1. Constant development, feedback, and corrective actions
Growth Hacking is constantly repeating the stages of user retention and product optimization from the first step in realizing the PMF. That is, Growth Hacker must constantly repeat the process of constant development, feedback data collection, and modification. This is because the process is the underlying business process at every moment, including before the company grows and when growth stagnates.
Amazon is a good example of how we constantly improve our products based on user feedback collected data.
Amazon employees do not try to prepare the product perfectly. From the planning stage, they publish their products on the market and look at consumer responses. They then modify the initial plan and modify it to create a final in which the consumer’s response speaks to the product’s capabilities. But that is not the end. They are constantly striving to improve their products to the products they want, even after selling many products to the market.
Amazon’s CTO Warner Vogels proposes to the company’s employees to write FAQs and manuals for the products they are developing. The reason is that if you think hard about a hypothetical scenario, you can get an idea from a consumer’s point of view.
Eventually, without PMF, any marketing activity is just a waste of time. Therefore, we should try to find improvement through appropriate input, rules, standards, and feedback rather than being satisfied with the development. Increasing the retention rate of the user enables the company to survive in the long term, so the process should continue even after the product has been optimized to a certain degree of user.
2. Increase conversion rate for core customers
If we deliver the value of the product to the right person among the prospects, the word of mouth effect can be got at the same time. The important thing here is that you turn your audience into a core customer and this core customer becomes a word-of-mouth customer. That is, the problem how to measure the conversion rate and how to target it. For this, Growth Hacker can measure the conversion rate of key customers through an analysis method called AARRR technique.
The AARRR analysis is a method of analyzing the user’s behavior in the following five steps. It is possible to change the meaning and order of each step according to the value pursued by the product.
- Acquisition: How do users know about our services?
- Activation: Does the user provide a positive experience when using the service for the first time?
- Retention: What is the rate of service re-use after using the service?
- Revenue: Is the service connected to the end goal(sales)?
- Referral: Does the user voluntarily share the content?
If you want to know more about AARRR analysis, see the article below:
AARRR framework for startup
The biggest goal of Growth Hacking is how many users will remain until the final step of the AARRR analysis. To do this, it is important to measure the conversion rate, which is an indicator of how many users are left in each step. If the conversion rate at a certain stage is low, it is also important to identify the cause and establish a marketing strategy appropriate to the cause.
The number of users remaining until the recommendation phase, which is the final stage of the AARRR analysis, is the percentage of key customers. The users remaining until the recommendation stage are the core customers, and by these, the word-of-mouth effect is naturally produced. Considering this process, one of the most important data indicators in Growth Hacking will be the “conversion rate”.
Want to be a great Growth Hacker? If so, you need to be able to analyze the data for Growth Hacking and make appropriate decisions based on it. It also requires the ability to read meaningful data from a vast amount of data.
This article referred to Ryan Holliday’s book Growth Hacker Marketing: A Primer on the Future of PR, Marketing, and Advertising.