What is Growth Hacking?

Lifting a new business off the ground quickly is challenging, but incredibly important. Luckily, there are plenty of effective growth hacking strategies you can employ to create sustainable growth for your business. Do you want to learn how to do growth hacking? And what is growth hacking, exactly? Keep reading to find out!

You’ve got a great business idea, but business seems to be slow. So, you read a case study about how a great growth hacking strategy helped a business rake in new users. But will this strategy work for you?

Before you start implementing a specific tactic it’s important to get a few things straight. Starting with the most obvious: what is growth hacking, anyway?

The definition of growth hacking

Growth hacking is still a relatively new term, coined by entrepreneur Sean Ellis in 2010. Before coming up with this buzzword, he was trying to name a new job position for someone who can help startups accelerate their growth and offers consulting, and also defined that person as “someone whose true north is growth”.

For a startup, quick growth is everything. Either you manage to gain revenue and users, or you die out. So, a growth hacker is a person whose job is to find effective, creative, and sometimes unconventional solutions to help a startup grow quicker.

Growth hacks you should know about

Growth hacks you should know about

It sounds awesome, so how can you do growth hacking for your business? Truth is, there are dozens of effective ways to do it. Here are some of the most common ways of hacking growth:

• Content marketing: Whether it’s boosting your ranking through blogging, gaining leads with lead magnets or webinars, or sharing your expertise on podcasts and YouTube - content marketing is a strategy you should probably employ whatever your business or industry is.
• Referral marketing: When done right, referral marketing can have a tremendous ROI. Make sure people have a reason to recommend your business and keep working on building solid client relationships before you try to grow with referrals.
• Affiliate marketing: The “everybody wins” mindset of affiliate marketing is precisely what hacking growth is all about. Some of the most successful businesses earn between 5% and 30% of their internet revenue from affiliate marketing.
• Gamification: This is one of the best UX growth hacking tactics out there. Create a memorable experience by implementing game-like elements, such as levels, rewards, options, or points.
• Partnering with an influencer: Love them or hate them, influencers are an unavoidable part of social media marketing today. The key to doing it right is finding an influencer close to your brand and niche. A smaller number of devoted followers is much better than millions of random people who have no interest in what you have to offer.
• Building a social media community: Increasing your social media following is important, but focus on engagement first. Build rapport with your existing audience, and create a space for people excited about your brand.
• Giveaways: A little goes a really long way, as contests can have conversion rates as high as 34%. So, this is yet another (commonly) social media growth hack you ought to try.
• Brand partnerships: Tap into a new market, and offer your customers more by creating a partnership with another brand.
• Product Hunt launches: Spread the word about your digital product on one of the popular platforms. Get employees and your community involved, by asking them to upvote.

Famous growth hacking examples

I know what you might be thinking - how is growth hacking different from regular marketing activities?

In many ways, it’s not. What earns growth hacking its name is the effectiveness of these (marketing) efforts. When done right, some of these strategies can yield exceptional results.

So, here are some of the most famous growth hacking examples you can look up to.

Dropbox grows by 3900% through a referral program

Before referral marketing was a thing and every marketing strategy had some sort of referral included, Dropbox managed to pull off an almost 4000% growth in only 15 months.

How, you might ask? By offering people something for free if they pay them back a simple favor.

Dropbox has a simple product: offering storage space in their cloud. You can get up to 2 GB of free storage for signing up, and pay for more. The referral growth hack allowed people to get 500 MB for every friend they can get to sign up, and the friend gets the same storage space too. You could get up to 16 GB of storage space. That meant a lot of storage and a lot of new users for the SaaS company.

And the numbers tell more than any word would: in September 2008, before using this tactic, they had 100.000 users. By December of the next year, that number grew to four million. Now, the company has more than 1 billion in revenue, and an estimated 14.6 million users as of the first quarter of 2020.

Hotmail loves all of you

Hotmail had a growth hack even before Sean Ellis coined the term. Being one of the first free email providers, starting long before digital marketing was a must, they had a very simple idea that made their sign-ups surge quickly.

At the end of every email, stood the phrase “PS I love you. Get your free email at Hotmail”. It made people look, and they used every one of their users as a vessel for free email marketing. Nowadays, “Sent from my iPhone” and “Shot with Huawei p30 Pro” is a common practice, but then it was groundbreaking.

And a simple cheesy phrase brought them one million users in half a year. About a month later, they doubled those numbers to two million.

Airbnb invades Craigslist

From its beginnings, Airbnb was a business whose co-owners tried all sorts of strategies for customer acquisition, without spending a penny. The reason for that was, well, they were broke. But nonetheless, they found a growth marketing strategy that provided them scalable growth.

After realizing that there was a shortage of housing in San Francisco, the Airbnb founders would go from tech conference to tech conference, trying to market their service. Then, they decided to improve the quality of the photos of listings on their website.

When this didn’t really do wonders with their customer base, they turned to a growth hacking tool some might say isn’t quite ethical, but it definitely is genius: they used the Craigslist API reverse engineering hack. They allowed Airbnb users to cross-post their listings on Craigslist, hence using a much more popular website at that time for their own gain.

LinkedIn hits the bullseye through indexing

If your key selling point is enabling people to be discovered and market their professional capabilities, it’s only natural to make your user base available to be found. That is how LinkedIn figured out a simple thing to help them achieve their best growth possible quickly: they enabled users to create public profiles that search engines can index.

This is a great example of growth hacking social media done right. Now, every time someone uses Google to look up a potential job candidate, the chances that they’ll land on LinkedIn first are bigger. And they’re doing us all a favor—who wants a recruiter to see their Facebook or Instagram first?

PayPal plays a risky hand… and wins

PayPal’s trick can’t really be found in any growth hacking playbook. Giving away freebies like additional storage, a month-long trial or marketing on another platform for your own startup growth are all risky growth hacking ideas , but actually giving people money is another thing.

In one of the startup industry’s craziest marketing campaigns, PayPal actually paid people to sign up. For every friend they’d bring onto the platform, both people get $10, which helped them achieve a 10% daily growth and more than 100 million new people in their user base.

Why? Because they knew that the customer lifetime value was much higher than $10, and they decided to invest in their own future.

Dollar Shave Club shows the power of the viral video

This example might not have been thought out by a master growth hacker, but is a wacky idea that became the definition of viral marketing. Michael Dubin, founder of the company, writer, star, and comedic genius, couldn’t really predict the virality of this promo video, but he definitely chose an unconventional path that resulted in a really successful business.

Rarely a promo video includes a toddler wielding a razor, a horribly mismanaged warehouse, and random mascots that don’t really serve a purpose. But, humor is something everyone appreciates, and a razor that comes to your door once a month for a single dollar is another thing it’s hard to skip on.

The Dollar Shave Club growth team knew people were online and recognized the power of the viral video long before others did. The result? They now have the highest customer retention rate among men’s grooming subscription companies. Just like the video, this shows how hacking growth is as much about raising profits, as it is about making powerful connections with the right clientele.  

And their viral video itself is a part of digital marketing history: it’s been seen more than 27 million times. Talk about a successful ad!

Tesla makes the customer a star

Tesla is an electric car manufacturer that sells not just a car, but a lifestyle. Being the biggest alternative to fossil fuel-powered cars, they are a strong market disruptor. But, apart from that, they also rely on great design and engineering.

So, how does this huge company manage to spend next to nothing on traditional marketing? They make their customers marketers. First of all, their products are scarce, expensive, and exclusive. People who buy their cars, want to share that on their own social media, and Tesla often re-shares those posts. Not only do they market, but they also reassure potential new users with good customer experience.

Elon Musk, CEO of Tesla, often replies to questions about Tesla products on social media.

Lastly, they have an amazing referral program and they reward word-of-mouth and good reviews with credit for a new Tesla car of up to a thousand dollars, free accessories and maintenance, and exclusive access to showcase events.

And even since starting out, Tesla has had crazy ways of marketing. Remember that car Musk put on a SpaceX rocket? Yeah, it made sales surge.

Slack defines the product-market fit

Sometimes, you don’t need a genius growth hacker, great content marketing, brilliant advertising, or even a powerful social media presence. Sometimes the secret of success is having a product-market fit, and Slack is the epitome of that.

If you’ve worked in a big company or remote team, you probably realize that communication is key to having a smooth workflow. We’ve all been there: a group chat on Google Hangouts, a video call every day, a chat with the coworkers for non-work related jokes on Messenger. But Slack made it possible to have internal communication inside companies without spamming others and getting the message across effectively.

Some of the main promises Slack had when they started out were better communication, relief from stress, a decrease in information overload, better organizations and better teams.

Since they launched, Slack slowly increased their customer base and observed how everything functions, and improved their product development based on those findings. They also responded to around 8000 help tickets on Zendesk and tweeted back to 10000 people each month to help improve customer service.

Uber relies on good old word of mouth

Uber grew rapidly by depending on nontraditional ways of marketing, with the help of investor Andrew Chen who led its growth teams. Firstly, they decided on their new markets based on thorough research, and solved all the problems of using a taxi service: easier to pay, easier to find a ride, lowering prices, offering people an easy side-job.

But what they did best was relying on word of mouth to promote their business, and focusing on customer reviews. They even used bad PR and legal battles to gain support from their customer base online.

Ahrefs creates a stir at a conference

Growth marketing ideas seem to be particularly suited (and popular) with digital and SaaS products. Does this mean a growth hack only works online? Absolutely not.

One of the most amazing examples of offline growth hacking comes from Ahrefs, a leading SEO and analytics tool. During the biggest SEO conference in Brighton, they shared these clever coffee cups, which made people instantly aware of their service.

Moreover, the cups’ clever design made people share them on social media, providing even more visibility for the company.

Spotify makes it personal with Wrapped

Personalization in any shape or form is probably one of the best growth hacking tactics you can employ. And few examples demonstrate that as well as Shopify’s 2017 campaign called Wrapped (formerly “Year in Music”).

You wouldn’t think so many people cared about learning more about their listening habits - after all, they’ve been a part of the process. But there’s a key element you might be forgetting: social sharing.

We all want to put our best foot forward on social media, and Spotify made this both fun and super easy with wonderful social sharing templates that allowed each of us to feel quite unique thanks to our music listening habits.

In 2020, they took really honed in on the social sharing aspect, by making Wrapped available for mobile users only (95% of people access social media on mobile devices). The introduction of stories, quizzes, and other interesting features made the whole campaign as much about social sharing as it is about music.

And the results? In 2020, the number of Spotify downloads increased by 20%!

What’s the best growth hack for your business?

How to do growth hacking for your own company, that is what is the best strategy to choose?

There’s no single answer to this question. Ultimately, before you choose a growth hacking route to pursue you should ask yourself these questions:

1. Define your goals: Getting more social media engagement and selling your product may be closely linked. But they are different goals, at the end of the day. Choose one initiative you really want to focus on and find a growth hacking strategy that makes the most sense.
2. Understand your target audience: Many of the examples we’ve mentioned here stem from a deep understanding of the target audience (Slack, DSC, and Uber, to name a few). Hacking growth is often a way to make your company more successful by responding to the needs and wants of your users.
3. Evaluate your current channels: Do you want to use growth hacking to double down on a successful channel? Or build up a new one? Before you decide on the best course of action, you must understand what your assets are.
4. Test and adapt: At the end of the day, there’s hardly any growth hacking without trial and error. Set up and follow your KPIs, get input from your team, and keep experimenting until you find the growth hack that works best!

Whether you hire a growth hacker or decide to roll up your sleeves and do it yourself, we hope this information helps.

For a bonus tip on hacking growth with awesome design, check out this article on how design can help your business.

{{GENERAL_PORTFOLIO="/dev/components"}}