Have you come across the term ‘growth marketing’ and wondered what exactly it meant? You’re not alone. There is some confusion in the marketing world about growth marketing and what it really entails.
The good news is that we’re here to help clear up some of that confusion. So read on to discover how growth marketing works, the ways in which it differs from traditional marketing and growth hacking, how growth marketing tactics can benefit your organization, and how you can design a growth marketing strategy for your own company today.
What Does Growth Marketing Mean?
The field of growth marketing emphasizes agile and evidence-based decision-making while focusing on the entire customer lifecycle. Much like a scientist conducting an experiment, a growth marketer regularly tests their techniques, such as the design and content of one landing page design versus another. They then make further marketing decisions based on their results. This allows marketers to rely on data instead of relying only on their gut.
Another important aspect of growth marketing is having individual team members who can take ownership of different parts of the process. For example, a fully-integrated growth marketing team will likely consist of experts in marketing, sales, customer support, and analytics.
In addition, traditional marketers may only focus on the top of the customer funnel, while a growth marketer puts time and attention into the entire cycle. Developed by Dave McClure, the Pirate Funnel was named because of the acronym: AAARRR.
From top to bottom, the funnel consists of Awareness, Acquisition, Activation, Retention, Revenue, and Referral. Though some companies may interpret the steps differently, every part of the funnel relates to a different piece of the puzzle. From top to bottom, the Pirate Funnel consists of:
Awareness refers to how many people you reach through various marketing methods.
Acquisition can relate to the number of visitors to your website or other metrics.
Activation relates to a customer taking the first step applicable to your particular business, from sharing an email address to signing up for a subscription or requesting a trial.
Retention refers to how many of those customers continue to use and come back to your product or service.
Revenue relates to how much customers are paying.
Referral is when a customer becomes an advocate for your business by sharing it with friends and family.
Whether your business sector is e-commerce sales or SaaS, successful growth marketing campaigns focus on a personalized customer experience and A/B testing, among other tactics. A growth marketer also gives equal importance to all stages of the customer lifecycle, from awareness to referral. Below, we will discuss how growth marketing is different from other types of marketing, such as growth hacking and traditional marketing.
What is the Difference Between Growth Marketing and Traditional Marketing?
When comparing growth marketing and traditional marketing, there are several main components to consider. While achieving success in either type of marketing involves staying on top of current marketing trends, the majority of the similarities end there. Traditional marketing is typically company-focused and aims to sell the product or service, while growth marketing zeroes in on the consumer and aims to provide the most personalized experience possible.
Another aspect of traditional marketing is its strong focus on customer awareness and acquisition. The types of issues a traditional marketer might be concerned with are the number of views a digital ad received or what the reach of a particular print magazine was.
Alternatively, a growth marketer is interested in not only gaining new customers, but retaining them. They strive to turn new customers into brand ambassadors who can then do the work of bringing in more customers. This requires marketers to continue engaging the customer beyond the initial acquisition.
Yet another difference between growth marketing and traditional marketing is the process by which marketing decisions are made. The constant testing done in the growth marketing sector provides data that can then inform the next steps in a strategy. Traditional marketing has typically relied on more opinion-based decisions.
Also, traditional marketers tend to plan campaigns and ads annually within defined marketing channels, whereas growth marketers are more frequently updating and tweaking their cross-channel marketing strategies. This allows growth marketers to be faster, more responsive, and more dynamic.
What is the Difference Between Growth Marketing and Growth Hacking?
Though some may use growth marketing and growth hacking interchangeably, they are not the same thing. Originally coined by “Growth Hacking” author Sean Ellis, growth hacking is all about achieving the most growth in the shortest amount of time possible. Growth hacking has been a strategy favored by many Silicon Valley giants who at least initially lived by the “grow or die” mentality, including Facebook, Twitter, and Dropbox.
There are several differences between growth marketing and growth hacking. Similar to traditional marketing, growth hacking focuses on the top parts of the funnel, generally customer acquisition. While growth hacking and growth marketing both focus on testing, growth hackers test with the goals of experimentation and refining an outcome, whereas growth marketers aim to identify patterns and design strategies.
Additionally, growth hacking leads with hands-on tactics, while growth marketing strives for marketing automation. Finally, a growth hacker focuses on optimization of techniques while a growth marketer focuses on customer personalization for long-term, meaningful growth and retention.
The Most Important Elements of Growth Marketing
There are a variety of tactics used in the implementation of successful growth marketing campaigns. These tactics include cross-channel marketing, A/B testing, and a focus on the customer lifestyle. Read on for a breakdown of two of these below.
A major focus of growth marketers is cross-channel marketing. This is important for several reasons. First, it allows businesses to create the most streamlined, customer-centric experience possible. Second, it enables companies to reach customers at every stage of the funnel. Creating customer awareness may involve working with social media influencers, buying digital ads, or creating a television ad. Customers at later stages of the funnel may require email marketing tactics, promotions, and various website features.
Cross-channel marketing encompasses a wide range of platforms and strategies, both in digital marketing and print marketing. It includes social media posts, Google ads, mobile apps, guest posts, email subscriptions, digital ad campaigns, print media, television/radio advertising, and more.
An essential component of a growth marketing strategy involves A/B testing. Also known as multivariate testing, A/B testing is when marketers use two variations of a marketing campaign and then do testing to determine which achieves the desired outcome, from greater engagement to a purchase or referral. To make results even more accurate and helpful, growth marketers typically divide their customers into subgroups and test how each of the variations perform with each subgroup.
For instance, marketers may design two versions of an email varying in tone, design, or content and test it on Gen Z, Millennial, and Baby Boomer consumers. Based upon the data, they could continue to tweak the content until it has the best chance of engaging their desired customer segment.
Benefits of a Growth Marketing Strategy
There are significant benefits to be had for companies who choose to adopt a growth marketing strategy. Read on to discover just a few of those benefits below.
As discussed above, both growth hacking and traditional marketing tend to focus on the initial stages of the customer funnel. In growth marketing, you are constantly discovering ways to not only gain new customers but also ways to keep them engaged.
This might mean offering discounts, delivering excellent content marketing, or up-selling or cross-selling. Similarly, growth marketers don’t seek the fastest growth in the shortest amount of time. They aim to uncover the most effective techniques that can be automated for the long haul, and they continue to improve them along the way.
Nobody likes to see an ad that offers new customers a cheaper price than they have been paying for the same product or service for years. The solution to this is for companies to value their customers over the long haul by continuing to offer benefits and incentives months and years after acquisition.
When companies continue putting effort into creating a personalized experience for long-term customers, those customers can become brand ambassadors who shout the brand’s praises, virtually or otherwise, to their friends and family. Customer retention is an important component of a growth marketing roadmap.
While there is certainly value in factoring opinions and gut responses into decisions, adding data to the mix makes the results even more actionable. The A/B testing emphasized in growth marketing allows companies to test the smallest decisions, such as the color of their home page, up to the larger ones, such as which incentives to offer for customer referrals.
This testing also allows companies to zero in on smaller segments of their customer base, such as dog owners or runners. In turn, the effect is an even more customer-focused product or service, leading to greater customer retention.
As opposed to the yearly evaluation done with many traditional marketing plans, a growth marketing manager more frequently evaluates the relevant data and makes needed changes. Instead of wasting valuable time and money on strategies that are not achieving your goals, it is better to actively evaluate and tweak tactics throughout the year.
Growth Marketing Strategies for Acquisition
There are a variety of ways for marketers to tackle the top of the AAARRR funnel, customer acquisition. Each business’s particular growth marketing strategy will vary depending on their particular product or service.
It is vital to think strategically about how you can help your customers. If they find what you are offering useful, they are likely to continue coming back. Below are a number of ways you can acquire customers using a growth marketing strategy.
Deliver Excellent Content
A tactic of many high-growth companies, content marketing is an invaluable way to attract new customers by providing them with something of value. Whether you post engaging, in-depth articles on a blog, create entertaining YouTube videos, send engaging marketing emails, or put out a weekly podcast, content marketing allows companies to carve out a strong brand identity while finding and hooking customers. Content that is useful, inspiring, or simply fun is what will keep customers following what you put out there.
Competition in the field is a huge factor when it comes to content marketing. While creating amazing content is the foundation, figuring out a way to reach your audience is the second challenge companies will have to overcome. Repetition, such as posting videos at set dates and times, and reaching influencers who will share your content are two ways to gain a following.
Create a Strong Brand Community
When developing your brand, think beyond just communicating from business to consumer. Instead, find ways that your customers can find each other. When you enable customers to find others like them, you cement your platform into their minds and encourage them to keep returning. You also further carve out a strong brand identity.
Enable Influencers to Spread the Word
You have an amazing product, right? Great-that is step number one. Step number two is spreading the word about your company in a loud, crowded marketplace of ideas.
Target influencers who would be a good fit for your product and share it with them. Make it easy and beneficial for them to share what they love about your product with their followers. Whether you choose bloggers, YouTubers, or Instagram stars-or all three-will depend on your particular niche and where your potential customers are most likely to be.
Give Away a Freebie
If a customer is on the fence about whether to try your product or service, money is likely to be a deterrent. Remove that hurdle and offer a taste of your product for free.
Potential customers no longer have to risk losing money, making them more likely to take step one. After they experience for themselves how amazing your product is, they will be more than willing to pay. Giving away a free sample or portion of your product is an excellent example of product-led growth.
Examples of Growth Marketing Campaigns
Often, the most effective way to understand and plan your own growth marketing campaign is to study the successful campaigns of other businesses. Below, we have outlined two companies who have experienced amazing results with growth marketing campaigns.
Case Study #1: Slack
Slack is an instant-messaging tool for work communication, created by a remote team who understood the struggles of remote work. They have used both growth marketing and growth hacking strategies. As the fastest growing B2B software provider ever, Slack is a valuable company to study when searching for insights into growth marketing success stories. We break down a few of their strategies below.
- They asked for feedback and constantly improved: The team at Slack didn’t create a product and then sit back on their laurels. They relentlessly queried users about their experience and suggestions for improvement, and made the necessary changes.
- They created a market and solved a problem: There was nothing quite like Slack before they showed up on the scene, and they used their software to tackle a number of business communication problems.
- They offered a free option: Slack offers a free plan that is substantial enough to stand on its own while also enticing customers to pay for the full plan.
- They provided seamless on-boarding: Slack makes it almost effortless for new users to sign up for the platform and invite others to join them.
Case Study #2: Etsy
When founders Rob Kalin, Chris Maguire, Haim Schoppik, and Jared Tarbell unveiled Etsy in 2005, eBay was the primary option for crafters looking to sell their goods online. By creating a platform especially for artisans, they tapped into a huge customer base who soon became dedicated members of the Etsy community. Here are a few keys to the company’s success.
- They defined a niche: As mentioned above, Etsy was created with artisans in mind. The team knew right off the bat who their target audience was and the needs that the audience had that weren’t being met.
- They created a low entry point: In addition to creating an artisan-focused-community, Etsy created a lower-cost option that required less risk from their consumers.
- They carved out a strong brand identity” Etsy did a phenomenal job of brand marketing by defining themselves as anti-consumerism, eco-friendly, and feminist. This likely further appealed to their target audience of small and mainly female business owners and buyers who didn’t want mass-produced items. When you buy a product from Etsy, you are doing more than shopping-you are proclaiming your values, whether they are supporting small businesses, helping the environment, or finding a one-of-a-kind gift.
- They used social media to grow: The strong brand identity Etsy created naturally fed into organic social media growth. They distinguished themselves with recognizable styles and products. Additionally, selling on or shopping at Etsy became a way to show others who you are.
When designing your own business’s growth marketing strategy, stay flexible. Combine both gut decisions and the data you uncover through frequent testing of tactics, from marketing emails to website design. Focus on all parts of the AAARRR funnel, putting as much time and attention into engaging existing customers as you do in finding new ones. Carve out a strong brand identity and use content marketing to share useful videos, blog posts, podcasts, and more with your consumers. Finally, use other successful growth marketing campaigns as inspiration for your own strategy. When it comes to growth marketing, as long as your business continues to grow and evolve, there’s always a path through.