Every year, over 500,000 new businesses start in the US, and over 200 billion dollars are spent on marketing, as reported by .
It can be difficult for any company to stand out in such a crowded marketplace.
It's become more crucial than ever to have an innovative, adaptable, and persuasive marketing plan to stand out from the competition. a strategy that fosters virality, word-of-mouth, and organic growth in addition to aiding in customer acquisition.
Growth marketing is the term of this innovative and effective strategy for creating a devoted user base.
Let's examine what growth marketing comprises and what qualifications a growth marketer needs to succeed.
Growth Marketing: What is it?
Growth marketing is a data-driven strategy that employs experiments to figure out how to improve outcomes. Using an A/B test, for instance, to determine which push notification consumers prefer. When a system is effective, it's used constantly. When a system isn't, more tests are run.
Marketing initiatives have typically been kept apart from product development, with the marketing division kept separate from other parts of the company.
Growth marketing is now part of the product development process. The growth metrics that matter must be thoroughly studied by growth marketers.
Although the term “growth marketing" suggests a strategy solely focused on luring in more people, there is more to it than that.
Customer discovery is where growth marketing must put its roots.
Customer discovery, also known as product/market fit, is exactly what it sounds like: identifying the people who are experiencing the issues that your solution can solve most effectively.
Steve Blank, a businessman, and author asserts that:
"No company plan survives initial interaction with clients."
The growth marketing strategy can also be directed by a thorough grasp of the consumer to best serve the company's objectives.
For instance, LinkedIn identified users' intense interest in their vanity metrics, which made it simple for the company to persuade users to provide more information, such as personal contacts, to benefit from the network effect.
Growth marketing's objectives
The broad objectives of growth marketing are objectives that any company should have:
maintain current clients
- Obtain new clients
- The rise in revenue.
Growth plans improve in effectiveness as the company grows, both in terms of cost and conversion rate. But how can one expect that growth marketing will help them achieve any of these broad objectives?
Client Retention
Retaining current consumers is arguably growth marketing's most crucial objective.
To ensure loyalty to your company's product or service, the satisfaction of current customers should be given priority. It is far simpler to sell to an established customer than a new one since there is less friction when they make a repeat transaction.
In light of this, it is paradoxical to attract new clients if existing ones aren't sticking around. A business concept that has trouble keeping customers can suffer from high customer acquisition expenses.
Prioritize client retention and happiness before scaling consumer acquisition expenditures.
Brand loyalty increases as people return and continue to be pleased with their experiences. Word-of-mouth marketing can be fueled by brand advocates to increase consumer acquisition.
Regions to check
- Incentive schemes
- Onboarding new users
- Email triggers
- Getting new clients
The chase for new consumers becomes commercially viable if customer retention has reached a stable level. The capacity to successfully approach new users and persuade them to buy is the acquisition of new consumers.
Being visible in the marketplace is one of the foundational principles of client acquisition. Where are clients looking for a solution to their issue, and how does your offering fit into this?
It might be an indication of sustainability to know how your customer acquisition strategy fits with customer retention. How do these two growth marketing objectives advance the next objective—profit?
Regions to check
- the internet
- Paid searches
- Risk-free test periods
- Increased earnings
If your growth marketing strategy isn't sustainable, your revenue may increase while profitability decreases.
A growth marketing strategy that is effective will open up new revenue streams without unduly raising costs. If done correctly, client lifetime value will rise as retention rates outperform attrition.
Regions to check
- Annual payment
- Customer feedback
- List of package deals
- Traditional marketing versus growth marketing
Traditional marketing and growth marketing are highly dissimilar, just as digital marketing and traditional marketing are very dissimilar. Growth hacking is less about using strategies that are often utilized in marketing and more about having a mentality for growth.
An open mind is necessary for growth marketing
Think about Frank Zappa's comparison of the mind to a parachute. If it's closed, it won't function. Although leaving the status quo can be challenging, perhaps we should all concentrate on the "status Woah." Consider what tiny adjustments can amaze your users.
Businesses with a growth mindset don't squander money on marketing initiatives that haven't worked. Before committing fully to a certain strategy, growth marketers ease into their marketing budgets by taking an experimental approach to these investments.
It can be challenging to demonstrate the return on investment for many traditional marketing techniques. When compared to the click-through rate of an online advertisement, it is harder to determine and quantify the value of a physical location like a billboard or magazine ad.
Because of this, a growth marketing approach prefers the flexibility to any strict norm.
Process of Growth Marketing
Growth marketing is based on the iterative learning principle, which involves systematic optimization and gradual increases in client acquisition, retention, and lifetime value. Growth marketers can learn from this process which approaches are effective and, more importantly, which ones are not.
What steps must you take to perfect the growth marketing process?
Charts measuring hypothetical performance for growth marketing
Actionable Metrics Definition
It's crucial to incorporate a control group in the testing procedure as a baseline to assess the real performance of variables. A control group is isolated to prevent results from being incorrectly interpreted or given the wrong credit.
Growth marketers need to be aware of the metrics that are important to their company and assess the results of experiments. Every marketer must be aware of vanity metrics, even though they might change greatly depending on the business.
Vanity metrics are fake measurements that mimic sustainable progress. Similar to the number of app installs, these don't truly show whether the app is seeing a strong retention rate, a crucially important indicator.
Test A to Z
Possessing the courage to try new things is perhaps the most crucial element of growth marketing. Experimentation can produce significant effects even with small changes. A/B testing is a well-liked application of the kind of experimentation typical in growth marketing due to its relative ease.
However, we quip lightly when we question, "Why stop at B?"
Testing the moving elements and their effects on performance indicators is a key component of growth marketing. The effect that seemingly random aspects of marketing content, such as font weight, background color, and button corner radius, can have on conversion rates may surprise you. Because of this, some of the most crucial work done by marketers involves micro testing.
Adopt Improvements Incrementally
It's time to grow what worked now that you have observed a considerable improvement in key indicators. Finding techniques that performed well in testing, if used in a population sample, are probably effective when applied on a broad scale.
Growth is scalable, but growth is frequently not scalable. For this reason, it's crucial to assess whether solutions are effective before increasing these techniques. Fail quickly, absolutely, but progress as slowly as is necessary to succeed over the long term.
Growth Marketing Guidelines
Growth marketing strategies might not be as appealing as quick growth hacks, but they are nonetheless crucial for any business pursuing long-term expansion. Growth marketing is based on best practices that cover planning, carrying out, reviewing, and revising.
Purpose of growth marketing
Establish objectives and goals.
Setting goals and performance targets can help choose which techniques to use, even though plans and forecasts may never match up with reality. “You’ve got to be very careful if you don’t know where you are going because you might not get there, '' Yogi Berra memorably said.
Be flexible.
It can be tempting to use every marketing tool in your toolbox if you have the responsibility of expanding a company. However, when crossing new waters, it's crucial to use caution and prudence.
Sometimes doing nothing is the hardest thing to do. By starting small, validating a technique, and only moving forward if it is successful, we must learn to develop patience and discipline.
Try Out Different Approaches
Since the best practices are so similar, the essay might also be named "How Growth Marketing Is Like Investing."
Portfolio diversity, which is a best practice in growth marketing, is a frequent theme in the investment world. Don't rely solely on a single approach by putting all your eggs in one basket.
Choose the growth marketing techniques that will work best together by distributing a smaller amount of the overall budget among them.
Recognize Your Failures
It's critical to be aware of failing tactics and ready to abandon them.
The sunk cost fallacy is the propensity to stick with the same course of action even when the results are unfavorable rather than changing it. Recognize when something isn't working out and make the required changes to your approach.
Remember Where You Came From
Keep in mind how crucial customer retention is.
Growth marketers frequently undervalue the significance of customer retention in favor of obtaining new clients. For instance, mobile app marketers will occasionally attempt to conceal detrimental retention numbers like daily active users.
According to infamous Silicon Valley investor and founder of Ycombinator Paul Graham:
"It’s better to have 100 people that love you than a million people that sort of like your product"
Focus on acquiring 100 devoted fans rather than attempting to obtain millions of readers, downloads, or consumers.
After that, scale the model you have shown to be effective with the first 100.
Yes, it is feasible for a fundamental shift in strategy to have a direct, beneficial effect on a company.
It is more likely, though, that growth will occur iteratively and that results will follow the conventional hockey stick pattern, becoming more prominent over time.
Conclusion
Growth marketers must have an analytical mindset and be prepared to act on their discoveries. The growth marketing toolbox is essential to laying a solid foundation for growth, much like the relationship between a carpenter and their toolbox. Knowing what tactics to use, what metrics to monitor, and which tools to monitor them can be challenging.
