Growth Hacking

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The beginner’s guide
to growth hacking
A guide to growing your user base
and revenues with lean marketing
By Christopher Carfi Frederik Hermann

Building a sustainable business and product is hard work.
Growing your user base is even harder. Markets and opportuni-
ties are changing on a daily basis; you have to stay focused and
constantly improve your tactics in a rapidly-changing world in order
to succeed.
The tactics that worked even a few short years ago are now
obsolete. Iterative sprints leveraging mobile, social and location-
based approaches and powered by data and insights, are required
in order to thrive. Through rapid experimentation, you can find
yourself in a healthy loop of building, testing, measuring, lear-
ning, refining and improving.
On the following pages we want to share some insights with you
that will help you grow your user base, keep them engaged and
ultimately grow your revenues.
WHAT TO EXPECT

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05 what is growth hacking
07 the lean marketing funnel
09 setting up your analytics
11 a/b and multivariate testing
13 creating landing pages
15 the many ways of inbound marketing
17 mastering email marketing
19 paid channels remarketing
21 public relations
23 building viral mechanisms into your product
25 activating your audience
27 retention – keeping your customers happy
29 organic search
31 conclusion
table of contents

Engineering Marketing
Experiments
SUCCESSES!
GROWTH HACKING

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The term growth hacking describes a data driven test and measure
approach to reaching, converting and retaining customers on a scalable
basis.
Growth hacking is about the creative use of scalable and repeatable
methods with the goal to optimize every digital touchpoint in order
to get prospective customers to take action.
The term does not describe one specific method, but is rather a
philosphy, an approach at the intersection of marketing tactics and
product development, inspired by analytics and data – constantly
testing, measuring and refining.
Growth hackers are often a hybrid of marketer and coder as the
discipline of marketing is shifting from people-centric to API-centric
activities. A growth hacker is a person whose true north is growth.
“Growth is not a one time gimmick.
There is no silver bullet.”
James Currier, Co-Founder at Ooga Labs
what is growth hacking?

“The principal objective of growth hacking is to create a user
acquisition coefficient that is higher than one. For example,
a company should aim to have more people using their product
over time than it loses from attrition. By experimenting with
different growth hacking methods, companies can determine
the optimal means to increase that coefficient dramatically.”
– Andy Johns

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The marketing process is often metaphorically described as a funnel
illustrating the theoretical customer journey towards the purcha-
se of a product or service. This results in one of the most critical
questions:
How do you move users from one state to the next?
Your efforts need to be focused on optimizing the conversion from
visitor to customer. Here we want to break up this user flow into five
discrete stages (inspired by Dave McClure's startup metrics for pirates,
short AARRR, and Mattan Griffel's corresponding blog post):

Acquisition People come to your homepage or other landing
pages from various channels (owned, earned, paid).
Activation This means converting visitors who are having a
good first experience on your site through a call-to-action to sign
up for your service or give you their email address for more
information.
Retention Once people become active users of your product,
coming back to use it multiple times and staying engaged
each time will be crucial for the long-term success of your service
and your revenue pipeline.
Referral Your goal is to achieve a viral coefficient greater than 1,
meaning your customers referring your service and inviting their
friends results in at least one of these referrals to sign up as well.
Revenue Growing your revenues as a company either through
advertising, subscriptions, or by simply charging for your products
and services.
the lean marketing funnel

Referral
Acquisition
Activation
Retention
Revenue

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Asgrowthhackingisaverydatadrivenapproach,itisessentialthatyou
have the analytics tools in place that allow you to measure the effec-
tiveness of the experiments and tactics you are deploying. Google
Analytics in combination with Google Webmaster Tools are a good
way to start, but then there is a whole range of useful tools:
Like Optimizely and Unbounce for A/B testing, Mixpanel and KISS-
metrics for funnel metric tracking, Qualaroo and SurveyMonkey
for user feedback as well as Crazyegg and UserTesting.com just to
name a few.
Before you get started with any experiments create a time stamp
with Moz's www.opensiteexplorer.org and save some of the basic
metrics (your page authority, domain authority, page mozrank,
page moztrust) as well as your Google PageRank, Alexa rank, current
traffic sources, etc simply to have a reference point in the future.
You are now aiming to measure user engagement throughout the
funnel and user acquisition cycle, like what are your users clicking
on, where did they come from (traffic source), where are they drop-
ping off, how much time are they spending on your site, how much
did it cost to acquire this user and much more.
Google Analytics Signing up is free and all you need to do is drop a
few lines of code into all the pages you intend to track. I recommend
event tracking on buttons and links and to create “goals” mapping
paths through your website and their goals (eg. sign-up or download).
Facebook Insights Facebook has some good insights about your
Facebook profile, demographics and usage at https://www.face-
book.com/insights and I also recommend claiming your domain via
the green “Insights for your Website” providing you further insight
on actions where people have posted a link to your site, how often
posts with a link to your site have been viewed and how many
people have clicked through to your site from Facebook.
Twitter, App.net, Pinterest and others also allow you to claim your
domain to receive more detailed analytics and insight on engagement
and traffic generated through those platforms.
Google Webmaster Tools Make sure to add your website, blog
and corresponding XML sitemaps to the webmaster tools for fas-
ter and more accurate site crawling and detailed search analytics.
Search engine Bing provides a similar webmaster tool as well.
setting up your analytics

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A/B testing, also referred to as split testing, is a method of website
optimization in which the engagement and conversion rates of two
different versions of a page, A and B, are compared to one another
by splitting live traffic onto both versions. A multivariate test uses
the same core mechanism but compares a higher number of varia-
bles and how these variables interact with one another.
We often test more than just two versions and currently use
Google Experiments as a great free A/B and multivariate testing tool
(it is part of Google Analytics and you can find it under the “Behavior”
tab on the left). Make sure you set up your “Goals” (e.g. sign up) in
advance and create the different pages you want to test against one
another (6 different landing pages, for example, with different web-
site copy, button colors or imagery). Then you provide the original/
control page plus its variations to the tool and paste a few lines of
Javascript code into the control page (standard landing page), Google
Experiments will now route incoming traffic to all 7 pages (control
+ 6 variations) and allows you to measure which one converts better
than others. Your goal is to optimize the conversion rate.
Highrise (37signals) is a popular example as they tested a lot
of different landing pages against one another, gradually and
successfully improving conversions. Make sure you run your
changes/tests against a control group (A/B test) to measure the
difference. Small changes in copy or design can drive huge differen-
ces in conversions. Don't be afraid to throw a drastic change into
the mix (a super simplistic landing page with few words and a big
button for instance), be creative and measure the results.
a/b and multivariate testing

Layout 1 Layout 3Layout 2
30%CONVERSION
60%CONVERSION
40%CONVERSION
Layout 2

A “landing page” is a purpose-built web page for lead capture or
customer conversion. Typically, a landing page has a singular goal:
to provide enough value to the visitor that they take the next step to
becoming a customer or lead.
Focus – keep it simple and don’t distract your visitors.
Create a headline that effectively gets your message across (be
descriptive, you already got this visitors attention) and follow up
with short and compelling copy describing your most important
attributes (benefits, problem you’re solving, features).
Create a clearly visible call-to-action, don’t distract with lots of other
requests – the best pages accentuate only one CTA.
Shine with visually clean and simple design; more white space keeps
people trained on your call to action. Big fonts make it easy and
compelling for them to read and understand what your site is all
about. An additional video can summarize a lot of information into a
small space and can increase conversions dramatically.
Make sure the most important information is displayed without
having to scroll (above the fold), works in many different resolutions
and systems as well as mobile screens!
Keep in mind that you don’t need to know it all in advance, that’s
what A/B testing is for. You can test multiple different headlines and
simply measure which one resonates the best with your visitors and
yields the best conversion rate.
creating landing pages

Inbound marketing is a highly effective way to generate awareness,
convert customers and give advocates something to talk about. In a
world where advertising is increasingly “tuned out,” the creation and
sharing of media and publishing content is paramount to achieving
business goals.
Inbound marketing focuses on online channels and their usage. By
providing value in the form of information and making that information
findable via search (SEO) as well as distributing it through social
channels, prospective customers learn about the brand driven by
their interests, rather than as a result of interruption marketing or
outbound cold calls.
Blog posts 1-3 times / week, with content useful to your customers
Social media distribution Share content to Facebook, Twitter,
Google+, LinkedIn, Slideshare, Medium, Reddit, Quora, Tumblr,
StumbleUpon, etc., based on which channels are most relevant to
your prospects and customers
Other blogs Participate in conversations relevant to your brand
and industry without being spammy
Email newsletters Twice a month, not too long, ONE call-to-action
Guest posts Write them first then offer to others
Ebooks Visually appealing, on-topic, with designated landing
page for lead generation
Videos Short video (less than two minutes) almost always wins
Others Infographics, how-to guides, case studies, whitepapers
the many ways of inbound marketing

Blog posts
Guest posts
Social media
distribution
Ebooks
Other blogs
Videos
Email
newsletters
Others

Although email has been much-maligned over the years, it is still
one of the most effective channels for engaging with your customer
community and nurturing your prospects. A few things to keep in
mind:
Make it easy to get on your list Don’t bury your subscription
box in a sidebar. There are plenty of site and blog plugins that do
a great job of asking folks to join your list and then getting out
of the way. The best plugins will allow you to configure how often
they are shown to visitors, which enables you to ask newcomers
to join, while not overly inconveniencing your regular site and blog
visitors.
Start the flywheel right away When someone joins your list,
send them a welcome email. Include a short note of thanks, but
also include a link to a bonus piece of content for subscribers
of your list. They just went through the effort to sign up as a result of
interest in your brand, reward them with another bit of insight that
can help them achieve their goals.
Keep the drumbeat going Regular but not-too-frequent emails
keep engagement up and keep your brand top of mind without
beeing spammy or annoying. Twice-monthly is a good frequency
to start with for newsletters, which can be scaled more-or-less
frequently based on the information you can deliver and its time-
liness and value to your readers.
Plan and execute Keep an editorial calendar for your emails,
just like you do for your social channels. Know what items are going
to be in which edition and get the writing done early, if you can.
Test relentlessly If you have the luxury of a large list, don’t
be afraid to A/B test different subject lines to small subsets of
your list to see which ones get the best open rates. Once you have
your message dialed in, then you can send the newsletter to the
broader group. If your list isn’t large enough to allow segmenta-
tion of the list to do this type of testing, make it a habit to write
15–25 possible subject lines before choosing one. (Little known fact:
The Onion writes all of its headlines first, and then writes the articles
for the best ones. You can do the same.)
mastering email marketing

The available media channels are often divided into three main
categories: earned, owned and paid. We have already covered many
of the “owned” inbound marketing channels and will talk about the
“earned” channels in the next chapter but an important catalyst can
be efficiently deployed with “paid” media campaigns.
Paid channels are often referred to as “traditional advertising” like
the various forms of online advertising (display ads, text ads, video
ads, sponsored search, affiliate marketing, email advertising) but
also sponsorships, print ads, television, radio, direct mail and retail.
With the resources and budget of a startup I recommend focusing
on the online rather than any offline channels as they are usually
much more cost effective and targeted.
Start off by testing different channels with a small budget (e.g. $100–
$1000), measure the conversion rate and double down on the ones
that perform well for you.
This is also a great way to test different messaging (how you
describe yourself as a company and your services), creative (images
and photos), regions (countries and languages) as you can measure
what resonates best with your potential customers.
Popular channels are: Google AdWords, Facebook, Twitter, LinkedIn,
Bing/Yahoo!, YouTube, StumbleUpon, BuySellAds, Flurry and Tapjoy
(for mobile apps). Using a new platform earlier and more effectively
than others can give you great competitive advantage (usually at
lower cost too), so make sure you keep some of the newcomers in
mind like Instagram, Tumblr, Twitter, Pinterest, Reddit and others.
You can use AdStage to manage campaigns for multiple platforms
within one dashboard.
If you are selling a product (software or hardware) you should think
about retargeting. Retargeting means to re-market your services
and products to users who have previously visited your website.
Retargeting helps you bring back the visitors who haven’t converted
yet. A popular player in this category is AdRoll.
paid channels remarketing

Public relations has changed a lot over the years, but can still play
an important factor in getting your story in front of the right people.
Nevertheless, at the early stages of your company I recommend
focusing your efforts on your product and execution, measuring,
learning and adapting instead of investing too much time and money
into public relations or even hiring an agency. You will be better off
being able to showcase market validation and traction than early
promises you might fall short on.
If you have found product/market fit, identified your target audiences
and want to invest into public relations you can start building a list
of journalists, bloggers and influencers in the industries that align
with your target audience. This can vary greatly depending on your
product or service, eg. marketing and advertising outlets versus a
lifestyle and entertainment audience.
1) To identify key reporters and influencers in a certain vertical
you can use a Google search but also services like Little Bird, Klout,
Kred, Traackr, Quora, WeFollow, Alltop, PeerIndex and others.
2) Build your own list of influencers in a Google spreadsheet with
their name, outlet, contact details and social profiles. Rapportive is
a great tool to find the right email address.
3) Read, listen and engage on social media first. Start building a re-
lationship over time.
4) When you have something to say (like traction, funding, a large
trend emerging, launch of something new, the disruption of a market
or industry) make sure to start the conversation in advance (weeks
ahead). Most journalists need some time to schedule an interview
and some time to research and write their story.
5) Maintain the relationship and be a great contact. Maybe you have
some news to share that are simply industry-related but are not
necessarily about you.
6) You can also comment on stories or trends by signing up for
HARO (Help a Reporter Out) as journalists are often keen to get
industry insight (a quote attributed to you) for a specific story or topic.
public relations

You might create the next great viral marketing video. You might not.
However, the odds are stacked against you that your brand will create
the next Gangnam Style. Instead, it’s better to build viral mechanisms
into your product and strategy itself instead of hoping that marketing
lightning will strike.
The fact that people actively share is itself an area worthy of con-
versation. With all of the other demands on our time, why do
people bother to actively share to Twitter or Facebook or Pinterest
or a blog? Research from the New York Times indicates that the key
reasons are:
» To bring valuable and entertaining content to others
» To define ourselves to others
» To grow and nourish our relationships
» Self-fulfilment
» To get the word out about causes and brands
Make sure your product or service addresses aspects of those five
motivators.
There are actually two key types of viral components that can be
considered as part of product design, according to Harvard resear-
chers Sinan Aral and Dylan Walker. Both active and passive sharing
can be built into a product.
Active sharing Users of your service actively share the product
or content with their networks (e.g. Facebook Likes, Twitter shares,
etc.). Active sharing is more persuasive.
Passive sharing Your service automatically shares your activities
on your behalf to your networks (e.g. Spotify “now listening to” type
updates). Passive sharing generates more hits.
building viral mechanisms
into your product

There are three ways your audience can take action:
» They can buy from you
» They can tell others about you
» They can be defenders of the brand
It’s great when a prospect buys from you, obviously. As it’s been
noted, “nothing happens until a sale is made.” That said, a truly
engaged community member can become a key member of your
organization’s ecosystem in a number of ways in addition to simply
handing over some cash.
The terms “influencer” and “advocate” get used quite often,
sometimes interchangeably. However, they are quite different.
An influencer is an individual who shares their opinions with their
(large) networks. In contrast, an advocate is someone who feels
so strongly about the brand that she chooses to participate in the
public conversation about the brand, and will even defend the brand
itself. Apple “fanboys,” CrossFit enthusiasts and drivers of the iconic
MINI who participate in cross-country road rallies are all examples
of advocates. These individuals don’t just talk about these brands,
they make the brands part of their personal identity.
Activating the influencers can amplify and accelerate the spread
of your message. Give your influencers sample posts that they can
modify and share, ensure that they know about your offering and
run awareness campaigns to keep them in the know.
There are a number of ways to activate your advocates.
» Give them advanced knowledge of new products and
features –keep them in the know
» Give them ways to include the brand into their personal identity
» Involve them in product definition and give them access to
company executives
» Perform actions that enable them to develop trust in your brand
» Give them a sense of belonging, make them part of the “club”
Engaging in these five advocate-building behaviors at an organizational
level can reap huge rewards. While influencers can help spread the
word, they can be fickle at times. Advocates, on the other hand, include
the brand into their own identity. As such, an advocate who sees or
hears someone degrading the brand in their day-to-day travels will be
more likely to defend the brand, as the brand is part of them.
activating your audience

Small improvements in retention have huge impacts on profit. (e.g. in
a low-margin business, reducing defections by 5% can increase profits
anywhere 25% – 125%). In other words, customer retention is critical.
One overlooked aspect of retention is to start with the right customers.
Force-fitting customers into a solution that doesn’t help them achieve
their goals might help your sales team meet their initial quarterly
revenue goal, but will come back to bite the business in later months as
those customers churn out. Every customer lost needs to be replaced
just to stay where you are. Ensure that the customers you are marke-
ting to are a good fit for your business, and vice versa.
Once the customer has agreed to do business with you, aim for a stellar
onboarding experience. Ensure the customer knows how to get the
most value out of your product or service. Additionally, take a measured
approach to training and the overall onboarding process. You may
have a hundred great whiz-bang features, but learning to use a new
product always involves some level of learning curve, even in this age
of downloadable apps. Making sure your customers can walk before
they can run will reduce their frustration as they ramp up their skills
with your product, which will enable them to start seeing immediate
value. Simplify.
Products, services and markets inevitably change. Minimize surprises
with frequent communication with your customers through news-
letters, social channels, surveys and regular check-ins. Transparency
and dialogue are the watch words here.
No product is flawless, and neither is any customer experience. Ensure
direct support, whether through call center, email support or chat,
is timely and helpful. Strive to create a customer community, where
customers are helping customers. (Not only does a robust community
help your customers get service faster in many cases, they can often
self-serve the solutions to their questions, actually driving your support
costs down while improving retention. That’s a win-win for everyone.)
Last but not least, ensure that your social channels are monitored
regularly. Listen and respond to customer issues and, where appro-
priate, direct customers who are having challenges to a higher-touch
channel if necessary.
Develop a culture of inquiry. Take the time to survey your customers
on a regular basis. Interview those who stay... and those who go. Both
groups will provide insights that will help you to understand what fac-
tors are keeping customers around, as well as the factors that may be
contributing to attrition.
retention – keeping your customers happy

Customers are 40% more likely to tell others about a bad
customer experience than a good one. An unhappy customer
will tell 9 to 15 people about the negative experience.

Optimizing your website for organic search is an art and bu-
siness of itself but there are a few easy things that you can
do right away that will set you up in a good position. Try not to
game the system (as Google might punish you for it), rather think
about the ways potential customers might be looking for you or a
service like yours and what words/keywords would they choose.
The key thing you should optimize is the page’s content itself (head-
lines and copy), so avoid masking text within an image as a search
engine won’t be able to read and analyze it. Apart from the page’s
content, pay attention to the page title, URL and image names (give
all images a descriptive title like paid_marketing_channels.jpg
instead of IMG364.PNG).
Make sure all the pages you want to be crawled are linked to from
within your website and linked to one another, search engines
usually come in through a popular entry point and then follow all
links within that page, ranking them accordingly. Choose relevant
words for the anchor tag itself especially when linking to content
within your blog’s archives for instance.
Create an XML sitemap (most Wordpress SEO plugins do this auto-
matically) and submit it to Google Webmaster Tools as well as Bing
Webmaster Tools.
Use descriptive URLs, avoiding URLs lik yourdomain.com/11789/
s201.htm and rather use something like yourdomain.com/resour-
ces/guides/email-marketing-field-guide/ instead.
Reduce the use of Flash and frames.
Your content needs to be fresh - updating regularly and often is cru-
cial for increasing traffic. A blog is the perfect tool to do this.
Share links through social media channels and especially make sure
your links are posted on Google+.
Backlinks are still majorly important for your Google PageRank, so
start building relationships and linking to others in your blog. Media
mentions with a link back to your website can be very helpful here.
organic search

The new marketing is all about agility and experimentation, built on a
foundation of the basics of branding, product and story. Analytics and
testing are paramount — since customer abilities and expectations
are changing on a monthly, or even daily basis, we must constantly be
evolving and improving our abilities to connect with customers in an
ever more complex marketplace.
While analytics and testing will tell us what is working, the means
we use to obtain permission for even engaging in a conversation
with a prospective customer has changed as well. No longer can
we rely on the interruptive techniques of the Mad Men era. Instead,
we must challenge ourselves every day to create content that helps
our customers achieve their goals, and not just blow our own horn.
While outbound marketing still has its place, especially early in the
lifecycle of a new organization or product, the benefits of embracing
inbound marketing are exceptional.
The ultimate goal, of course, is to obtain a deep understanding
of product/market fit, and synthesize product design, marketing
and engineering in such a way that, once the product achieves
critical mass in the marketplace, self-reinforcing loops and customer-
to-customer conversations propel the product forward.
We hope you have found at least one new thing, or one new insight
in this e-book. As always, we would love to hear your feedback.
Thanks!
conclusion

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