Growth Hacking vs. Traditional Marketing
We hear lots of business writers, entrepreneurs, and other (regular) human beings expressing doubt and confusion about the difference between growth hacking and marketing. Some say growth hacking is a breakthrough new field. A new profession. Others are saying it’s nothing more than run-of-the-mill marketing, re branded.
So, who is right here?
As experienced growth professionals, we’re going to break it down and give you ourversion of the answer.
The Short Answer
Although marketing and growth hacking certainly have some overlap, they are far from the same thing. Practitioners may share some techniques, but in reality they have fundamentally different goals. Both growth hackers and marketers work to understand, acquire and retain customers, but their perspectives and approaches differ. Each has a different ultimate purpose within an organization.
Marketer: Someone who aims to sell particular goods and services to their target group.
Growth Hacker: A person whose true north is growth. (Sean Ellis)
To start with, growth hackers are typically found at startups (although larger companies are increasingly getting on the ball as well).
Startups often have miniscule marketing budgets and are dependent on growth for survival. Over the last decade, these pressures forced many companies to take more innovative approaches, often harnessing the power of technology to find new ways to grow without much expenditure.
For some companies it turned out to be the programmers, not the marketers, that were able to find the most creative and cost effective methods for scaling up.
Growth hacking was born out of this high pressure startup environment.
While marketing is all about selling a company’s products and services, growth hacking is a more holistic function. Growth hackers are not just focused on sales, they are focused on business growth — no matter what that takes. It might include creative marketing, but it may just as easily extend to product development and user testing.
Markters try to sell a finished product. Growth hackers help to design a product based on what customers are asking for.
Then there come the technical skills.
Online data analytics, programming and automation are essential elements in the growth hacker skillset. While nowadays most marketers have at least some online marketing ability, growth hackers are typically more skilled in things like A/B testing, creating custom landing pages, behavioral tracking and analytics reporting.
That is not to say that every growth hacker is an expert in each one of these skills (a growth hacker’s skillset is in a t-shape). But any competent growth hacker should have a good understanding of what tools are available and how they can be used.
A growth hacker knows how to measure everything they do. Their days are full of rapid experimentation and optimization. They know how to collect data and how to turn data into actionable insight.
Gone are the days of wondering about the ROI of your last ad campaign.
Growth hackers can track a falcon on a cloudy day. They are the Prince Humperdinck’s of the online world… Ok, that’s not the most flattering description I’ve ever come up with, but you get the point.
By the end of this article, you will have a concrete understanding of the differences between traditional marketing and growth hacking, and in what context each profession is needed. If you work in marketing, you’re going to learn why you need to start incorporating growth hacking principles into your strategy today.
A Different Mindset
Zeroing In On … What?
Exponential business growth is the holy grail for any growth hacker.
Through working in challenging environments and by utilizing systematic experimentation, they have learned to find the most effective and efficient ways of achieving growth.
Marketers are accustomed to rolling out high exposure, high cost campaigns on billboards, front-page ads, and prime time media spaces. Growth hackers, on the other hand, are always on the lookout for small but powerful “hacks” — unconventional “tricks” or “shortcuts” with high potential and low costs.
Marketers often spend big but frequently lack the means or the tools to measure a given campaign’s ROI. They aim to achieve maximum awareness, hoping to get on the evening news, but have little idea as to the effectiveness of specific campaigns. The more awareness they drive, the more they feel like they’ve succeeded.
It’s not that awareness is bad. And it’s not that marketers are doing a bad job — they are probably doing exactly what their bosses expect of them.
But this shotgun approach is not always the most effective. Advancements in technology now allow us to get a clearer picture of what exactly drives conversions, and thus tells us what exactly we should focus our time, energy and money on.
Growth hackers are only interested in what works, and they’ll keep testing until they find out what that is. [Tweet That!]
They know it is not about the size of their reach, but about its effectiveness. In the end it doesn’t matter how many people have heard of you. What matters is that theright people know about you: the people with the highest potential to become loyal customers.
Who’s Got the Data?
Growth hackers are obsessed with data.
Every potential business move starts as a hypothesis. Every option is tested with data. Every decision is based on the results of relentless experimentation.
Where traditional marketers tend to base decisions on textbook theory, growth hackers use a data driven approach to everything they do. This means there is no room for assumption. It means that everything needs to be measurable, trackable and calculable.
Many marketers run social media ads because… Well, because who doesn’t run social media ads? However, they often fail to measure (or don’t know how to measure) key metrics, and thus don’t actually know whether their social campaigns are really worth the time and money invested.
Without detailed tracking and measurement, you can never know for certain the key driver(s) of your success or failure.
It’s not like marketers don’t realize this. According to one HBR study, approximately 80% marketers were dissatisfied with their ability to measure the ROI on their campaigns. However, organizational pressures and job descriptions often don’t allow marketers the freedom to ask “Where else could I be focusing my energy to achieve more?”
Growth hackers don’t typically run large, static campaigns, and thus don’t work with ROI. Instead, they use Customer Lifetime Value and Cost of Acquisition as metrics to constantly adjust and optimize their marketing channels.
The Magical P.M.F.
Traditional marketers typically receive a product from a development team and then are tasked with developing a market for it. Part of what makes growth hackers so effective is that they don’t live within these boundaries.
Growth hackers should already be participating at the start of the product design phase by building growth into the product. Through extensive user testing, data mining, and other ways of listening to the market they can help develop or improve the product by tailoring it specifically to what customers are already asking for.
When this happens it’s called product/market fit (PMF), and having PMF is the foundation for growth.
The rule of thumb is this: When at least 40% of your users report that they would be very disappointed could they no longer use your product or service, you probably have PMF. It means that your product — and the market for your product — are perfectly in sync.
The growth hacker’s goal is to create a product their customers cannot live without. When growth is your top priority, all options need to be on the table including the willingness to take the product back to the drawing board.
Growth hackers get involved in product development and they work to constantly improve the product over time according to the results of their tests.
Traditional marketers aim for high awareness and higher acquisition. They create the market and bring in the customers. After that, their job is done. Another department focuses on retention.
Again, the growth hacking approach transcends these boundaries.
Growth hackers are concerned with closing the loop. Most startups don’t have the resources to pour water into a bucket with holes in the bottom. They are concerned with customer’s lifetime value. As such, they work to optimize the entire “AARRR” sales funnel (we like to refer to this as Pirate Metrics, first developed by Dave McClure):
Awareness: How do customers find you?
Activation: Creating a WOW moment that inspires them to take action.
Retention: Stimulating them to come back.
Revenue: Optimizing revenue streams.
Referral: Making customers so happy that they become your sales force.
By measuring each part of the sales funnel, growth hackers can see exactly where your customers are struggling, where they are leaving, and what can be done about it.
The Growth Mindset Infographic
A Different Skillset
Moving beyond mindset, there are also big differences in the skillsets of a traditional marketer and a growth hacker.
Traditional marketers associate themselves more with artists. They are concerned with strategy, brand building and sales.
Growth hackers trace their roots back to programming engineers. But they are much more than that. Data scientist meets marketer meets programmer.
The growth hacking skillset should include 3 essential elements:
1) Creative marketing: A growth hacker needs to know how to creatively market products. Having a background in marketing is always an asset. Understanding customer needs and how to fulfill them is essential.
2) Data Analytics & Testing: Everything that is done to boost growth needs to be measurable. That means a growth hacker needs to know the tools and techniques for collecting and analyzing lots of data.
3) Software Engineering & Automation: Growth hacking is often a very technical job. It sometimes involves programming custom APIs, setting up landing pages, or coming up with other creative software based hacks.
Few people are experts in everything. That’s why having a stellar team is so important. At RockBoost we know how to leverage each other’s strengths and expertise to ensure we can get anything done.
And most importantly, if we don’t already know how to do it, we figure it out!
A Different Set of Channels
One important difference between marketers and growth hackers is the maturity of the channels they use.
TV and radio, for example, are traditionally popular advertising channels for marketers in large companies. Few growth hackers would use such expensive, difficult to track channels hoping to achieve skyrocket growth.
Growth Hackers enjoy exploring new channels that few others have experience using. Unexplored territory where the do’s and don’ts have not yet been established are where growth hackers thrive. These channels offer opportunities for pushing the limits in creative ways.
Having emerged out of the startup world, growth hackers are skilled in finding new channels where they can push their products without breaking the bank.
Furthermore, the data driven approach dictates that growth hackers only invest fully in a channel once they have seen that it works. First test your Google Adwords idea for two weeks with a €100 budget before investing €1,000 into a full blown Adwords campaign.
The Internet is the growth hacker’s stomping ground. It constantly offers new opportunities to exploit, new possibilities to explore and new ideas to test. But it doesn’t end there.
At RockBoost, there are actually 19 innovative channels we have identified that business can use to gain traction and grow — and not all of them are online. The key is not using all of them simultaneously, but finding the ones that work best for your business at this point in time.
A Different Set of Tools
While there is naturally some overlap, marketers and growth hackers typically use a different set of tools. Growth hacking largely revolves around measuring, testing, tweaking and optimizing online processes and systems — and the tools they use reflect this.
There are all kinds of online tools at the growth hacker’s disposal. And depending on their level of technical skill, they will have their own set of preferences.
Some growth hackers with programming backgrounds might prefer to build custom tools themselves. However, for ordinary human beings, there are dozens of preexisting free and paid tools out there that require little or no coding skills.
Tools that YOU can use
The good news is that many of the tools growth hackers use are not overly technical. That means you, as an aspiring growth hacker (c’mon who doesn’t want to be a growth hacker?), can already start benefiting from these.
An advanced data analyst will typically have a strong statistics education and will use tools like R, SPSS and MathLab. They run lots of A/B tests, understand the fundamentals of confidence intervals, significance levels and are able to produce regression models to better understand customer behavior patterns.
Just because you forgot to get an advanced statistics degree at university doesn’t mean you cannot get useful data and insights about what your customers are doing. Luckily for you, there are programs like Google Analytics, KISSmetrics and Mixpanelthat will help give you rich data without the need for SPSS or MathLab.
These tools are not exactly simple, and will take time and effort to learn. But whether you are a business owner or a marketing professional, learning how to use some of these tools is well worth the effort.
To execute A/B tests, Optimizely and Visual Web Optimizer should be your goto tools. For understanding on where on the website your visitors scroll and click, heat maps, such as the ones from Hotjar will be your best friend.
You can collect user data and drive your customers to take action using tools likeOptimizely, Mixpanel, Qualaroo, CrazyEgg, Sumo.me and Inspectlet. You can measure customer feedback by integrating various tools on site using Survey Monkey,Survey Gizmo, Wufoo and TypeForm.
Google Tag Manager makes it easy to implement lots of these tools without having to edit the code of your website.
Is it Clear Now?
Hopefully this article has helped you get a grasp on the similarities and differences between growth hackers and traditional marketers. There are some overlapping focus areas. However, growth hacking involves far greater breadth in terms of the skills required, the tools used and general mindset.
So When do you need a marketer and when do you need a growth hacker?
You need a Marketer if:
1. You have a business that is large, well-established and needs an overall marketing strategy.
2. High reach and brand building is your primary focus, and you have the money to spend on big campaigns.
You need a Growth Hacker if:
1. You have an idea, concept or business model that is completely new.
2. You want to grow aggressively and quickly.
3. You can’t afford huge marketing campaigns with unknown ROIs.
Basically, you need a growth hacker if you want to start challenging your company and improving what you are doing. This should be what your company, no matter what its size, aims for continuously.
Originally published on: RockBoost.com