You don’t need a growth hacker

Startups don’t need growth hackers - at first. They need products that are really working in the market. This means users love it, that there’s lots of retention and engagement, even at small numbers.

The reason for this is that ultimately working on scalable growth is an optimization problem. And it’s a combined product management and technical function, to boost an already positive growth curve into something even bigger. The analysis needed to drive user growth require a baseline of usage, whether they are A/B tests, cohort analyses, or lifetime value calculations, and the changes that make those numbers go up are product changes. The more data you have, the faster you can iterate and generate more growth.

In fact, it’s the lucky startups in Silicon Valley that end up spending a significant amount of their time on growth. Most of the startups I run into in Silicon Valley are failing because their products aren’t working yet for their customers- the reflects itself in low growth, but also low engagement numbers too. You won’t fix that just by getting more people to sign up, though it’s critical to iterate on your product with feedback and data from real users, of course.

Pre-product/market fit
When you are pre-product/market fit, and you only have dozens of friends and family using the site, you don’t have enough usage to create a baseline. What you need here is a lot of lead bullets, not one silver bullet. This is where PR, community management, partnerships, and other forms of hard-to-scale growth techniques are great. This is where you need to iterate on the product based on your own expert intuition of what it needs to be. And once you have enough usage and your product is working, then you can use some of the more quantitatively driven growth techniques.

Similarly if your product isn’t retaining users, it won’t help much to pour water into a leaky bucket. Growth without retention may increase your vanity metrics like total signups, growing your active userbase to substantial levels requires you to get beyond just signing up more users. Once you hit some saturation, things will fall apart as your user curve jumps the shark.

So again, I repeat- startups need product/market fit, not growth. Growth comes as a result of having achieved fit, and a growth team is built to optimize the curve. The real question is, how do you get to product/market fit, given that most startups fail to get there?

Early product work is incremental and intuitive
If you’re a startup with minimal users and weak usage, keep iterating on product and doing the hard work of building an initial community. If you think adding some Twitter sharing will help your value prop, then implement it- you don’t need to tune or optimize the functionality until you have some scale. If you think that your landing page doesn’t communicate the value prop very clearly, then just change it. You can get more scientific about it later.

At some point you’ll have enough usage to think about optimizing easy things, like signup or sharing flows. The goal is to move fast and ship a lot of product iterations to get to that usage level. But until then, it’s a waste of time to build a huge analytics system for A/B testing when you don’t have to.

It’s working? Great, now build your growth team
Eventually, if you beat the Trough of Sorrow, you’ll start to find evidence that your product is working. Qualitatively, you’ll see the same users over and over, and they’ll tell you how much they love your product. Your own personal opinion of the product will change – you may not be 100% satisfied with what you’ve built (we never are) but you’ll find some utility for it in your life. Quantitatively, you’ll have to look at other products in your space to compare, to see if you’re really there. For a social consumer product, you might look at metrics like DAU/MAU (is it 10 or 20% or higher?) or next day retention (20% or 30% or higher?) or you’ll start to see some slow natural growth that you can ramp up.

The first steps of working on growth are often super easy – figure out the critical flows in your site, like signing up and sharing, and what factors turn users into successful and active ones. Now start optimizing for that, starting with a few people working on a small number of A/B tests at a time. Based on how that goes, you can ramp it up over time.

If you can be one of the few startups that gets to product/market fit, and you need help with growth, then build up that team as needed. That’s what Twitter, Facebook, LinkedIn, and many others did- they added the growth team after signing up millions of users, and it didn’t hurt them in the long run. Try to start optimizing growth too early, and you may not have the product in place to become a long-term success.

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http://twitter.com/benchestnut benchestnut

“What you need here is a lot of lead bullets, not one silver bullet.” Niiiice!
http://www.orchestratormail.com/ Ritu Raj

Awesome blog post. I must say that I took my head out of product development, and enhancement, once I reached a stable release, and started focussing on some basic growth hacking, we have signed up a bunch of users, however dont have the infrastructure to keep them engaged.

On the other had some basic growth hacking – has revealed a lot about “how will the customers find us”, conversion issues, SEO issues etc. I think in some way its a step function.

Development -> Marketing -> Development -> Marketing etc

I have seen very good ideas, and incredible development efforts, based on some initial “customer discovery process” end up with no idea on how will the customers find you, and finally where you are in the value chain.

Check out http://objecitveli.com – manages goals and objectives in real-time.
http://wearenytech.com/64-mark-birch-investor-entrepreneur-trader Mark Birch

What we really do not need is the term “growth hacker”.
http://twitter.com/samweber samweber

That’s a great quote that I heard first via from @Benhorowitz @a16Z and was from a conversation with Bill Turpin from the Netscape days. Well placed no doubt and is almost always a accurate way to proceed regardless of what you are trying to accomplish. Nice post Andrew.
http://www.facebook.com/profile.php?id=3231528 Erin Parker

Yes! Totally agree. This resonates with what you said @nReduce – initially building your business from the “heart” and then after traction and product market fit, building it with your brain.
http://nabeelhyatt.com nabeel

Thanks for this Andrew. I preface every talk I give about instrumenting growth with something to the tune of, “this is post product-market fit playbook stuff.”

In the early days of building it is a totally different muscle.
TaylorMiles

Excellent points….sometimes too much early growth can be a major issue if you don’t have product market fit. The growth will end up masking major issues with engagement and retention.
http://andrewchenblog.com Andrew Chen

It’s funny, originally when I wrote my previous post “Growth Hacker is the new VP Marketing” I had originally written in something like “quant marketer” or “data-driven marketer” but of course “growth hacker” is so much more memorable and marketable :) I think the ubiquity of the term has as much to do with the name as anything else. Marketing win, right?
http://andrewchenblog.com Andrew Chen

:)
http://andrewchenblog.com Andrew Chen

The hard part is knowing when to transition- entrepreneurs who are optimists and overconfident tend to want to work on growth too early. Entrepreneurs who are pessimists and perfectionists tend to work on growth too late. Hard problem.
http://www.aginnt.com/ A G

Good points. Agree with most of them. Growth can be a patch to a core product-market fit problem.

Can you provide a little more detail on the difference of baking in growth into your product? I agree that you want to avoid “distribution for distribution” sakes and a growth focused product person can be a distraction to the core product team.
http://petegrif.tumblr.com/ Pete Griffiths

I think that the term ‘growth hacker’ is useful and I think your original article was important because it did point to a different style of marketing requiring different skills. Sadly the precise context of your original piece has been lost and many consider it to be simply a hip term for online marketing and because they see it this way it is easy to dis the term. I recommend such critics go back to the source (!).
http://petegrif.tumblr.com/ Pete Griffiths

Good piece.
It is remarkable how many professional investors lok for a prematurely over-structured process for customer acquisition. Doubtless it makes them feel comfortable that the company takes acquisition seriously but it is an illusion.
http://twitter.com/devsandip Sandip Dev

So u mean to say traditional marketers dont take decisions on the basis of data? Really?
http://twitter.com/DesktopAnywhere Desktop Anywhere

Solid and insightful analysis and spot on in most respects. I would add that if you are lucky enough for the sector to show solid growth over time, you might find that to be enough of a helper on growth to push your solid product rather than iterate so much. Hard in more ways than one to be ahead of the market but it happens and calls for a different angle.

Jeff
http://www.DesktopAnywhere.com
http://twitter.com/nicholasedwards Nick Edwards

Great post, thanks Andrew. As you say, when a company is pre-product/market fit they still need users to beta test and help validate the core value hypothesis (and more than a dozen family and friends). How many users/ testers is “right” for a consumer web product in your estimation?

If 10 million users is the new 1 million (according to Chris Dixon anyway) then do you think a company also needs 10x the beta testers?
http://wearenytech.com/64-mark-birch-investor-entrepreneur-trader Mark Birch

Pete, let’s be honest, many people have adopted it as a hip term because that it what people do as a way of differentiating themselves. However, know some of these individuals, I am pretty convinces they could not market their way out of a paper bag. Clever hackers yes, but clever marketers? Not so much.

And please stop assuming that people that are critics did not read the original “source”. I groaned the first time Andrew wrote of the growth hacker trend, as did plenty of others in the startup community. You might want to check out the discussion board on a recent TechCrunch article about growth hackers if you are not convinced that it is a loathed phrase.
There are very valid reasons to be wary of such fad terminology. The idea that anything different is going on is somewhat disingenuous. Having been at one of the more successful marketing automation and analytics software companies over a decade ago, I can tell you that there were plenty of tech savvy marketers that had a deep understanding of data analytics methodologies which they melded with the classical marketing skills. They then applied these techniques in a systematic, test-driven approach across multiple online and offline channels of customer interaction to ascertain the efficacy of their marketing programs.

The net is that what many present day startup hipsters think is highly original and cool is in fact what marketers are doing and have done for quite some time. In fact, data-driven, channel optimized marketing techniques have been going strong since the earliest days of direct mail marketing.

Is there something that is new with this trend? I believe there is a useful trend in that engineering teams are now becoming more sensitive to customer endpoints and user interactions. However, I would surmise that is part of an overall trend in the software development process and even faster release cycles. In turn, those responsible for managing the vision of the product are having to interact tightly with designers, engineers, and those on the front-lines with customers (community, support, partners, etc.) to deliver functionality at lightning speed. Thus, I see this as a challenge of product marketing that is perhaps more technically savvy and engineers being more customer-focused rather than a disruption of marketing. That disruption already happened awhile ago.
http://andrewchenblog.com Andrew Chen

IMHO, “marketers” don’t encompass the level of product management and resources that growth teams have been able to apply towards their goals at a company. If a marketer is able to say, spec out entirely new features and incorporate it into the core of the product, then great. But in my knowledge, most marketers don’t control any product roadmap and have minimal engineering resources at their disposal.

That’s why, in practice, “growth teams” and “marketing” are totally different animals. It’s not just jargon.

For instance, at Twitter, the growth team includes the ex-Summify features that sends out weekly digests. Same with the internationalization features, and all the new user experience steps, like importing addressbooks, features like suggesting people to follow etc. This is how things are set up at Facebook too.

Does that sound like marketing to you?

If anything, growth teams are much more a subset or variant of product management/engineering than marketing. But it’s a hybrid, which is why it gets a shiny new piece of jargon :)
http://andrewchenblog.com Andrew Chen

Not all of them- obviously many of them do, in the direct marketing world, but the other 1/2 of marketing is the world of branding, PR, etc. This dominates $100B+ in marketing spend per year, and in tech companies tends to be more important in the successful huge cos.

(I know this from working with many ad agencies at my previous startup)
http://petegrif.tumblr.com/ Pete Griffiths

Imho – the essence of the original post was not about being data driven or heavy on analytics. As I tried to point out above, such marketing techniques do indeed have plenty of precedent. To me the more novel dimension that Andrew’s post addressed was well made in his discussion of the way AirBnB hacked Craigslist. This hacking did indeed go beyond conventional marketing.
http://twitter.com/TommyGriffith Tommy Griffith

Exactly. I totally get why savvy marketers would hate this term. I just don’t believe that everyone is a savvy marketer. People think that a new word has been invented for something they’re already doing, and have been doing, so they get heated. That makes sense to me.

What doesn’t make sense to me, is that the people who seem to despise this definition say that all marketers are doing this. Really? End-to-end designing, building, measuring and analyzing their funnels? Managing email acquisition and retention? Landing page CRO and A/B testing? Packaging their product, up-sells, cross-sells or affiliate programs? Building viral factors in pre-launch? Implementing SEO best practices, creating sticky content and acquiring great links? All marketers are blurring product, marketing and engineering? Really? I think the point of the word is the distinction that it makes.

If you guys are all just surrounded and completely inundated with people that can do all of these growth hacking things, please let me know where you’re hanging out, because it sounds to me like they grow on trees.

I’m not saying this as a growth hacker. I’m not one. Not at all. I’m an SEO guy with a lottttt more to learn. In the modern tech enterprise, I think many of the growth hacking functions that have been mentioned in this discussion seem to be taken on by entire teams, not individuals. Finding all of these abilities in one person seems rare. Hence, the word. I get this.

Regardless, I think the definition of “growth hacker” and the ensuing conversation around it that has emerged over the last few weeks has been really helpful for me, so I am grateful for that if nothing else. I just don’t understand why everyone seems to have such a strong aversion to the word.

Maybe you should change the term to “Good Marketing”, you know, something more memorable :p

@andrewchen