Growth Hacking - Part 2

Growth Hacking for Retention, Referral, and Revenue

In the early stages of growth hacking, we focused on acquisition and activation, but retention is the true driver of sustainable growth. Without strong retention, all efforts to acquire users will be wasted as they drop off, leading to a "leaky bucket" scenario. Solving for retention first ensures that users stick with your product, setting a strong foundation for growth.

Retention Growth Hacking

To grow through retention, it's key to:

• Identify patterns among repeat users.
• Replicate those patterns to bring back more users.

Some effective tactics include:

• Personalized drip email campaigns.
• Targeted Facebook ads.
• Notifications about product updates or launches.

Once you've implemented these tactics, track retention with cohort metrics and behavioral segmentation to spot trends and address drop-off points. Use tools like Mixpanel or CleverTap to analyze segments based on actions, like account creation or first purchase, and monitor how retention improves.

Referral Growth Hacking

Referral growth hacking leverages your current user base to acquire more users. Essentially, it’s the modern take on word-of-mouth marketing, which is both economical and authentic. However, users will only refer to a product they trust and enjoy, so first, optimize your product's user experience (UX).

For example, Practo refined its product experience before launching referral programs. Key elements like referral rewards, notifications, and messaging were optimized to enhance results.

The main metric here is the viral coefficient (K factor):

• A K factor of 1 means each user refers to another.
• A K factor above 1 means exponential growth.
• Below 1, you're in decline.

Keep in mind, that the viral coefficient has a shelf-life, so it’s important to continually evolve your referral strategies as your product matures.

Revenue Growth Hacking

Finally, revenue growth hacking focuses on increasing your paying customer base. It involves:

• Maximizing conversions at every stage.
• Engaging customers.
• Reducing churn.

Tactics for revenue hacking include offering discounted annual pricing, introducing small paid plans ($1 plans to capture contact details), enhancing discount pages, and using scarcity tactics like countdown timers to encourage purchases.

Also, alliances and bundled deals can boost revenue, as hosting providers often do. The key metrics to track for revenue growth are monthly run rate, growth rate, and revenue channels. Focus on optimizing high-performing channels and minimizing low-performing ones.

Growth hacking doesn’t always result in a smooth hockey-stick curve of growth. You’ll see highs and lows, but by sticking to these principles, your product can achieve steady and sustainable growth.