If you have an e-commerce business, maybe a SaaS company, or a startup with an online presence, you have probably heard the term “growth marketing” a lot. You have seen people rave about successful companies that have “hacked their growth” and wanted to follow in their footsteps. But you are unsure about how to start or what growth marketing even is.

It’s okay. You are in the right place. Read on to find out all you need to learn to start working on your company’s growth marketing today.

What Is Growth Marketing? And What Exactly Are the Goals of Growth Marketers?

Growth marketing focuses on maximizing the customer lifetime value at all stages of the marketing funnel at minimal cost and time.

The term “customer lifetime value” means the present value of all the future cash flows or values to the business that are associated with the customer’s relationship to the company. In simpler words, it refers to how much net profit you can get from a customer during his or her entire future relationship with your company.

So, not only does growth marketing think about customer acquisition, but it also strategizes to improve customer retention further down the marketing funnel.

A growth marketing team constantly tries to think of new ways to increase and engage with your company’s audience. It is an approach that involves a lot of testing marketing channels in order to achieve your business goals and optimize your business. Growth marketers experiment with various content and concepts until they find the one that works the best for the business.

Growth Marketing Is Important for Customer Acquisition, Retention, and More.

Growth marketers are data-driven professionals who are always thinking about improving customer acquisition, enhancing customer retention, maintaining customer engagement, and maximizing customer lifetime value in the process. 

The growth marketers experiment at every stage of the marketing funnel. Rather than just setting up some marketing channels and forgetting about it, they are constantly checking how everything is working, whether it is of significant help to the company, or whether they should switch things up. 

This also helps save time and money as you get quicker feedback on what is working and what is not. If a particular strategy is failing or at least not helping at all, then there is no sense in spending time and money on it. Time and money are valuable resources for any company and require efficient utilization. 

Moreover, growth marketing is also very important for content marketing. It helps content marketers find out new channels to communicate with their audience through writing content. After analyzing, marketers can then meld the best performing content into their growth marketing strategies. 

Growth marketing is not an overhyped trick or a  trend. Growth marketers always need to keep on top of what is happening in the digital marketing world. For example, is email marketing growing effective? What kind of digital marketing campaigns is taking the world by storm at present? What are the latest content marketing trends? 

Why Is Customer Retention Important? Isn’t Customer Acquisition All We Need to Care About?

When a customer is already a part of a relationship with you, he or she is more likely to listen to you. It will be easier for you to cross-sell or upsell products to them. 

And we are not just saying all these. There are numbers to back our claims.  

According to Harvard Business Review, retention costs 5 to 25 times less than customer acquisition, depending on your industry. So, you may have to spend up to 25 times more money to acquire new customers than you would have to hold on to your existing ones.

And that’s not all. As per a study done by Fred Reichheld, an increase of just 5 percent in customer retention can lead to an increase in profit of over 25 percent. 

Existing customers are likely to buy more from your business and say good things to others if you can manage to provide them with a pleasant experience. 

Customer retention sounds like it should be easy work. But that is not always the case. A lot of things need to be considered when working on customer retention. For example, it could be a detail like which form to post a tutorial on using a product of your company. You might think watching videos might be asking for too much from potential and existing customers. But 96 percent of people said in 2020 that they have watched videos to learn more about products, so videos may be your best bet in this case.

Thus, while acquiring new customers is important, it is also true that making a sale to an existing customer is easier. This is because he or she already trusts you. Putting effort into an existing relationship is likely to strengthen the bond you share with your customers more compared to new relationships that you are trying to build with prospective clients. 

How Is Growth Marketing Different from Traditional Marketing?

Companies using traditional marketing focuses on the top of the marketing funnel. What they try to do is induce new leads at the top (that is, attract new potential customers) and drive them down the marketing funnel until they take action to purchase a product. Lead generation is the main focus of traditional marketing. 

While acquiring new customers is essential for any business, maintaining relationships with existing customers can bring your business several excellent benefits that you won’t know until you experience them. 

This is where companies employing strictly traditional marketing miss out - they forget to put effort into maintaining good relationships with their existing customers, which is working on customer retention. The way that the traditional marketing funnel is used by most companies not optimal for growth as it focuses solely on customer acquisition. 

On the other hand, growth marketing attempts to make sure that opportunities to build meaningful relationships with customers are not missed. By focusing on both customer acquisition and retention through customer engagement, growth marketing helps a business’s client base and in turn, profits, grow. 

What Is This Funnel That We Keep Talking About?

Marketers normally use the sales funnel consisting of the stages: Awareness, Interest, Decision, and Action. 

However, for growth hackers, there is a more detailed marketing funnel with the pirate metrics. Why are they termed as such? Because the initials of the metrics line up as AARRR, a typical expression of excitement by pirates. Get ready to sail on to achieving growth, eh?

The Pirate Metrics Framework


The Pirate Metrics or Framework

Awareness

Awareness metrics include anything that happens before a customer is acquired. These consist of the amount of website traffic, paid impressions, organic impressions, search volume data, external links, and more.  Basically, anything that is related to reaching people is an awareness metric. 

The question to ask here is, how many people are discovering us? Or, how many people are we able to reach?

Acquisition

Acquisition metrics are all about how many people visit your website. These include metrics like conversion rates, click-through rates, social engagement rates, cost of acquisition, and more.  SEO, marketing campaigns, advertising, apps, and widgets -  all these efforts are related to the customer acquisition part of the funnel. 

Activation 

Activation metrics are all about how many people take that first step towards a relationship with your business. These comprise metrics like the number of sign-ups, the number of app downloads, starting free trials, lead to signup conversation rates, or the freemium to paid conversion rates.

It may also include spending a certain amount of time on your company’s app or posting a comment on your business’s platform for the first time. 

Revenue

Revenue metrics are those related to your company’s paying customers, such as the monthly recurring revenue (MRR) or the annual recurring revenue (ARR).

Customer lifetime value, which we talked about earlier on in this article, is also one such metric of revenue. 

The question here to ask is how many people have started paying and how much they are paying.

You should also like to know your break-even revenue and how much revenue you need to earn to recover your customer acquisition cost. 

Retention

Retention metrics revolve around the volume of repeat customers you have. How many people come back to your business for a second, third, or tenth time?

Obviously, a higher number of repeat customers is a good signal as it tells you that your customers are satisfied with the product or service that they have received so much that they came back again and again.  

Apart from the obvious retention rate, metrics like churn rates, customer survivability, and payback period are also retention metrics.

Referral 

These metrics focus on the customers who have become brand ambassadors.

No, we are not talking about paid social media influencers here. We are talking about general customers who introduce your brand to their friends, colleagues, and families by sharing reviews or sharing social media posts. 

This is very difficult to measure as word of mouth can spread in many different ways. However, because referrals have so much value, businesses launch referral programs as a growth marketing strategy.

What Are Referral Programs?

Referral programs are initiatives where satisfied customers are incentivized to introduce their social networks to the company’s products or services.

Since word gets around social media pretty quickly, it is a good place to implement referral programs. Online businesses are often seen rewarding customers for inviting members into their groups or asking customers to post positive reviews. 

Viral loops are great for getting your customers to invite more prospects. The term “viral loops” refer to the process that a participant undergoes, starting from entering an app, and ending with the participant inviting more participants.

You can find a good example of a referral program being used by a SaaS company in Uber. Every time a user signs up to the app, this SaaS company assigns a referral code that the user can share with his friends. If a friend creates a new account using the code, both the user and the friend get their next trips free.

These six metrics are aligned with customer life cycle stages and help growth hackers understand where to focus on.

What Is the Difference Between Growth Marketing and Growth Hacking?

You probably have heard the terms “growth hacking” and “growth marketing” together a lot, sometimes even being used interchangeably. But, there is a difference between the two. Growth hacking falls under the broader concept of growth marketing.

Growth marketing tells you to grow your audience, test different marketing channels, and focus on both customer acquisition and retention. By contrast, growth hacking is about implementing a single tactic on a single channel to grow your audience typically at an affordable price.

Guide to Growth Marketing

Below are some pieces of practical advice on how to get started on growth marketing and some growth marketing strategies.

Involve Customers in Product Development by Asking for Feedback

Do not hesitate to get feedback after launching the very first version of your product or service.

Aside from getting direct, clear feedback, this will also help you earn your customers’ trust and establish good relationships. Don’t wait till you think your product has evolved to its final, as perfect as possible version. 

You can even ask your friends and family for their honest opinions. Ask them if it is something that they would pay the amount you charge for. 

A/B Test

A/b test is a very basic growth marketing strategy that enables you to get feedback. For running an a/b test, you need to create two variants of the same piece of content, such as web pages, advertisements, graphics, emails, copywriting pieces, etc. You can then show the two versions to your audience and see which one drives up conversion rates more. Using analytics, you can keep the better performing version.

Test Away

Growth marketing is very data-driven. As per Sean Ellis, a startup advisor who first coined the term “growth hacking,” high-velocity, high-tempo testing is needed for growth.

Brainstorm ideas with your growth marketing team, assign priority to them, then implement them. And don’t stop at just implementing ideas. Set KPIs and measure your progress. Keep the good bits and discard the bad ones.

Optimize Funnels

Start with optimizing your landing page because that is the first thing anyone sees when they visit your website. Make it as easily navigable as possible and insert your call to action buttons in relevant places that are easy to reach and click. 

This may sound like a minor issue, but trust us when we say that it is not. Even the slightest of delays in loading can have significant adverse effects on your conversion rates.

A delay of even one second can cause a drop of 7 percent in your site’s conversion rates.

Instant gratification has almost become the norm nowadays. No one will wait for even one whole minute for a slow website to load. 

Keep your home page as intuitive and pleasing to the eye as possible.

Make Sure to Address the Entire Marketing Funnel and the Pirate Metrics

As we mentioned previously, traditional marketers focus only on the top of the funnel and stop there. Growth marketers, however, know how important it is to work on the whole funnel to improve customer retention. 

Besides optimizing your website’s landing page, concentrate on working on the other parts and elements of your website, such as your content marketing strategy and monetization strategy. Improving things like this can help you recover your customer acquisition cost. 

Put Social Media to Good Use When Implementing Marketing Strategies

Social media can help you enhance your growth efforts significantly. You can improve customer engagement a lot too. 

It is a great place for word of mouth to spread, so be careful of how you use social media. 

We understand that all this might sound a bit overwhelming or too much to handle at once by yourself. But you don’t have to go at it alone. Content Guppy’s team of professionals is here to help your website rank and your company grow to its maximum potential.

Referral Programs

Since word gets around social media pretty quickly, it is a good place to implement referral programs. Online businesses are often seen rewarding customers for inviting members into their groups or asking customers to post positive reviews. 

Viral loops are great for getting your customers to invite more prospects. The term “viral loops” refer to the process that a participant undergoes, starting from entering an app, and ending with the participant inviting more participants.

This is a common growth marketing strategy that holds a significant amount of power.

Conclusion

We won’t lie to you. Growth marketing takes continuous hard work. You have to pay attention to a lot of things if you want sustainable growth for your business. 

However, you don’t have to do it alone. If you need help, Content Guppy is always here for you. Our team of dedicated professionals will work on formulating the perfect SEO strategy for your business, create a content brief, hire an excellent writer, carry out a rigorous copy-editing process, and finally, ensure perfect on-page optimization.

If you want to check the process out for yourself, all you need to do is spend only 37 seconds to schedule a free demo. Get started on your growth marketing journey today!