What’s Your Story - Vision and Validation Week 1 Welcome to the EntreLaunch Online Accelerator Program.
Customer Development Week 2
Revenue and Finance Week 3
Branding and Design Week 4
Startup Legal Week 5
Marketing Week 6
Introduction to Growth Hacking
It was 26th of July, 2010 – Sean Ellis, an entrepreneur, angel investor and startup advisor, wrote a blog post. And for the first time, he coined a new phrase in the marketing terminology: Growth Hacking.
Since then Growth Hacking became a popular approach especially for startup marketing.
First let’s start by defining Growth Hacking. Growth Hacking is the set of tactics and best practices for dealing with user growth. The main task of Growth Hacker is to figure out how to move users from one level of funnel to the next one.
Within this approach actually Growth Hacking sits at the intersection of Marketing, Data Analytics and Programming. At this point allow me to share some good examples from Growth Hacking so that you get to understand the approach better. I will start my favorite one. The story of Hotmail, the first growth hack in history.
In 1996, developers Sabeer Bhatia and Jack Smith was working on their free email service.Their intention was to have a small web-based emailing platform to keep the bosses from monitoring their private messages. They have raised 300.000 USD from investors and took a standart marketing approach by pouring thousands of dollars int billboards, radio ads. But it seemed to be not working so their discussions among themselves and also with the investors was around one key point: How can the company get new users without a significant marketing budget? As a note this question is still being discussed so I urge you to be prepared for it.
They have found out that their most sign-ups were coming from friend referrals. With the suggestion of their seed stage investor Tim Draper, they decided to add a footnote at the end of each mail: P.S. I Love You! Get A Free Hotmail Account!
If you clicked on the blue “Hotmail” link, you were redirected to a registration page. There, you would receive all the relevant information on Hotmail’s offer. In addition, you were given the opportunity to create your own free e-mail account immediately. (That wasn’t standard at that time.)
The results were amazing. They got 3.000 new users each day reaching to 100.00 users in less than one month. Fast forwarding 6 months, they got 1 million users and 12 million users at the end of the year. Microsoft bought Hotmail for an estimated fee of $400 milion dollars.
Growth hacking is really about exploiting information or users to generate impressive and often mind-boggling gains in traffic, revenue, or users. A growth hack is typically very limited in scope. At its core, it is about forgetting the rules of traditional marketing and hyper-focusing on a core piece of your business. You’ll work with only what is measurable and relentlessly pursue growth by making data-driven decisions.
The essentials of growth hacking are:
- It is data-driver, lean marketing
- It is low-cost by implementing new innovative approaches
- Approaches that are not decided by instinct or gut reaction
With the introduction to Growth Hacking, we are concluding our sessions for Marketing. Marketing is a marathon and you need to keep your pace stable to avoid being left behind. One of my favourite quote by Philip Kotler is that ‘Marketing takes a day to learn. Unfortunately it takes a lifetime to master.’ I am hoping that you got a sense of marketing in our lectures. Now it’s your turn to apply them in your ventures.