Growth hacking: how to grow your company with smart and af­ford­able ideas

Small, new companies often find them­selves in a pre­cari­ous situation when first starting out: in order to get started, they have to get their name out there, but their small budgets make tra­di­tion­al marketing campaigns in print media, radio, and TV virtually im­possible. But with a little re­source­ful­ness and some elbow grease, these start-ups can hit the ground running even when dealing with the con­straints of more modest budgets.

One term that often gets mentioned within such a context is growth hacking. Growth hacks refer to marketing measures that focus ex­clus­ively on business growth in terms of both user and customer data as well as matters regarding con­ver­sion. At the same time, these tactics are so at­tract­ive because of their low costs. But what is it exactly that growth hackers do and what examples of suc­cess­ful use of this per­form­ance marketing tactic are there?

The different ways in which growth hacks manifest them­selves becomes apparent when taking a closer look at different instances of applying this tactic. Hotmail gathered a lot of positive attention in 1998 with this simple, yet in­nov­at­ive strategy: the free-of-charge e-mail service tagged a text on every e-mail sent that solicited users to sign up for Hotmail and included a link for re­gis­tra­tion. This simple measure turned the e-mail provider’s users into Hotmail bill­boards and helped gained more users, a move that helped gain over 12 million ad­di­tion­al users within a year. This growth hacking method is commonly employed by providers of homepage toolkits, which often provide free-to-use basic versions. In addition to offering a gratis (albeit limited) range of functions, these also add small ad­vert­ising banners, which include links that signal to the user which toolkit was used to construct the site they’re currently visiting.

And as the following example from Twitter shows, growth hackers need to be savvy on technical knowhow as well. When the messaging service first appeared in 2006, the company was able to quickly determine that users following a minimum of at least 30 other Twitter users were able to more quickly un­der­stand new topics, like hashtags and retweets, resulting in more frequent use. Twitter cap­it­al­ised on this knowledge by in­stalling a feature in the accounts of new users that re­com­men­ded different accounts that users may want to follow. As a result, users were able to more quickly reach the magic number of 30. Pinterest, which appeared four years later, takes this concept one step further: whoever registers within this network auto­mat­ic­ally follows users of selected top accounts.

Facebook and WhatsApp ex­per­i­enced almost-uncanny level of success with their various growth hacks. Their path to quick growth was paved with existing contact lists. In 2010, Facebook purchased the Malaysian company Octazen solutions, which spe­cial­ised in importing e-mail contacts. Soon there­after, Facebook in­tro­duced its contact import function, which enabled account holders to use their e-mail contact lists to invite new users to join the social network. The net­work­ing strategy for WhatsApp worked even better. Thanks to the automatic import of contacts from users’ mobile phone contact lists, it’s easy for users to find one another, and phone numbers make inviting friends and ac­quaint­ances to the app a simple task. Within the course of a few years, this strategy resulted in the ap­plic­a­tion gaining over a billion users, all without having to invest a penny in marketing.

Depending on the product or service in question, there are a few factors that you should adhere to so that your growth hacks produce strategic and sus­tain­able growth. The most important thing to always take into account is the product or the service itself. Growth hacking works best whenever the product or service in question speaks for itself and only needs a small spark to ignite a chain reaction of rapid growth. In other words, you’ll be able to increase your chances of having users act as engines of growth by con­vin­cing them to inform others about your product.

Of course, blogs and social networks both play sub­stan­tial roles when it comes to growth hacking. These platforms offer virtually free-of-charge ad­vert­ising that visitors are able to both directly consume and share amongst their friends and peers. Images and in­fograph­ics present es­pe­cially lucrative options for gen­er­at­ing buzz about your company. You should also make sure to always follow the latest social media trends. Staying up to date on the latest and most popular platforms, themes, and content types will most likely prove useful when searching for in­nov­at­ive ideas on suitable growth hacks.

But there’s more to making the most of this tactic than just being observant: flex­ib­il­ity and re­spons­ive­ness to changing situ­ations are equally important parts to this skill. Growth hackers aren’t just rewarded for their hard work: they also have to be able to overcome chal­lenges whenever it becomes clear that ordinary mech­an­isms aren’t working. The online storage service, Dropbox, provides a good example on how to do this: Dropbox in­centiv­ised re­gistered users to sign up for the service by promising them ad­di­tion­al, free-of-charge storage space whenever they solicited others to join the network or connected their Dropbox accounts to their Facebook or Twitter accounts. So-called Dropquest com­pet­i­tions, which had users solving tricky tasks in order to win ad­di­tion­al storage space, also con­trib­uted to the success of the file hosting service.

It’s often assumed that growth hacks con­sti­tute as not only cost, but also as time saving measures. This myth is debunked by the fact that working out the correct growth hacking strategy can be just as demanding as setting up an entire ad campaign. What’s more, growth hacks should never be seen as a re­place­ment for a sound marketing strategy, rather they are meant to serve as a sup­ple­ment to these efforts. And just as is the case with any tool, when used im­prop­erly, there’s always potential that more harm may come about than good.

This is es­pe­cially the case when you offer a product or service that is designed to add value to the customer ex­per­i­ence. In this case, you’re sure to ex­per­i­ence more robust growth through creative measures than with com­par­able offers of higher quality; however, such measures probably won’t be able to hold up on the market in the long run, as they’re only able to turn a few newly gained customers into repeat visitors. The majority of users will un­for­tu­nately be lost, and normally won’t return. And what could po­ten­tially make matters worse is the fact that some users may end up advising people against using your product instead of re­com­mend­ing it to others.

Having said that, the excellent chances that growth hacking offers cannot be denied. While search engine op­tim­isa­tion, social media marketing etc. are in­dis­pens­able features of any solid marketing mix, in­nov­at­ive growth hacks offer the perfect pos­sib­il­ity to po­ten­tially out do these afore­men­tioned marketing mech­an­isms and gain ad­di­tion­al users. The budget required to implement these measures is fur­ther­more quite modest, enabling less fin­an­cially-well-endowed en­ter­prises to compete with larger players.