Growth Hacking: Useful term or meaningless buzzword?

Growth Hacking

Is growth hacking a useful term? Or just an empty buzzword?

OK, I’ll admit it. I wasn’t a big fan of this term first time I heard of it. It seemed like just another term for user acquisition. Yet, a few years later I found myself accepting the title of Head of Growth at Yahoo. It wasn't entirely due to Sean Ellis' seminal post on the growth hacking. And it's not just because Growth Hacking has its own Wikipedia page now. So what changed? Before getting to that answer, let’s hone in on a definition of Growth Hacking. Which answer (below) do you think defines Growth Hacking?

A growth hack is something that:
• Costs little to no money
• Rapidly grows customers, engagement, retention or revenues
• Results from experimentation
• All of the above

I'm going with D, all of the above. Businesses have always had certain tools that might fit these criteria. SEO might be an example. “Guerilla marketing” (yup, remember that one?) might similarly fit the bill. But technology has changed a lot in the last few years and greatly magnified the toolkit that also meets those criteria. So lets drill into the reasons why.

Hello, SaaS World

The first titanic shift that gave rise to the term “Growth Hacker” is SaaS and mobile apps. Ok, and Cloud and Big Data tool while I’m busting out all the big buzzwords du jour.

There were always applications, but they never sent back copious data like SaaS and mobile apps. And that’s the difference. Back in 2007 I was at Intuit and there was a team called “In-Product Marketing”. And that team had a driblet of data being send back from the QuickBooks desktop software for a teeny subset of users who opted-in to this. And yet it held enormous business value. Later I was at Adobe and again we had a small set of data coming from the software downloads and it too was highly valued.

When you have millions of people using a product every day and you can now track, view and act upon their every keystroke to feed back into their experience, that is powerful. Meanwhile, both companies were in the process of converting their entire business to SaaS. The two big benefits to SaaS were more predictable revenues AND more data.

Over the last decade, more and more business-critical, high-value applications have moved from being CDs or downloads to being data-connected applications. This gives rise to growth hacking in two ways: data and deployments. First, now you can see what all users are doing all the time and track the impact of small tweaks to their behaviors. Secondly, SaaS applications are primed for continual deployments. So you can make changes every week based on the data you collected the week before. When you can make changes to Intuit Quickbooks or Adobe Creative Suite every week instead of once every year or two – it is a massive sea change.

So putting this together, continual releases and keystroke-level data puts a lot of power in the hands of the product managers and engineers. Now the product team can make the most of the agile scrum cycle and become experimenters.

This is all very similar to the transformation that was going on in marketing 5-8 years earlier. A/B testing completely changed how marketing teams launch webpages. And now product teams are using experimentation to drive changes to the product.

This shift is actually quite dramatic. The role of product teams changes in real and material ways. The classical model was sales telling marketing what features or products customers were asking for. Marketing (specifically Product Marketing) would translate that into the market requirements document (MRD) and a go-to-market plan. Product Management would be responsible to take MRD and develop the next click down into the product requirement requirements document (PRD) and then wrangle engineers, QA and designers to develop the product over a 12-24 month waterfall development cycle.

Once the product launched, it was Sales & Marketing who was responsible for selling it. If it turned out the product was released on time and functioned according to spec, but the sell-through wasn’t there, then it was Product Marketing who was blamed for misreading the market needs or screwing up the go-to-market strategy.
Product Management was only responsible translating strategy into a functioning product.

But now with SaaS and mobile apps, these lines are blurred. This evolution has led to a place where incremental changes and experiments inside the product experience can be measured and traced to some behavioral outcome.

Now Product Managers can now rapidly change things in the product, and see the results, and make additional changes based on that data. With these ingredients, they can now be responsible for growing engagement, reducing churn, and bumping up revenues. That’s huge!

So this is part of the argument for why Growth Hacking is a real thing that is novel and valuable as a concept. It’s also why some argue against it, saying it is just part of what product management is. And really there is some truth to both sides because they’re not mutually exclusive.

#Social Media

The second contributor to the term growth hacker is social media. Who would have thought that over 1 billion people would all be on the same social platform? Who would have thought many people get their largest daily helping of news and entertainment from a feed compiled almost entirely by their friends?

So now you can make changes inside the product experience that could potentially get customers sharing your message to their friends. Now the product manager can experiment with tricks and incentives. “Hey Customer. I’ll give you this special goody... but only if you tell your friends.” And so we no longer just engineer the base functionality, we now engineer social dynamics to drive more customers. The same toolkit of the Growth Hacker can be used to grow new customers as well as engagement, churn reduction and revenue.

As it has always been, it is perceived to be sexier to get a new customer than it is to save an existing one. But now the Growth Hacker has dominion over both worlds.

Implications for Change Management
When you put this all together, the term Growth Hacker represents a new way of hiring, training, evaluating, and organizing your team. A Product Manager must certainly be more than a project manager and also more than even the central hub to synthesize requirements from different stakeholders.

Rather, the Growth Hacking Product Manager must be fluent at a/b testing and experimenting. She must versed in behavioral economics and the science of influence. She is no longer focused on releasing features, but rather focused on increasing new customers, engagement, retention, and revenues. Features are just a means to an end now, where that connection from A to B is illuminated in full color for all to see.

Even the definition of “feature” morphs from the narrow scope of something you might list on a Features page for the prospective customer to something broader that includes any functionality in service to growing new customers, engagement, retention, and revenues.


At the end of the day, I believe the term Growth Hacker has significant meaning and critical implications for any SaaS or mobile company. On the other hand, for a consumer packaged goods company selling tissue paper, for example, the term may not add quite as much. Nonetheless, marketing AND product teams at any type of company nowadays would be foolish to not continually re-engineer their product to maximize value from social media networks and amp up the conversation and retention around their offering.

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