What is growth marketing?

by Adarsh Raj Bhatt in
green leafed plant with pot on black desk

Key Takeaways 

  • Growth marketers continuously innovate, experiment, and analyze techniques to potentially boost their user base rapidly and affordably. 
  • Growth marketing conducts rigorous testing, constantly switching between various channels and techniques, finetuning its experimentation bit by bit, slowly yet steadily, for the ultimate objective of evaluating the most appropriate method(s) for extracting the maximum value out of the budget allocated for marketing.
  • Every growth hacking plan is built on specific metrics (and techniques) that are important to the founders at that moment in the startup’s trajectory. 
  • Growth marketing has concrete benefits: it improves revenue generation, opens pathways to novel business strategies and innovative products, and it works for any team, goal, or product. 
  • Growth hacker marketing (or simply growth hacking) is a novel process of marketing products and / or services that employs strategies with a razor-sharp focus on boosting the startup’s growth.
  • SaaS growth marketing came about as a result of the latest advances in marketing technology. It integrates the utility of a long-term approach like inbound marketing with the short-term (and sorely needed) returns of growth hacking

What is growth marketing? 

Growth marketing refers to a startup’s attitude toward its customers (particularly in terms of how it attracts, engages, and keeps customers loyal) whereby it prioritizes aggressive testing and iterations, alongside focusing on the constantly evolving and specific inclinations of the ICP (Ideal Customer Profile).  

When founders develop messaging that is deeply personalized and cognizant of their ICP’s pain points, they can introduce high-velocity momentum into their growth via a variety of channels that hold great importance for their user base. When done right, growth marketing continuously fine-tunes the customer experience, which is a key objective that should ideally matter to all startup founders. 

Here’s the deal.

When attracting leads, traditional marketing approaches employ methods that have proven to be effective in the past: sales (held at reduced prices), email blasts, Google Adwords, etc. The problem is that any benefits you derive from these techniques - no matter how significant - diminish over time. Traditional marketing doesn’t proactively prioritize change in processes, techniques, and strategies when it comes to reaching out to customers. Such change, more often than not, squeezes more value out of the given budget against the backdrop of a market where the customer’s motives are constantly undergoing change. 

That’s where growth marketing (or growth hacking) steps in. It conducts rigorous testing, constantly switching between various channels and techniques, finetuning its experimentation bit by bit, slowly yet steadily, for the ultimate objective of evaluating the most appropriate method(s) for extracting the maximum value out of the budget allocated for marketing.

Bottom line?

Growth marketers continuously innovate, experiment, and analyze techniques to potentially boost their user base rapidly and affordably. 

Even a cursory reading of the preceding statement will result in a certain realization dawning upon most startup founders - the realization that “rapid” and “affordable” (or inexpensive) growth in customers is a deeply desirable objective for most startups, which makes growth marketing a worthwhile path to consider. Indeed, this inherent startup-centricity of growth hacking is how the term was coined in the first place. Back in 2010, Sean Ellis was looking to make a new marketing hire for his startup. But Sean wasn’t interested in a marketer who would go about things in a traditional way and take care of metrics like cost-per-conversion. Instead, Sean wanted to expand his user base - and fast. This mindset isn’t surprising considering that new SaaS entrants in the market have a chance only if they surpass everyone else. And that’s when Sean invented the term “growth hacking”.

How does Growth Marketing work?

Every growth hacking plan is built on specific metrics that are important to the founders at that moment in the startup’s trajectory. 

Some of these metrics could be:

Techniques used in growth marketing strategies include:

Also known as multivariate testing, A/B testing is deployed in formats such as drip marketing, lead-generation / landing pages, Google Adwords ads, etc. Founders can use any of two tests: “A” or “B”. They can even leverage a sequence of different tests. In each of these tests, a portion of the content is modified - for example, the structure, design, headline, call-to-action, copy, etc. Whatever the modification might be, tests are conducted to answer the question: Which version of the content engages more visitors and bumps up the number of conversions more than the alternatives do? A/B testing essentially asks this question over and over again, before and after every test. Every time there’s a winning variation, it’s used in upcoming campaigns - and is simultaneously iterated on. Thus, while the growth marketing definition does not make mention of this, growth marketing could also end up in some healthy content marketing growth for your startup.

Cross-channel marketing refers to a channel strategy for a startup to come in contact with its user base; it could comprise email, SMS, push notifications, in-app notifications, advertising mail (or postal mail), and any other media that best suits your target users. In fact, the question to be asked here is: what channel does the end user best respond to? What does the data have to suggest concerning how users prefer communicating - and being communicated with? Your marketing efforts must be customized according to the answers to these questions. For example, if A/B tests confirm that a specific user (or a particular segment of users) engages with in-app notifications at a 40% higher rate than their engagement with SMS messaging, then your upcoming marketing efforts should incorporate more in-app messaging, at least for that particular user or segment of users. 

The customer lifecycle refers to the various phases that a customer passes through in the course of their relationship with your startup. First, they are exposed to information about you, then they interact with you, then they make a purchase (or convert), and finally, they engage again with your startup. Growth marketing fundamentally works on 3 phases: the activation phase, the nurturing phase, and the reactivating phase. There are customized marketing efforts and campaigns for each phase as each phase makes a unique contribution to the journey that customers undertake as part of their relationship with you.

What do growth marketing campaigns actually look like? 

A few types of campaigns include:

  • Loyalty programs (for incentivizing existing customers to keep making purchases)
  • Referral campaigns (leveraging recommendations from existing users to attract new customers)
  • Customer onboarding program (to boost a new customer’s engagement, request data about their desires, and deploy upcoming marketing strategies based on their preferences)
  • Lead generating campaigns (to strategically attract potential customers, slowly win their trust, belief, and familiarity over the long term, and gently nudge them toward micro / macro conversion when the time is right).

Benefits of Growth Marketing

#1: Improves the revenue generation engine

Good revenue generation engines that have been fine-tuned by growth marketers over time ensure that the startup stays healthy and keeps growing. Growth marketing optimizes revenue engines by aligning team members (having different fields of expertise like product development, business development, and sales/marketing) under a common objective(s). Growth marketing also optimizes revenue by experimenting rigorously in order to be able to make data-driven decisions. Additionally, it focuses on boosting the revenue generated from marketing activities by approaching things innovatively and being flexible. 

#2: Opens pathways to novel business strategies and innovative products

Founders who prioritize growth marketing are able to stay on top of the latest trends in their sector. They’re also able to derive insights into user behavior, market changes, and product management that competing startups just can’t. Why is this the case? Well, as mentioned earlier, growth marketing requires constant testing, experimenting, and analyzing. This process imparts priceless understanding to founders about the interconnected ecosystem (of the customer, product, and industry) that the startup is nested in, allowing them to capitalize on this insight before competitors can. 

Capitalizing on this advanced data, insight, and understanding often takes the form of new business strategies, innovative ideas for product development, and better techniques for customer engagement - all of which have the potential to put the startup on a high-velocity growth trajectory.

#3: Works for any team, goal, or product

Growth marketing can be used by any team, at any startup, and in any sector. Considering the variety of places where it’s been used, it becomes clear that there is no despotism in its distribution. The only thing to keep in mind is that growth marketing is most suitable to growth-minded teams that have measurable goals that they wish to achieve fast (and are open to testing ever-more novel ways to achieve their goals). 

Speaking of which, it bears mentioning another remarkable facet of growth marketing, which is that it can be leveraged to achieve any kind of goal. This is because, at the end of the day, growth marketing is a mindset as much as it is a systematic process, which makes it possible to deploy it on all kinds of goals, irrespective of the parameters that you are measuring.

Limitations 

#1:  Limited guarantee of long-term effectiveness

Since growth marketing is such a young offshoot of traditional marketing - just over a decade old - there is limited definitive evidence of it being more effective in the long term, especially for startups that have progressed beyond the early stages and might stand to benefit just as much from traditional marketing as they would from growth marketing. 

#2: Not always possible to implement

If implemented properly, growth marketing can certainly add to the momentum of most startups. However, that might be a man-sized “if” for some startups. This includes those startups that fall under any of these criteria: 

  • Startups that are unable to hire great growth marketers. This might mean more startups than you think, considering that it’s not always easy to find many good professionals in this emerging field 
  • Startups that are unable to - spend the time and effort needed to - keep up with the continuously evolving field of growth marketing
  • Startups that are quite traditional (as they might take longer to learn/adjust to how growth marketing works and how it’s deployed)

#3: Proper execution guzzles time and headspace

Proper execution of growth marketing guzzles about as much time (and headspace) as an SUV that guzzles gas.

While growth marketing is a relatively affordable route to generate inbound online visibility compared to traditional marketing, executing it could end up requiring a lot of effort. Founders might need to conduct extensive experimentation before arriving at the best approaches for customer acquisition. There is a genuine probability of squandering time on subpar techniques that don’t turn out the way they are expected to. Proper execution would also require founders to do their (often comprehensive) homework on their methods and then deploy those methods consistently. Matters are complicated further by the possibility that there’s no one-size-fits-all approach to growth marketing: different methods work for different teams, startups, and products.

Sometimes, experiencing these realities first-hand marks a setback in the journey of founders who started out with growth marketing expecting immediate returns in terms of driving traffic. 

Growth Hacker Marketing 

Source 

Growth hacker marketing (or simply growth hacking) is a novel process of marketing products and / or services that employs strategies with a razor-sharp focus on boosting the startup’s growth. While the strategies are driven by data, the overall process relies on experimentation. Growth hacking works to rigorously identify opportunities for growth throughout the customer lifecycle (starting from the activation stage right to the advocacy stage). It then capitalizes on these opportunities by continuous product iteration.

Growth hacking has helped startups like Dropbox, Instagram, and Airbnb to drive customers, engagement, and revenue and become billion-dollar companies - all without reserving too much room in their budgets for traditional marketing techniques. These success stories serve to cement the fact that growth marketing is especially suitable for startups with highly limited marketing budgets (which happens to include most early-stage ventures); it helps such startups to market their products/ services with the momentum that’s needed to expand the customer base to the extent that founders envision it - and, sometimes, even beyond.

Growth hacking does not dogmatically accept traditional techniques, instead leaning into innovative methods which can be tested, switched, tracked, measured, and ultimately scaled. As a consequence, growth hacking promotes relentless iterations with the end objective of developing products, services, and brands that are ready to be scaled up to achieve business greatness. 

SaaS growth marketing

SaaS growth marketing came about as a result of the latest advances in marketing technology. It integrates the utility of a long-term approach like inbound marketing with the short-term (and sorely needed) returns of growth hacking (as described above).  

While SaaS growth marketing places high value on lead education, it also focuses on experimentation. It pays attention to every part of the funnel when it comes to expanding a SaaS startup, caring as much about rapidly experimenting and testing fundamental growth presuppositions as it does about setting the stage and infra for attracting loyal customers who will not just convert consistently but also\ advocate passionately.

SaaS growth marketing places customers at the forefront of affairs because it understands that customers are the foundation stone of a SaaS startup. Its purview does not stay limited to converting customers - it works equally hard on retaining them. It educates consumers, as it knows that this will improve their overall quality. With a belief in only data-driven approaches, SaaS growth marketing improves things by going all in on measuring, experimenting, tracking, and gathering feedback about them. Once it finds something that functions well, it prioritizes scaling it rapidly.  

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