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GROWTH HACKING Morgan Brown

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As companies look for ways to grow their user base quickly and at scale, they've turned to the growth strategies made popular by companies like AirBnB, Quora, Facebook and others. Growth Hacking at its core is the discipline of marrying product features with distribution tactics to get massive user growth with very little paid marketing spend. This presentation reviews popular growth hacking case studies, how you can evaluate your product for growth hack opportunities, and how to get your team and product focused on growth for 2013. Get our designing for viral growth infographic here: http://bit.ly/12badgO Learn more about digital telepathy here: http://www.dtelepathy.com/

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Page 1: Growth Hacking Basics

GROWTH HACKING Morgan Brown

Page 2: Growth Hacking Basics

ABOUT ME

•  12+ years of user acquisition, social and product marketing for startups.

•  Grown companies from 0 – 100k+ users in months 3 times.

•  Get geeked out about viral growth and product-oriented hacks.

•  2nd time here at OCPM – hoping to earn a 3rd.

Page 3: Growth Hacking Basics

WHAT IS GROWTH HACKING?

•  A methodology that leverages strategies aimed at unlocking growth at scale.

•  Growth by being smarter, not spending more, than the other guy.

•  The practice of finding exponential upside to marketing investment.

Page 4: Growth Hacking Basics

WHAT IS A GROWTH HACKER?

•  Hybrid skill set of marketing, product & engineering.

•  Ability to optimize for user acquisition at scale.

•  Ability to drive exponential growth from efforts.

Page 5: Growth Hacking Basics

WHY GROWTH HACKING?

•  Traditional marketing and growth channels are expensive and hyper-competitive.

•  Companies that are resource constrained can’t compete effectively in crowded spaces.

•  It’s about creating an unfair advantage by leveraging asymmetries in the market.

Page 6: Growth Hacking Basics

TENENTS OF GROWTH HACKING •  OBSESS OVER DATA

–  Know your customer exceptionally well. –  Measure everything.

•  CREATIVITY

–  Think different. –  Push the limits.

•  CURIOSITY –  Learn early, learn often. –  Poke around.

•  DIRTY HANDS –  Get in at the code & product level. –  Make, launch and break stuff.

Page 7: Growth Hacking Basics

CATEGORIES OF GROWTH HACKS

•  Platform integrations

•  Viral Growth

•  Analytics

•  Grab bag

Page 8: Growth Hacking Basics

PLATFORM INTEGRATION

Leveraging Super Networks

Page 9: Growth Hacking Basics

AIRBNB & CRAIGSLIST

•  Insight: –  Craigslist is where people were looking for rooms to rent, short

& long term. –  They could cross-post to Craigslist and tap a huge traffic

source.

•  Hack: –  Even without an API the AirBnB team figured out a way to

hack the Craigslist submission process.

•  Result: –  AirBnB drove more bookings (making customers happy) &

created new users at the same time.

Page 10: Growth Hacking Basics

AIRBNB & CRAIGSLIST

1.

2.

Page 11: Growth Hacking Basics

AIRBNB & CRAIGSLIST

3.

4. Source: http://www.quora.com/Airbnb/How-does-Airbnb-automatically-post-on-Craigslist

Page 12: Growth Hacking Basics

BRANCH OUT & FACEBOOK

•  Insight: –  People maintained a professional network on Facebook that was

often more engaged than on LinkedIn. –  They could leverage the size of Facebook and its Open Graph

permissions to drive growth.

•  Hack: –  One click invite send and account creation with Facebook

Connect. –  Which friend would you rather work with mechanic.

•  Result: –  Doubled size in a month. Went from 1MM to 10MM users in 3

months. Raised $24MM. –  BranchOut mostly irrelevant now. Why?

Page 13: Growth Hacking Basics

BRANCH OUT DOUBLES IN 1 MONTH

http://www.quora.com/How-did-BranchOut-double-within-a-month

Page 14: Growth Hacking Basics

YOUTUBE & MYSPACE

•  Insight: –  MySpace was where fans connected with musicians, but bands

couldn’t post video. –  If YouTube could make it easy to share video on MySpace

they’d instantly scale.

•  Hack: –  One click, Flash-based embeddable widget for video. Bands

and fans could finally watch and share music videos. –  Which friend would you rather work with mechanic.

•  Result: –  By 2006 YouTube’s reach grew past MySpace. The rest is

history.

Page 15: Growth Hacking Basics

TAKEAWAYS

•  Integrations should make both products better

•  Study (and ask about) user behavior to determine promising integrations

•  Test and discover valuable use cases

•  Measure conversions and revenue

Page 16: Growth Hacking Basics

VIRAL GROWTH Leveraging Friend Networks

Page 17: Growth Hacking Basics

DROPBOX •  Insight:

–  Traditional marketing wasn’t working. Were spending $300+ to acquire customers for a $99 service.

–  Activating customers was the key to paying accounts. –  Their asset had a very low marginal cost to give away.

•  Hack: –  Giving away free space in exchange for word of mouth referrals. –  Giving away free space in exchange for activation.

•  Result: –  Users sent 2.8 million direct referral invites in April 2010. –  In Sept. 2008 the service had 100,000 registered users. –  In Jan 2010 (15 mos.) the service had 4,000,000. –  No traditional ad spend.

http://www.quora.com/What-are-the-dos-donts-of-referral-invite-programs

Page 18: Growth Hacking Basics

DROPBOX MAKES INVITES FUN

http://www.quora.com/What-are-the-dos-donts-of-referral-invite-programs

Page 19: Growth Hacking Basics

LIVINGSOCIAL

•  Insight: –  Building an audience can be outside of the core product

experience. –  The cost of giving away a deal is shared by the merchant, giving

away deals cheaper than giving away cash.

•  Hack: –  Building a purely viral Facebook app called Pick Your 5, and

growing virally until pivoting to daily deals. –  A new twist on refer-a-friend with the 3-and-free dynamic.

•  Result: –  10’s of millions of Facebook app installs –  70MM users as of 11/12

Page 20: Growth Hacking Basics

LIVINGSOCIAL’s PICK YOUR 5

Page 21: Growth Hacking Basics

TAKEAWAYS

•  Viral growth doesn’t exist for every product.

•  Viral growth comes from value being created for the existing and new user.

•  Viral growth doesn’t have to come from your core product.

•  So many people use refer-a-friend. A twist is required to stand out.

Page 22: Growth Hacking Basics

DATA Deep insights to drive growth.

Page 23: Growth Hacking Basics

AIRBNB

•  Insight: –  Listings with better photos get more bookings.

•  Hack: –  Hacked product and customer experience to drive professional

photos for listings. –  Saw that listings with pro photos received 2-3x more bookings.

•  Result: –  Went from 20 photographers in the field in 2011 to doing 5,000

shoots per month. –  Traffic takes off.

Source: Analytics Lessons Learned

Page 24: Growth Hacking Basics

AIRBNB CRACKS THE PHOTO CODE

Source: Analytics Lessons Learned

Photographers  

Page 25: Growth Hacking Basics

CIRCLE OF MOMS

•  Insight: –  Not all users are created equal.

•  Hack: –  Discovered that moms on Circle of Friends were far more

active than other users: –  Pivoted entire company from Circle of Friends to Circle of

Moms.

•  Result: –  Grew from 2MM monthly active users to 4.5MM –  Sold to Sugar Inc.

Source: Analytics Lessons Learned

Page 26: Growth Hacking Basics

HOW MUCH BETTER WERE MOMS? •  Their messages to one another were on average 50% longer.

•  They were 115% more likely to attach a picture to a post.

•  They were 110% more likely to engage in a threaded (i.e. deep) conversation.

•  They had friends who, once invited, were 50% more likely to become engaged users themselves.

•  They were 75% more likely to click on Facebook notifications.

•  They were 180% more likely to click on Facebook news feed items

•  They were 60% more likely to accept invitations to the app.

Source: Analytics Lessons Learned

Page 27: Growth Hacking Basics

TWITTER

•  Insight: –  It’s not how many Tweets you send. It’s how many people you

follow that determines success. –  When users follow 5-10 people they are far more likely to

remain an active user.

•  Hack: –  Drive product onboarding not around publishing or building an

audience, but following the right people.

•  Result: –  40% of Twitter’s users use Twitter without publishing. –  4x number of monthly visitors who don’t login, just read the

stream.

http://www.avc.com/a_vc/2011/09/the-logged-out-user-continued.html

Page 28: Growth Hacking Basics

TWITTER’S TRY FIVE

Photographers  

Page 29: Growth Hacking Basics

TAKEAWAYS •  Sometimes growth doesn’t come from where you expect it.

•  Leverage data to identify unique insights and opportunities.

•  If you think you have a worthwhile idea, test it quickly and

with the least effort possible.

•  Have a game plan of what to do if the idea succeeds and how to scale it.

•  Iterate the product to solve for that use case that drives growth.

•  Engagement is the rocket fuel to give you escape velocity and long-term sustainable growth.

Page 30: Growth Hacking Basics

PHYSICAL & OTHER HACKS

Growth Hacking requires creativity.

Page 31: Growth Hacking Basics

HACK GRAB BAG

•  Embeds –  YouTube, SlideShare, Vimeo –  Keys are: remove friction, optimize for SEO

•  Powered By –  Freemium with branding, CTAs & backlinks: MailChimp, UserVoice –  Keys are: identify what you “power”, track and test CTAs

•  Free Stuff –  Viral tools that play to vanity/exclusivity: Klout, Twitter Grader –  Keys are: Identify value/desire, provide reward or currency

Source: Hiten Shah’s Growth Presentation (see notes)

Page 32: Growth Hacking Basics

WALL STREET JOURNAL

•  Insight: –  Busy business people are constantly searching for ways to

connect to the Web.

•  Hack: –  Offer free WiFi at popular spots across New York City. –  Create email capture and activation funnel as part of

connecting to the Web.

•  Result: –  Every user an opportunity to build their email marketing lists.

Source: GrowHack.com

Page 33: Growth Hacking Basics

DOLLAR SHAVE CLUB

•  Insight: –  In a massive CPG category traditional advertising will never work,

you need to build a cult following. –  The big players are actually terrible at branding and marketing.

•  Hack: –  Upend the business model for razors. –  Use viral video to acquire customers at low cost and create that

cult following.

•  Result: –  DSC video viewed 5MM+ times –  30,000 subscribers in first week –  Raised $10MM to take on men’s category

Page 34: Growth Hacking Basics

ZAPPOS

•  Insight: –  With items that are hard to shop for online, superior service, not

price, will win. –  Removing friction from online shopping is more important than

price.

•  Hack: –  Reinvent what customer service means. –  Bake cost of incredible service into product, position as free.

•  Result: –  World renowned brand built on service. –  Charge a premium on every item sold. –  $800 million exit to Amazon.

Page 35: Growth Hacking Basics

TAKEAWAYS •  Growth Hacking isn’t just for consumer companies. B2B and

physical product manufacturers can hack growth.

•  Physical product hacks are harder, but not impossible. They just require creativity and insight on how to reach users.

•  Hacks that make use of digital networks eliminate overhead

costs and find scale.

•  Same rules apply: creativity, data, curiosity, dirty hands.

Page 36: Growth Hacking Basics

BECOME A GROWTH HACKER

Or at least a growth beginner.

Page 37: Growth Hacking Basics

YOU NEED A TEAM & A HYPOTHESIS

•  Create a growth team. –  Marketer –  Product person –  Engineer –  Sales

•  Create hypotheses about growth. –  What changes do you think will move the needle? –  What types of customers do you need to sustain growth? –  What types of habits and behaviors do you need to engineer? –  Map to customer decision making.

Source: Adam Nash http://blog.adamnash.com/2012/04/04/user-acquisition-viral-factor-basics/

Page 38: Growth Hacking Basics

GET DOWN IN THE DATA

•  Know your customers inside and out.

•  Go where your early adopters are.

•  Go niche first, the world second. –  Hipsters –  Moms –  Geeks

•  Look for insights and patterns that represent opportunities.

Source: Zero to a Million Users: http://www.slideshare.net/adamsmith1/from-zero-to-a-million-users-dropbox-and-xobni-lessons-learned

Page 39: Growth Hacking Basics

ID HACKING OPPORTUNITIES

•  What platforms could I integrate into that would bring instant scale? –  Don’t depend on just one. –  Don’t just think Facebook.

•  What are the core features of my product?

•  Which ones drive growth? How can I optimize those?

•  How can I build distribution into inherent actions?

Page 40: Growth Hacking Basics

ID HACKING OPPORTUNITIES

•  What is the value to the user for reaching out to non-users?

•  How does a hack align with my value proposition?

•  How does this hack improve the experience of the user?

•  How can my product help others while gaining distribution?

Page 41: Growth Hacking Basics

LEARN EARLY, LEARN OFTEN

•  Test and measure ideas on the cheap.

•  Build MVP versions, concierge versions.

•  What’s the easiest and fastest way to ship an idea?

•  Numbers are your guide to everything.

•  Iterate like your life depends on it.

Page 42: Growth Hacking Basics

GET STARTED Get Hacking.

Page 43: Growth Hacking Basics

GIDDY UP! •  Review product and marketing opportunities.

•  Build your team.

•  Read and learn.

•  Become a growth beginner.

•  Celebrate growth in your organization.

•  Make 2013 the year of growth!

Page 44: Growth Hacking Basics

THANKS.

Page 45: Growth Hacking Basics

DESIGNING FOR VIRAL GROWTH •  Get the inside scoop on designing for viral growth with this

infographic from Digital Telepathy:

•  http://www.dtelepathy.com/blog/design/design-viral-growth

Page 46: Growth Hacking Basics

GET IN TOUCH Morgan Brown [email protected] @morganb Digital Telepathy www.dtelepathy.com @dtelepathy

Page 47: Growth Hacking Basics

REFERENCES // RESOURCES •  Taking your site from One to One Million Users – Kevin Rose •  Hacking Growth at SlideShare •  Growth – Hiten Shah •  From Zero to One Million Users – DropBox and Xobni

Lessons – Adam Smith •  Growth Hacking 101 – Your First 500,000 Users – Yong Fook •  Lean Analytics – Alistair Croll & Benjamin Yoskovitz •  Andrew Chen’s Blog