Entrepreneurs of internet based technology start-ups are faced with the dramatic and challenging task of growing an engaged user base that transforms into paying customers.
The internet represents an extraordinary landscape of dynamic change with new solutions of communication and discover constantly evolving. Over the last decade new products, services and features have emerged that constantly rewrite how companies attract, interact with and keep customers engaged.
The constant change occurring across the web has rendered growing an engaged customer base, or growth hacking, as much a science as it is an art.
While the rules of growth hacking have, and are likely to continue changing entrepreneurs should set time aside to understand these rules because once you have them understood you are better positioned to leverage them and break them to your advantage.
More information one the rules of growth hacking can be found in Growth Hacking Rules.
Here, we examine the basics of what is growth hacking, and how it can positively impact your efforts to grow an engaged community.
Growth Hacking Background
To begin with, business leaders should recognize that the disciplines of marketing and growth hacking are related, yet different sciences. While marketing is vested in growing a company’s customer base, the discipline is not as focused with user growth in the same way that growth hacking is.
The fundamental difference rests in the methods, tools and practices that have emerged to frame the science of growth hacking, and which simply do not fall within the traditional marketing repertoire. And, consequently, as time progresses these differences continue to widen.
Growth hacking’s central focus of growing an engaged community centers upon adopting the right systems, processes and mindset to leverage all of the available tools for customer growth. The distinct growth hacking mindset emerged from the evolution of how we definition the word ‘product’.
Traditionally products were physical items we could touch, hold and trade.
But, in the internet age, the term ‘product’ has evolved to include invisible bits and bytes of software that we cannot physically touch or possess.
Things like Facebook, Twitter, Amazon and PayPal are now considered products.
This transition has resulted in the need for a new kind of thinking, and a new professional role responsible for managing the plethora of available tools to leverage this new era of customer growth opportunities.
For the first time, a software and internet based products are able to play an active role in their own adoption. For instance, Twitter allows you to share their product with other users to improve your experience of Twitter. Dropbox will give you additional free cloud storage if you convince a friend to sign up to their could based storage service.
Traditional products like toothpaste or televisions are unable to offer such unique marketing or customer acquisition features, and this profound difference is how growth hacking emerged as a new science.
A second transformative redefinition that has impacted the way online company’s acquire new customers are the new means of distribution available through the world wide web. Traditionally, people were required to physically travel to brick and mortar businesses to get the products they needed.
Today search engines and websites provide new paths to digital businesses where customers can browse products and fulfill all of their shopping needs online. Moreover, instead of using physical infrastructures like streets, buses and trains to share products with friends, people now use social networks to share the things they buy with friends. The entire shopping experience can be achieved at home from one place, and one internet connected device.
This dramatic change has opened new means of reaching out to customers and transforming them into paying customers, and growth hacking’s central purpose is leveraging these new channels.
The Growth Hacker
To successfully apply growth hacking principles, individuals responsible with implementing growth hacking strategies must possess several essential characteristics.
Growth hackers must possess highly analytical minds because quantifiable metrics determine whether or not a growth hacking strategy is effective or not. Analytics will uncover which features improve or harm customer acquisition, what direction product development should adopt, why the company is succeeding or failing and what forces are driving the change, and what is likely to occur in the near future based on the trends of the past and present.
Growth hackers are creative individuals who must be inventive with the way they achieve customer growth. They should constantly question ideas, explore why something happens the way it happens, and how the company can impact customer habits in positive ways. The paths to grow users and transform them into paying customers are not always obvious or straightforward, so a bit of ingenuity is required to successfully find them.
3. Technology Proficient
Growth hackers must deeply understand and be proficient with the technology used to execute growth hacking strategies. Growth hacking will require employing unique software, databases, APIs, and other relevant tools to help start-ups grow suers. They are not necessarily required to know or understand code, but must be able to to guide talented programmers who do write code.
A good growth hacker must persistently search for and find new ways to take advantage of tools to grow a user base. They should be willing to try existing and new methods or ‘hacks’ over and over again to discover areas for improvement. Growth hackers should be informed of new technological developments, constantly push boundaries to fix gaps in their applied techniques, and be always on the lookout for system weaknesses that can be taken advantage of to enhance their user growth.
Growth Hacking Impact
The emergence and impact of growth hacking has illuminated new trends in the structure and operations of modern technology companies.
Traditionally, barriers existed between the the teams responsible for product development, the coders, and for acquiring customers, the marketers.
Now the marketers have learned, by necessity, what APIs are and other fundamental components that drive today's software systems. And, developers have learned that thinking about customer experience is essential for their role, and for developing great software.
This cross-pollination has greatly benefited software companies, and encouraged organizations to implement growth hacking techniques and mindsets in every department of their business, from customer support to product design.
For start-ups in particular who have limited budgets and resources, growth hacking techniques can help entrepreneurs get the most of out their staff and the processes that support their operations. As time progresses growth hacking techniques will likely not only be applied by new business but also established fortune 500 companies.
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