Hacking Growth: How Today's Fastest-Growing Companies Drive Breakout Success

by Sean Ellis

At LinkedIn, for example, the growth team has evolved from an initial 15-person unit to comprise 120-plus members, broken down into five units dedicated to: network growth; SEO/SEM operations; onboarding; international growth; and engagement and resurrection of users.13

Michael Porter and his coauthor James Heppelmann, CEO of software firm PTC, argue in a Harvard Business Review article that the ability of companies to stay connected to their products after sale “shifts the focus of a company’s customer relationship from selling—often a predominantly onetime transaction—to maximizing the customer’s value from the product over time.”

“If you’re pushing code once every two weeks and your competitor is pushing code every week, just after two months that competitor will have done 10 times as many tests as you. That competitor will have learned 10 times, an order of magnitude more about their product [than you].”18 MINING DATA GOLD Indeed, yet another way growth hacking gives companies a vital competitive edge is by helping them make good use of the mountains of customer data that today’s new tech tools make it easier than ever to gather.

How much time our experiments dwlay?

All growth leads require a basic set of skills: fluency in data analysis; expertise or fluency in product management (meaning the process of developing and launching a product); and an understanding of how to design and run experiments.

The process is a continuous cycle comprising four key steps: (1) data analysis and insight gathering; (2) idea generation; (3) experiment prioritization; and (4) running the experiments, and then circles back to the analyze step to review results and decide the next steps.

Josh Elman, for example, highlighted just four questions that the Twitter team asked users who had gone dormant and subsequently returned: (1) Can you tell us why you signed up in the first place?; (2) What didn’t work for you? Why’d you bail?; (3) What caused you to come back and try it again?; and (4) What worked

One caution about A/B testing tools is that for all their ease of implementation, the data they provide is somewhat limited, because these tools rely on surface-level metrics, such as which button gets more clicks, rather than whether the people clicking the button ultimately become lasting users. Anyone who has clicked on an irresistible news headline only to be disappointed by the article can understand how a “click” is a poor indicator of long-term customer loyalty.

The Everpix tragedy demonstrates the importance of focusing not just on growth but on the right levers of growth at the right time.

Take Uber, whose essential metric for riders is rides completed. So in addition to the number of new people downloading the app, the company would want to track in the number of rides being booked, the number of riders who return and rebook, and the frequency with which they are booking new rides.

VIRAL COEFFICIENT (K) = INVITES SENT OUT BY CUSTOMERS × THE PERCENTAGE OF THOSE INVITED WHO ACCEPT THE INVITE

Asking so little of users is not always possible, though; you’ll often need to offer users an incentive. The best way to do this is to create a double-sided incentive, that is, one that offers something to both the sender and the recipient.

We talked earlier about language/market fit and product/channel fit; think of this as product/incentive fit.

feels highly valuable—but for Dropbox the incremental cost is exceptionally low.

How could we instead of use norml incentives (cash related) could offer something that aggregates value eg Make your first ride ans, get your first package of 3 trips or croaseling - eg your frst meal or / no delivery cost

For another company—let’s say Uber—the funnel report might display the rate at which people are downloading the app, then the opening of the app, then the number who proceed to create a new account, the rate at which people book a ride, and the rate at which they rate their driver, and so on.

it should be very brief, and should be delivered to users under two main conditions: (1) when their activity indicates confusion, such as lingering on one page for too long, or leaving the screen or page on the app or site; or (2) right after they’ve gone ahead and taken the step that many others aren’t taking, such as creating an account or making a purchase.

To recap, those steps are: map all of the steps that get users to the aha moment; create a funnel report that profiles the conversion rates for each of the steps and segments users by the channel through which they arrive; and conduct surveys and interviews both of users who progressed through each step where you’re seeing high drop-offs, and those who left at that point to understand the causes of drop-off.

DESIRE – FRICTION = CONVERSION RATE

communicate relevance, show the value of the product, and provide a clear call to action.

Influence: The Psychology of Persuasion.

“This is your moment. You have more attention than you ever will have again, from that user, to try to teach them what your product is really about. To really help them learn the product in a meaningful way.”

The power of triggers comes from two key factors: how much they motivate users to take the action you want them to and how easy it is for users to do so at the time they receive the trigger.

He divides them into three basic types, based on the motivation and ability level of the user: a facilitator trigger, which helps those with high motivation but low ability take action; a signal trigger, which helps keep people with high motivation and high ability headed in the right direction and encourages repeat action; and a spark, which spurs people with high ability yet low motivation to take action. Many email and mobile notifications fall into the “spark” category, but they shouldn’t be the only ones considered.

Refining the new user experience and getting users to experience the product’s core value as quickly as possible are two of the most important strategies at this stage.

Every time they make a purchase and are shown how much they’ve saved due to the free shipping (and often additional savings from the item list price), they say to themselves, See, the $99 is so worth it because I’m saving so much.

To make a product or service more habit forming, growth teams should experiment with providing customers with a range of rewards, and encouraging them to take action to receive them; the more action taken, the greater rewards, and the greater perceived value.

(1) optimizing the current set of product features, notifications, and subsequent rewards from repeated use; and (2) introducing a steady stream of new features over a long period of time. Getting this balance right is extremely important.

For example, in his book Priceless: The Myth of Fair Value (and How to Take Advantage of It) William Poundstone

1. Does the value metric align with where your customer perceives value? 2. Does the metric scale as the customer uses the product more? 3. Is it easy to understand?10

Conversion expert Angie Schottmuller identifies seven core factors that make reviews and testimonials effective, for which she coined the acronym CRAVENS, which stands for Credible, Relevant, Attractive, Visual, Enumerated, Nearby purchase points, and Specific.19

Airbnb leveraged the principle of liking when they reengineered their friend referral program by including a photo of the person sending the referral with the invite.

four key types of experimentation for driving growth—acquisition, activation, retention, and monetization—in

Similarly, when Uber decided to make the radical move of testing a flat-fee-per-ride version of its service, rather than the variable rates depending on the demand for cars (which as of the time of this writing was in limited testing in San Francisco only), it was a noteworthy leap from other growth experiments.