Growth Marketing

What Is Growth Marketing & Why Do You Need It?

January 11, 2022
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Growth Marketing

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As the market is rapidly changing and businesses are struggling to survive, standing out is becoming quite challenging for companies, especially new ones.

Developing strategies that are creative, engaging, and beneficial for the customers as well as for the business is inevitable. This customer-first approach that goes beyond just customer acquisition and aims to profound relationships with your existing customers is known as growth marketing.

What is Growth Marketing?

Growth marketing is the sum of user-focused, tactical activities that are both experimental and constantly evolving. Growth marketing takes the traditional marketing and adds multiple valuable layers such as A/B testing, SEO, data-driven campaigns, engaging blog content, etc. The focus of growth marketing is on maximizing all growth opportunities for the business throughout the entire funnel.

This is why growth marketing is the preferred strategy for businesses looking to position themselves on the market and scale quickly as it delivers performance-based ROI.

What is Growth Marketing

What are the Benefits of Growth Marketing?

The critical growth marketing advantages are:

  • Speed to market.
  • A more significant return on investment.
  • The ability to quickly scale any marketing activity producing desired results.

Other relevant benefits include higher ROI and establishing the emotional connection with the target audience depending on their stage in the funnel.

Growth marketing connects marketing, sales, data-driven, product development, finance, and other areas enhancing the ways customers interact with the product.

The data-driven growth marketing approach allows companies to leverage different tools to make their processes more efficient. Not to mention that having access to data simplifies proving the ROI of all growth marketing activities.

What Differentiates Growth Marketing from Other Types of Marketing?

Many business owners will focus only on performance marketing, inbound marketing, or any other marketing type and later complain they couldn't reach their marketing and sales objectives.

The reason for that lies in the limitation behind each of these approaches. While focusing only on growing your business, growth marketing combines all fields to find the best strategy for scaling your business and producing lucrative results.

Businesses that need growth marketing will typically be in one of these situations:

  • You own a startup but have no marketing experience,
  • You drive impressive organic traffic to your website, but there is almost no growth on your pillar channel,
  • You're launching a new product and need a go-to-market strategy,
  • You’re experiencing a growing product demand but lack the resources to establish meaningful relationships with potential customers,
  • You have a big paid marketing budget but don't see a lot of ROI,
  • Your company is looking into improving the branding across all platforms,
  • You have so much valuable content, but don’t know how to market it well,...

Simply put, if your business struggles with any metric of the AARRR (acquisition - activation - retention - referral - revenue) framework, growth marketing is the end-to-end strategy that you need.

Types of marketing

Digital Marketing vs. Growth marketing

Because there are many types of marketing, it can be unclear to understand what your business needs. One of the first mistakes business owners often make is that digital marketing and growth marketing are synonymous.

When comparing the two, you should know that they differ in methodology. Digital marketing includes all area-specific marketing tactics applied digitally - SEO, email marketing, PPC, online advertising, etc.

Rather than developing tactics, growth marketing focuses on the primary goal, data analysis, testing, and optimization. Growth marketing uses many digital marketing techniques, but its focus remains on driving measurable business growth throughout the funnel.

Growth Marketing vs. Growth Hacking

Growth hacking is not the same as growth marketing. Growth hacking focuses on short-term results, while growth marketing focuses on the bigger picture. Here's a deeper dive into the differences between the two:

  • Growth hacking focuses on achieving rapid growth, usually through acquisition, while growth marketing focuses on achieving long-term growth through a set of full-funnel strategies.
  • Growth hacking looks at data to experiment and refine the outcome, while growth marketing examines data to identify patterns and refine strategy.
  • rowth hacking involves hands-on tactics with testing and tuning, while growth marketing involves automated and algorithmic processes with periodic adjustments.
  • Growth hacking focuses on business pain points and goals, while growth marketing focuses on customer pain points.
Growth Marketing vs Growth Hacking

Some of the best growth hacking techniques to boost conversions are:

  • Finding a social media platform, your competitors are still not using,
  • Partner with another audience to expand your reach,
  • Run constant A/B testing on your landing pages, homepage, sales pages, etc.,
  • Invite your audience to take the NPS survey by submitting their questions or concerns,
  • Use Piggybacking marketing is to deal with a non-competing brand and promote both brands with the same content or use the other brand's audience to attract potential customers.
  • Participate in offline marketing events that help grow and identify real needs for your audience, such as events in your niche, etc.

Core Components of a Growth Marketing Strategy

Each growth marketing strategy will be based on metrics like customer acquisition rates, conversion rates, customer retention rates, and customer lifetime value (LTV). Below, you will find some of the leading tactics today’s growth marketers are using to attract, convert, create, and retain engaged customers. This tactic is mainly used in e-commerce but can be very profitable for ordinary businesses.

Cross-channel Marketing

With a cross-channel marketing strategy, companies are able to interact with both prospects and customers through their preferred channels. This means that the way a business interacts with their customers on Facebook might significantly differ from the way they communicate with them on Instagram, email, or website.

A/B Testing

A/B testing allows businesses to examine similarities and differences between two variations. Whether it’s to A/B test a particular marketing strategy, channel, or content type, it helps to understand which variation is performing better and why.

Customer Lifecycle

To know its customers, the business will need to learn about their journey from the moment they embark to the moment they become loyal customers. The more complex AARRR framework can be simplified into a three-stage approach that focuses on activation, nurture, and reactivation to figure out how to approach them in the most efficient way possible.

Marketing channels

Growth Marketing Channels

Regardless of the reason why you need growth marketing, business, you will need to cover the following areas to maintain sustainable growth:

  • SEO: Running keyword research, optimising your web content, and building backlinks.
  • Blog content: Make sure to include a strong call-to-action message to convert readers into leads in your articles.
  • Repurposing content: Your created content should be repurposed and shared across different platforms.
  • Automated email marketing: Determine valuable information to engage and convert your leads.
  • Targeted email marketing campaigns: Each lead or customer should receive specific messaging based on their customer journey stage.
  • Affiliate marketing: Have a third party promote your business and services and access their new audience through promotions, discounts, and collaborations.
  • Offline advertising: TV, radio, and billboards are still powerful tools to reach specific demographics and help with brand building.
  • Social and display ads: Use remarketing to target audiences who have shown previous interest in your business.
  • Traditional PR: Blogs, tv, newspaper, press publications can get your word out and engage a broader audience.
  • Unconventional PR: Use extreme measures to gain publicity and traction quickly and efficiently.
  • Trade shows: Depending on the industry you’re in, this could be the place that gathers all key players you want to reach out to.
  • Sales: Improve how your sales team, sales funnels, and customer support work toward your growth marketing objective.
  • Community building: Being an active participant in a community brings many benefits as it gathers people with similar demographics.
Marketing metrics

Growth Marketing Metrics

As growth marketing is entirely data-driven, it will be easy to track if your strategy aligns with your objective. By constantly tracking these metrics, you will be able to optimise on time and perform better:

  • Traffic on your website: This traffic can be direct, organic, or coming from other channels.
  • Leads: The number of marketing-qualified (MQLs) and sales-qualified leads (SQLs) your business is generating.
  • Email: Track metrics such as open rate, click-through rate, reply rate, and conversion rate.
  • SEO: Metrics such as organic keywords and website traffic will show your SEO performance.
  • Monthly recurring revenue (MRR): Predictable revenue to be earned each month.
  • Average revenue per user (ARPU): Determines the revenue-generating capacity of an organization at the customer level.
  • Customer retention: Number of upsells, cross-sells, and churn rate to keep the customers around.
  • Customer lifetime value (CLV): Metrics that calculates the total expected revenue from a single customer over a time period.
  • Paid marketing: Return on advertising spend (ROAS), customer acquisition cost (CAC), and conversion rate demonstrate paid marketing ROI.
  • Activation rate: The total number of new users taking a pre-decided action within a certain timeframe.
  • Annual returning revenue: Return on investments over a period of one year.
  • Revenue churn: Metric that calculates the company’s lost revenue over a time period.
  • Churn rate: Metric that calculates the percentage of subscribers/customers who either haven’t renewed their subscriptions or have cancelled them in a certain period of time.

Growth Marketing Tactics & Hacks

You can apply plenty of tactics in your growth marketing strategy to reach your goals faster, whichever your goals might be.

Add Different Discounts To Your Referral Program

To implement a referral program, you can simply create a landing page, and invite your customers to share it with others, however, you will need more if you wish to capture the immediate attention of your target audience. One way to do so is by having different promotions in your referral program. For instance, you can have a discount for a new user, additional discounts for buying more than just one product or service, annual discounts, limited edition discounts, etc. This can also help you start building your audience of loyal customers who will always come back to your business.

Offer Exclusivity

The interest of people in something always grows if that product or service is exclusive and available to only some people or for some time. That’s why many businesses offer exclusivity to their potential customers. This is a quite handy tactic when launching a new product as the more urgency you create around its selling point, the more people will be interested in it. So, instead of making it available to everyone from the first moment, consider limiting the product’s availability and get people to chase after it.

Gamify Onboarding

By bringing fun into your onboarding process, you will not only better engage your new customers but also motivate prospects to join the game. For instance, you can create a game that will provide your customers with new features if you get a certain number of new customers by a certain date. You can even separate features into milestones and provide a new feature each time you onboard, let’s say, 500 new customers.

Give Something For Free

This hack works really well with services, especially with the tools and platforms, however, it can also be applied with products. Think about one aspect of your product or service that you can give people to try out for free, and is so good that it will make them want to buy from you. Think of this free feature as a hook and track how many users have come back and paid for the product or service after trying the free stuff you gave them.

Include Your Audience in The Making Process

What your audience thinks about your business is essential for your success, so why not ask them to participate in launching a new product or a new website, or campaign you will launch soon? You can invite your customers and prospects to participate in a contest where the winner will be chosen to be the brand ambassador. Or, you can the winner to visit your business and see the behind-the-scenes moments. This will bring you closer to your customers and show more transparency in your business.

Growth marketing team structure

What does the growth marketing team do and what are they responsible for?

As growth marketing is entirely data-driven, it will be easy to track if your strategy aligns with your objective. By constantly tracking these metrics, you will be able to optimise on time and perform better:

  • Growth Lead - responsible for building agile organizations,
  • Growth PM (Product Manager) - works on specific business metrics across the entire growth marketing funnel that will help improve business revenue and profits,
  • Growth Engineer - works on product innovation and improvement through data-driven testing,
  • Growth Designer - works on product strategy, interaction, UX design, and user empathy,
  • Full Stack Developer - implements growth techniques in the back-end and front-end of all platforms and applications,
  • Social Media & Community Manager - works on improving communication and online presence in front of the online audience,
  • Data Analyst - gathers, filters, and presents data that help the company make data-driven decisions regarding growth marketing.
Logo Airbnb & Stripe

Examples of Growth Marketing Campaigns

Many successful growth marketing campaigns proved how far a business gets with a quality strategic approach instead of focusing only on a few funnel parts.

1.Airbnb

A company started with two guys who couldn't afford to pay rent and decided to rent out their loft as a place for strangers to sleep. Airbnb is now the leading vacation rental platform, yet the company’s beginnings were very much unconventional.

The Craigslist hack: Airbnb's most famous growth tipster was to automatically post Craigslist ads before their eyes - without any approval from Craigslist.

The other Craigslist hack: Not content with its first Craigslist hack, the company later implemented a spamming bot to poach users from the website by introducing them to Airbnb. Each time users listed property on Craigslist, they would receive an automated email from a "young lady" who liked their property and suggested they take a look at Airbnb.

Product Design: Founders Chesky and Gebbia are designers at heart, and their commitment to creating the best user experience is paramount - for hosts and guests alike.

Simplification: A key component of Airbnb is that it's easy for hosts to list their properties and for people to book. The company has gone so far as to offer the host professional photos to show their property in the best light.

Market Breakthrough: To this day, Airbnb remains one of the biggest innovators in the market, turning the travel industry upside down, and its appeal among self-booking travelers is driving continued growth.

2.Stripe

A decade ago, PayPal was the only serious player in online payment, and its users were constantly complaining about its lack of flexibility and control. That’s when Stripe decided to build a payment solution. Stripe is the startup that changed the payments industry and provided one of the most impressive funding streams Silicon Valley has ever seen. Stripe is the startup that changed the payments industry and provided one of the most impressive funding streams Silicon Valley has ever seen.

Key growth strategies used:

Defining a niche: By creating a payment solution designed for developers, Stripe could address its target audience and meet their unique needs.

Identifying a need: Stripe founders and brothers Patrick and John Collison realized that while starting an online business was becoming easy for everyone, there was a distinct lack of developer-friendly payment solutions for the people who create them.

Simplification: Stripe came about because the Collison brothers were struck by the complexity and frustration of existing payment solutions. Their success is largely down to providing a more straightforward alternative.

UX design: Stripe understood that it needed to provide an excellent experience for developers and end-users who pay through it.

Leveraging community: by providing the developer community with a much-needed solution, Stripe could drive initial growth through word of mouth.

Technology adoption: Stripe remains at the forefront of technological advances, ensuring relevance. The growth of the mobile internet has helped cement the company's position as a leader in digital payments.

Stripe is now one of Silicon Valley's most valuable unicorn startups after receiving a new $600 million funding round, bringing its valuation to $36 billion.

Finding the Right Growth Marketing Strategy for Your Business

If growth marketing is what your business needs, but you lack the resources to build a holistic strategy in-house, finding professionals in the field with proven experience is what can change the future of your business. Mighty Digital has a team of growth marketing experts that can help you scale your business quickly and efficiently.

Max Zolotyi

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Demand analysis expert. Marketing Manager (Organic Channels) at Mighty Digital