Optimization glossary

Growth hacking


What is growth hacking?

Growth hacking (also known as 'growth marketing') is the use of resource-light and cost-effective digital marketing tactics to help grow and retain an active user base, sell products and gain exposure. Think ‘hacking’ in terms of life hacks – those little shortcuts that make your life easier – rather than nasty bits of code that can ruin your computer and your life.

Growth hacking is most commonly associated with start-ups and small businesses, i.e., those organizations that don’t have a huge amount of cash to spare but need results quickly. However, it’s a scalable concept applicable to any online business looking to maintain the growth and retention of an active user base.

The difference between growth hacking & traditional marketing

Many people think of growth hacking and marketing as one and the same. However, there are subtle yet important differences.

Growth hacking is like marketing in that its ultimate aim is customer acquisition or to encourage more people to use a particular product or service. However, because of its origins within the start-up community, it relies heavily on tactics that don’t involve spending massive budgets to which larger businesses have access.

Typically, growth hacking combines marketing, optimization and developmental know-how to pull off automated marketing on a small budget. For example, automated notification emails, simple sign-up forms or sign-up driven homepages or streamlining onboarding for new customers.

What is a growth hacker?

Someone whose profession is growth hacking is known as a ‘growth hacker’. This term was first coined by Sean Ellis, founder and current chief executive of GrowthHackers.com, who, among a wealth of other positions, was head of growth at Dropbox.com.

In a 2010 blog post, Ellis wrote:

“A growth hacker is a person whose true north is growth. Everything they do is scrutinized by its potential impact on scalable growth...”

“An effective growth hacker also needs to be disciplined to follow a growth hacking process of prioritizing ideas (their own and others in the company), testing the ideas, and being analytical enough to know which tested growth drivers to keep and which ones to cut. The faster this process can be repeated, the more likely they’ll find scalable, repeatable ways to grow the business.”

From Ellis’ quote alone, it’s possible to see the intrinsic link between growth hacking, A/B testing and optimization. Data is at the heart of growth hacking, and the hacks must be tested to determine what is effective and what isn’t.

Benefits of growth hacking

  • Provable ROI – By using data to inform every decision you make, and tracking the performance of a hack accurately, you can easily see which of your growth hacking strategies are performing as you’d hoped, and which aren’t. Persevere with those that show promise for customer acquisition, discard those that don’t.
  • Low-cost – By its nature, growth hacking is designed to use whatever resources you have in as economical a way as possible. This means using tactics like ensuring landing pages are leveraging SEO best practices to rank highly in search engines for important keywords. Also writing impactful content such as case studies and then sharing broadly on key social media channels is a great tactic. Extensive and iterative A/B testing can be powerful as well to quickly gather user data. Although the testing process may be fairly lengthy before hitting upon that golden nugget, growth hacking doesn’t have the traditional costs associated with it that other methodologies such as content marketing or advertising do.
  • Low-resources - Growth hacks are often developed and implemented by a single person on the product or engineering team, and don't require an entire marketing team to execute.

Criticisms of growth hacking

In recent years, the practice of growth hacking has been criticized by some for focusing on quick hacks and shortcuts rather than developing an in-depth marketing strategy. Others have argued that growth hacking is just traditional marketing given a new and fancy name.

Due to these and other critiques, some growth professionals have started calling themselves "growth marketers" in order to distance themselves from negative connotations of the term "hacking."

The term "Growth Hacking" is a deceptive one, however, as growth teams and professionals more frequently focus on deeply understanding the data of your website's conversion funnel, then seek to identify where the areas of friction are and optimizing each step to improve the overall conversion rate.

While there are the big bang hacks that get discussed frequently, many noted below, more often growth is about deeply understanding users and iterating how to make the most seamless experience for them across all touch points.

Finally, a successful growth strategy requires a product-market fit. Trying to grow and optimize a product that is pre-product-market fit puts the cart before the horse.

Examples of growth hacking

Here are some examples of well-known growth hacks that have been successful in generating massive results for top tech companies:

  • Hotmail – ‘Get your free email at Hotmail’ with a link to the sign-up page automatically added to users’ signatures
  • LinkedIn – One-click endorsements for existing connections
  • YouTube – Making it as easy as possible for people to share YouTube videos on their own sites by providing embed codes
  • Twitter – Automated notification emails
  • DropBox – Incentivized ‘refer-a-friend’ tactic to get new users
  • Airbnb - cross-posting all new listings on Craigslist for free

Testing what works and discarding what doesn’t is at the heart of these successful growth hacks – and so many more. Only through a consistent process of hypothesizing, testing and refining can the hacks that drive a business’ growth be discovered.