeing the numbers that matter to your brand? Until you’ve mastered a way to see what’s happening in your business, you won’t have any way to know if your tactics are working.
Management: all too often, what spells doom for a startup (or any business) is lack of leadership and management skills. Either there are too many cooks in the kitchen, or no one is taking a broader view of things — in both cases, lack of active management leads to disaster.
Overall, getting organized is all about making sure that you’re heading in the right direction. Without the proper tools and systems in place, then your growth could be too erratic to be meaningful, or it could be moving in a direction that may be unsustainable. An organization is going to help you get a clearer vision of where you are and where you’re going.
Separate Growth Hacking From Regular Marketing
Another way that businesses can falter with growth hacking is that they don’t understand how it differs from traditional digital marketing. While both tactics are similar (i.e., they are helping the business grow), hacking is only about growth, while other marketing can be more subtle or ambiguous in its results.
Thus, if you want to make sure that you’re ready for growth hacking, you need a team that is dedicated to it. This way, you can be sure that you’ll have the right focus and energy propelling your business forward.
Finally, growth hacking is all about experimentation, which means that you have to break the mold and attempt new things that you may not be familiar with at first. Unfortunately, many startups and businesses allow this flexibility to derail their organizational capabilities and foundations, but that’s a huge mistake.
Instead, you want to bake flexibility and experimentation into your growth hacking process. As you try new approaches, be sure that you can measure the results immediately and efficiently so that you can see if it’s worth pursuing further or if you need to shift gears instead.
Also, flexibility is all about adaptation. One growth hacking tactic may exploit a loophole in a particular system (like Airbnb using Craigslist), which means that once that loophole is closed, you have to try something else. Also, if you realize that your product or service resonates with a different demographic than you intended, you have to be able to shift to meet their needs to continue that same momentum.
Bottom Line — Are You Ready?
Let’s review our growth hacking checklist again to see if you’re poised for expansion or not.
- Is Your Product/Service Desirable?
- Do You Have a Clear Roadmap for Growth?
- Do You Have the Necessary Tools to Monitor Your Growth?
- Are you Organized Enough to Handle Growth?
- Are You Able to Scale Up to Meet Demand?
- Are You Focused on Your Approach?
If you feel confident with each of these aspects, then you should be ready to go. If not, then don’t despair, focus on getting to a launching point and the rest will be history.
Click here to learn more about the 10x growth narrative
Originally published at https://medium.com on May 11, 2019.