Growth hacking involves quick experimentation across various areas of your business to identify the most efficient methods for achieving growth. The term was coined by the CEO of GrowthHackers.com, Sean Ellis after he found the absence of focus on growth in traditional marketers. In Ellis’s own words, “A growth hacker is a person whose true north is growth.”
So what does it takes to become a growth hacker?
To become a growth hacker, people should have knowledge in below areas:
- Keen on doing test experiment, to find out the potential growth;
2. Gained results based on fact (Competitor studies, User interviews, data analysis);
3. Rigorous — asks hard questions, validates assumptions, connects the dots
4. Ability to find the why behind the question;
5. Stay curious to the new things and changes;
What metrics does the growth hacker Look at?
- For online retailer, the most common metrics either is ‘GMV’ or ‘Buyer Numbers’;
- For Content / Entertainment products, their north star metric is ‘DAU (Daily Active Users)’ or ‘User Active Rate’
GMV and Buyer numbers — Ecommerce platform used to set it as the key metric, as the bigger volumes of orders they have, the more margins they win, the bigger market share they owned; However, if you only pay attention to incentive user to buy more, which is not enough, you need to make your users keep active and engage with your brand, only doing so you can expect to have a good product retention.
GMV = Sales amount + Cancelled order amount + Rejected order amount + Return order amount
DAU and Active rate — These metrics are of great helping to the comprehensive development of the product.
Active Rate = DAU / MAU
How to do user growth strategy?
To start with, let’s break it to 3 main module on this part
- User Acquisition
- User Activation / Engagement
- User Retention
1. User Acquisition
If you develop a product and the product has achieved its minimum value to consumer, what you need now is to grow the base of your potential consumer.
- Outsource channel: marketing channel (SEO / ASO / Google / Facebook /Affiliate / SMS / Email / App Union, etc…)
- Insource channel: Organic / CRM / Referral / Platform Redirect / Sharing
To grow the user base, you have to spend efforts to make the use of both outsource and insource channel; To use the channel more efficiently, you can combine with your target segments to use.
Outsource channel can help you to get increasing new users from all kinds of life, but you will need to spend money to buy the traffics.
Where Insource channel can help you to keep existing users active and enable them to invite more potential new users to your product, but most of the campaign still need budget to fund (eg. Share to win $10 together, App Special discounts, new user voucher).
2. User Activation / Engagement
If you have started to do the user acquisition, then you must have a certain based of users start trying to use you product, do you know what they felt about that? Do you wanna enhance the use experiences? Do you want to keep existing users stay active? Do you want them to refer your products to their friends?
I bet you must start thinking how to further enhance user active rate. Alright, we do have some approaches to do:
- Understand what is the made up of user stickness (eg. e-commerce)
To increase user engagement, you need to either let them to use your product more longer or let them to do some key actions (eg. purchase / write a review / share…).
2. Come up with interactions to encourage users to engage with brand
But it doesn’t mean you need a lot of product manager to build different tools, the main goal of the engagement tools is working to drive the growth of user active rate. Also, it doesn’t mean by simply copying competitor interaction can help you to win users easily, you will need to keep doing AB test and iteration to meet user expectation.
- New user welcome gift
- Mission Center & Coins (Incentive virtual gifts to motivate users do action)
- Easy action guide flow for review / shop / purchase
- Referral interaction
- Daily cheap deals recommendation (based on user browse behavior)
- Campaign & promotion
3. Target different segments to the best matched interaction, so as to maximize the conversion of user.
(Guest / Register / New Buyer / Learner / Active / Loyal / Lapsing / Lost)
4. Always have a chat with your product users to know the value of your product, by having continuous user interview and research, you will know whether you provide the right services which can really hit user pain points or not.
5. Keep your eyes in your product performance data to find the north start metric, as you might have different product function ongoing, performance data can tell you things which you haven’t know (eg. user who make orders once a month / user who open App over 4 times a month have 60–70% chance revisit in L30D)
3. User Retention
In the above points, we have known that if we want a product to be succeed, we need to have new bloods everyday, and keep the blood flooding. However, if we only doing these 2 ways which is not enough, because not every product can be used by people everyday, even the greatest social product ‘Facebook’, which 2nd day retention is under 50%, which means you have to recall existing users back to use your product in a certain time (eg. once a week)
If you only counting on consumers to open you product x times a month, which is really a hard thing, there are some approaches to help you:
- CRM Management Recall— send follow up message after xx days people browsed / purchased / reviewed;
- Outsources channels to list product updates / promotions
- Personalization user recommendation to keep everything new
- Expand business categories — User can find things to do
- Provide wishlist / shopping cart functions / Recently viewed to let user have chances to revisit save items
The End
Growth is a matter that is closely related to active users and retention. New growth is growth, and better revamping user retention funnel is also growing. A qualified growth hacker must have eyesights for the whole user growth structure, then you will know what phase of your product is in, and what is needed to be enhanced right away to achieve the new growth.
Thanks for watching ^_^
