What is growth marketing?
The term “growth marketing” has risen in popularity recently, but what does it actually mean?
Some companies use it as a synonym for performance marketing, while others append the word “growth” to existing titles to cast the role as more quantitative or experimental.
While there’s some debate as to what growth marketing truly is, and how much it actually differs from traditional marketing, it’s an area of marketing with great impact and lasting power.
What is growth marketing?
Growth marketing is a data-driven approach to marketing that leverages experimentation, data, technology, and automation to achieve measurable business growth goals.
Growth marketing is often positioned in contrast to brand marketing, which seeks to holistically raise the awareness and affinity of a brand.
It’s also often positioned in contrast to “traditional marketing,” which tends to focus on the top-of-the-funnel activities like awareness and customer acquisition. Instead, growth marketers optimize the full value chain from acquisition all the way to down to monetization, retention, and customer referrals.
Growth marketing is more of an operating system or a mental model. It requires testing different channels, tactics, and strategies, and quantitatively measuring their effectiveness or impact. In this way, growth marketing is more science than art (though it is also quite creative when done well.) Growth marketers lead through hypothesis, cohorts, and conversion rates.
Growth marketers are often hired to build and optimize specific channels , such as SEO or conversion rate optimization. Sometimes, a growth marketer is a generalist whose job is to test more broadly and choose the highest impact channels.
Growth marketers look for repeatable and compounding efforts sometimes called growth loops. While singular campaigns like public relations efforts or email blasts can feed into growth marketing programs, they’re not usually the core focus.
By measuring and analyzing key metrics such as customer acquisition, retention, and referral rates, growth marketers can refine their strategies to optimize their campaigns for maximum impact.
Not everything is growth marketing
Growth marketing is a specific subset in marketing at-large, yet modern job descriptions attach “growth” to a title with little difference in the actual job requirements.
Paid acquisition, performance, and demand generation marketers are often grouped together and called “growth marketing managers,” however by doing this the point of a growth marketer gets missed.
Let’s use demand generation as an example:
A demand generation specialist may use top and middle of funnel marketing tactics like paid ads and webinars to build awareness and create interest in a product or category. While they may care about what happens after the event, their primary goal is to generate interest in the event.
A growth marketer on the other hand would focus on a wider range of goals, for instance: Click-throughs from the ads, conversions on the webinar landing page, live attendance rates, engagement during events, post-webinar followup, and sales demos booked.
They may run continuous A/B tests throughout the customer journey to find the optimal headline, image, and copy that drives the most results, then implement those learnings into future endeavors.
Businesses can apply growth marketing principles to demand generation, however, to be done effectively, should be considered separate functions.
While all marketing can and should generate attributable growth for a business, growth marketers are defined by their methodologies, reliance on experimentation and data, and on their position in the org chart (they often sit much closer to product teams).
Growth marketing vs. growth hacking vs. growth product management
Sometimes growth marketing is mistaken for growth hacking. Both often include a scrappy ethos, creativity when executing a concept or campaign, and a general experimental mindset.
Yet, growth hacking is more concerned with short-term results rather than growth marketing overall with the aim to measure information over time.
Growth initiatives can occur in marketing organizations and product organizations. One usually helps the other. Growth product management works more closely with engineers and product designers to develop features that not only drive customer satisfaction, but meet or exceed business growth metrics like new users, referrals, and user monetization.
Key components of growth marketing
Growth marketing functions vary company to company but most growth marketing roles contain the following components.
Growth marketers are sometimes called “T-shaped marketers.” Instead of being a specialist in a specific niche or area, growth marketers tend to exhibit a broader base of skills, while also having a deeper skill set in one or two specific areas or channels.
Because growth marketing is channel and tactic agnostic, growth marketers need to be adaptable and nimble, especially if they are helping grow a company during its earliest stages.
New companies don’t necessarily yet know the most effective channels or methods to get information to customers and bring them in. Growth marketers must use data, experimentation, and research to find and scale the right channels.
Data and measurement
Almost every marketer’s role concerns data and measurement. For growth marketers, data and impact measurement are foundational to what they’re trying to achieve in scaling a company.
Growth marketers usually set up their own tracking especially for marketing analytics (such as setting up LinkedIn Insights tags), monitoring it often. They have strong data literacy and set up dashboards to track campaign performance, read cohort reports, and analyze A/B tests with precision.
Growth marketers use data to help tell a different story about a company. There is a creative flair in how growth marketers source and use their data in analysis and execution. These are analytical marketers looking for any growth lever or opportunity available.
Experimentation
Experimentation is a defining characteristic of growth marketing.
In a marketing experiment, these marketers take different data sourced through research and customer feedback to come up with a hypothesis and measurable benchmarks. Then, they analyze results to gauge efficacy.
The most common type of business experiment is an A/B test, where a control (the existing version of an experience) is tested against a variant (a new version of the experience). Statistical analysis is used to determine what, if any, effect the intervention has had.
Growth marketers deploy A/B tests, and other broader experiments, to test out new tactics, channels, and strategies.
For example, a growth marketer may believe that, in addition to a business’s inbound marketing channel, they could benefit from investing in outbound sales development. Instead of pouring a ton of time and money into it, a growth marketer can set up a minimum viable experiment to see if outbound sales development warrants further investment. This is not only a way to de-risk new investments, but a great way to encourage innovation and constant tinkering.
Customer feedback
Customer feedback is the lifeblood of any company, and especially useful for the marketers helping them to scale.
Growth marketers are known to maintain close relationships with customers through surveys, interviews, and market research.
Quantitative data is extremely important for any business. Customer feedback is useful to integrate into overall goals and metrics because this feedback helps marketers bring customer concerns to campaigns, marketing copy and messaging, and further experiment to encourage more customer satisfaction.
Strategic agility
Growth marketers need to be nimble—and strategic. They can’t rely only on one tool, tactic, or channel for success, and must be willing to move fluidly through many in order to find the best results for a business.
Growth marketers operate without strong dogma or channel preference. To growth marketers, it depends on what the biggest opportunity is for a business. What if SEO is the channel that works best at the moment? Maybe paid acquisition channels are stagnating. Growth marketers need to monitor what’s happening and seek ways to optimize or improve campaign efforts to get more impact.
There’s often a strong level of alignment needed between growth marketers and product or business leadership to understand what the product is meant to achieve, how it’s being communicated to customers, and experiment with familiar or new channels and strategies to lead to greater results.
Full funnel focus
The marketing funnel sometimes dictates where marketers use their efforts and how their roles are shaped. The top of the funnel may mean customer acquisition through a role like brand awareness. Demand generation may be middle to bottom. It all depends but growth marketing usually touches every part of the marketing funnel and following the entire customer journey, start to finish. This includes customer acquisition, but also activation, retention, monetization, and referrals.
Depending on the stage of the company, one growth marketer may be in charge of the entire funnel (common at early stage startups), or growth marketing may be split into separate teams, each in charge of one part of the funnel. For example, a mature organization may have a growth marketing team fully focused on user activation and onboarding.
How does growth marketing work in practice?
Growth marketers work to identify areas where a business can improve its marketing efforts to acquire or retain customers, testing different hypotheses to see what works best. How does it work practically?
First, growth marketers collect data and build their growth model. A growth model helps explain how a business or product is growing. It defines each step of the process, establishes baseline metrics, and allows growth marketers to identify the most impactful growth levers and channels.
After identifying core focus areas, and using that data in addition to customer feedback, growth marketers turn those into hypotheses for experiments. These experiments could be iterative changes to a signup experience, or they could be innovative experiments testing out entirely new channels or strategies. Growth marketers prioritize these experiments by strategic importance, potential impact, and ease of implementation.
All growth marketing efforts are in service of a macro-goal or key performance indicator (KPI), often referred to as the North Star Metric (NSM). This could be anything from increasing website traffic and improving conversion rates to boosting customer retention and increasing revenue.
Why use growth marketing?
Growth marketing is an effective role that helps businesses, particularly new or start-up organizations, scale in a short amount of time.
Growth marketing initiatives can help businesses acquire, retain, and monetize a customer base at a quicker pace because the marketing arm is dedicated to overall scale and growth goals versus other marketing departments. By testing and optimizing marketing campaigns made from growth marketing work, businesses can keep working toward standing out in a crowded marketplace and outpace competition.
Moreover, growth marketing provides a clear framework for growth, which can be especially beneficial for early-stage startups still figuring out their marketing strategy.
By experimenting with different marketing tactics and measuring key metrics, marketers gain valuable insights into what resonates with an audience and what doesn't. They can iterate very quickly instead of investing a lot of money up front.
How to run a growth experiment
Getting a growth experiment up and running takes a few steps. These experiments are in a broad category and can be tailored to whatever a company needs to know in order to improve the business. They can include rigorous controlled experiments,like A/B tests, but sometimes they’re looser in nature, testing channels, and strategies. Before running a growth test, look to the following steps for guidance.
1. Identify core focus areas
The most important skill a growth marketer needs is the ability to focus on the right problem.
Before running experiments, growth marketers must analyze the funnel and identify areas that most need improvement. This may include increasing traffic to the website, increasing conversions to an email list, or improving the user activation rate of a product. They can run the gamut of the marketing funnel but make sure to be focused and honed in on an issue that can handle an experiment.
2. Develop a hypothesis
A hypothesis is a proposed explanation made with evidence as a starting point. It’s a statement of what is believed to be true today, and leveraged to form the basis of a marketing experiment.
A hypothesis is necessary for designing the experiment and metrics needed to measure success.For example, let’s assume a growth marketer identified website conversion rate as being a growth lever. The business gets a lot of traffic, but conversions are lower than the industry average. A growth marketer will conduct customer research, such as user testing and customer interviews, which may determine that the value proposition of the business’s website is unclear.
A hypothesis could be:
“We believe that organic website visitors are not converting because they do not understand the value of our product.”
3. Design an experiment
Once a hypothesis has been developed and chosen as important to test, it’s time to design an experiment.
Experiment design needs to serve a purpose and have clear expectations for an outcome. An experiment needs to help determine if changing part of a business plan or product has a certainty of impact that will help grow the business.
Most experiments have the following components:
- A control and a variant
- A goal metric
- A defined time window to collect data
Some experiments are straightforward, like running an A/B test on website copy. In this case, a growth marketer can set a time window to collect an adequate sample size, set up two versions of the website, and run a statistical test to see the difference between the two versions.
Some experiments are more complicated, such as testing out a new channel. For example, SEO often takes a long time to work. A reasonable length to run the experiment may be 3 - 6 months. The goal metric would be improved keyword rankings week-over-week or month-over-month. There are a lot of factors and monitoring involved in more complex experiments such as this but they work to sustain an improvement over time rather than be a quick fix.
4. Collect data
Data is an important component of growth marketing experiments. Depending on the length of the experiment, data collection timelines will shift. Changes may be monitored week-over-week or monthly or even quarterly. Such data sets important to growth marketing experiments include conversation rates, traffic, open-rates for email or newsletters, keyword ranking, and new customer data.
5. Analyze the experiment
Once a marketing experiment finishes up, it’s time to analyze every part of it. Do the results match the hypothesis? Are the results inconclusive and require more testing? Did the experiment fail? Data will tell an interesting story if it’s allowed. Create strong measurement goals for success to understand if a test can be more broadly applied to ensure overall business growth is possible to achieve.
6. Make a decision
Ensure the experiment leads to next steps. Sometimes, in the early stages of experiment design, growth marketers may create next steps for both success and failure. If the test was for improved organic traffic and SEO was the focus, some next steps may include refreshes website copy to optimize for certain keywords, creating net-new blog content to capture more traffic, or investing money in optimizing search in a more aggressive way.
No matter the case, next steps are crucial to help wrap up a test.
Growing a company takes time, experimentation, and strategy. Growth marketing helps to achieve growth goals with data, testing, and focused areas to run measurable KPIs. While any type of growth may be good for a business, it’s far better to engage in growth marketing techniques and strategies, keeping focused on one area to another, to ensure growth can be sustained, and not collapse.
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