It’s easy to be cynical about growth hacking. After all, pursuing and achieving business growth isn’t a new concept.
But growth hacking isn’t just about describing marketing activities in a sexier way. It involves a different set of skills and techniques compared to “regular” marketing. And it may bring useful lessons to those trying to launch their business internationally.
What is growth hacking?
Coined in 2010, growth hacking describes the very narrow and specific pressure points that are applied during the early days of a startup when the only objective is growth.
Other marketing disciplines, such as stakeholder engagement or managing vendors, aren’t as relevant during this period when every decision taken is informed by growth. For this reason, growth hacking often brings in other skills, such as technical ones, enable accelerated and accumulative growth.
Growth hacking case study: Airbnb
Any discussion of growth hacking invariably mentions Airbnb, the hugely successful accommodation marketplace that used growth hacking techniques to become a global phenomenon.
Airbnb reverse engineered the ad posting mechanism on Craigslist (a major US community noticeboard) in order to reach a wider audience with its room ads. This tech hack allowed them to tap into Craiglist’s massive user base across the United States by using engineering skills that would be outside the remit of most marketers (some of Airbnb’s other early growth hacks are morally dubious, such as spamming people posting their own room ads on Craigslist to bring them across to the platform).
It’s worth saying that the essential element to Airbnb’s success has been the fact that people very much want the service provided by the platform – connecting people with a spare room to those who wish to rent it from them. Demand from overseas users was vital to taking the business international. But Airbnb also needed to use time-consuming, resource-intensive techniques in some parts of the world in order to kickstart growth. These were far more low-tech than the Craigslist hack.
In France, the company focused on very specific tourist destinations with local events and used targeted marketing in order to encourage both renters and guests to participate on the platform.
Using a human presence (rather than, say, Facebook ads) emerged as the most effective way to drive growth in these key locations.
Airbnb took some liberties – spamming Craigslist posters and reverse engineering the ad posting function – in order to achieve rapid growth. The founders took on board the adage to “ask for forgiveness, not for permission” in order to access an existing user base and piggyback on the success of the massive Craigslist platform.
Part of the nature of growth hacking is that it often involves the use of ingenious and tech-based solutions that innovate and push boundaries of what is acceptable. This emphasis on growth and innovation at the expense of all else is the essence of growth hacking.
Is growth hacking just for start-ups?
The approach taken by growth hackers is not unique to startups looking to rapidly scale up. These techniques can also deliver value for established brands expanding overseas.
Established brands have more to lose from morally questionable tactics, so they perhaps need to have more integrity than the young Airbnb displayed.
While already fairly well established worldwide, Facebook took an innovative and aggressively acquisitive approach to expanding its user base in Russia. The company purchased keywords based on the most common first names in Russia to exploit the fact many new Russian internet users were searching for their own names in search engines, or those of people close to them. This helped the platform expand in the country. This was an innovative growth tactic that wasn’t morally questionable and worked well for the company.
Growth hacking techniques that make the best use of low-cost but smart tech solutions can help businesses expand internationally.
When Hotmail was looking for ways to expand its email platform, the company took the decision to add “P.S. I love you – get your free email at Hotmail.com” at the bottom of every user email. This simple footer had the effect of adding an average of 3000 extra users a day.
When a single email was sent to an Indian contact, 300,000 Indian users were added within three weeks. Not many growth hackers are lucky enough to see this viral effect. Perhaps the difference between an ambitious growth hacker and a spammer is merely that the market is more receptive to what the growth hacker is offering.
Common growth hacking tactics
Growth hacking doesn’t have to be digital. It just involves thinking outside the box. And growth hackers can maximise growth effectively from existing on- and offline marketing tactics.
Q&A site Quora encourages anyone posting a question on their platform to share with their own network via Twitter. Contacts seeing that someone they know has posted on the site can view the original post, and they will also see related questions to encourage them to explore Quora further. The site is set up to maximise viral reach.
Another area of growth hacking is to encourage member-get-member acquisition by offering discounts to users who invite their friends to participate.
Airbnb offered $25 of credit to users who signed up other users. In a similar move, Paypal offered a joining bonus of $10 to people signing up to the payment site; an approach which raised the member base in the crucial early stages of the service when building a user base was more important than initial profitability of the new joiners.
Uber is currently using a similar approach to support its international expansion strategy, but it’s not the only transportation network company to pull off some audacious growth hacks. To even out supply and demand side, ride share app Lyft paid drivers to sit in their cars in order that passengers would always find a driver on call for them.
And the practice can even be seen in dating. Notorious online dating service Ashley Madison created fake female profiles to draw in male users and overcome the issue of gender imbalance on the website.
Facebook insisted 20% of a student body had to sign up before a school or college could go live on the site. And most recently, a Latin American startup called Social Tools grew their business from 150,000 users to 2 million in 170 countries in five months which they attributed to spending their marketing budget on acquiring a popular but unprofitable Dutch social media company called Postcron.
However, international marketers should be aware of growth hacking techniques that are likely to cause damage in the long term or backfire for cultural reasons should be avoided.
Music lyrics and annotations website Rap Genius was penalised by Google for using spammy SEO tactics disguised as an affiliate programme.
Recovering from a Google penalty is difficult but regaining users’ trust after a betrayal can be much more challenging. Circle, a local news app, rocketed to the top of the the App Store in 2013 with the use of an incredibly aggressive invitation process which sent SMS invites to everyone in a user’s contact list when they allowed the app to access their contacts. This led to Circle being described as the world’s least favorite app and forced the company’s CEO to issue an apology and remove the annoying functionality from their app.
So, marketers that decide to experiment with growth hacking are advised to create localised tests to determine levels of success and to consider the culture of their target audience in the design of growth marketing experiments. And, as always, it’s a good idea to involve a team of experts in the language and culture of the target region to avoid any potential mishaps.