Growth Marketing Approach to Business Growth

This month, I got a full scholarship from CXL Institute to take a mini-degree in Growth marketing. For the next 12 weeks, starting from this week, I will write about my class learnings, and infuse it with my field experience as a strategy and growth manager.

This week, I will cover what growth marketing is, the difference between growth vs traditional marketing, the mind of a growth marketer, how to build a growth process and model.

In talking about my experience, we will use ABCash to build our scenario. ABCash is a fintech company that provides p2p cash and loan services to consumers through mobile, web, and ussd channels. Paulina is the name of our growth marketer, leading the growth department of ABCash.

Growth marketing is one of those fields influenced by technology and ongoing new approaches to doing business that models the structure of a startup. When I say startup, I mean the nimble, agile, sprint, and fast environment, not the chaotic environment many may imagine.

Growth marketing is the intersection between many fields and disciplines. It tries to combine best practices from major fields to get the best outcome for an organization.?

Growth marketing has the user at the center of it, this is developing empathy for the user, understanding the users, how they feel, what they do, and how to personalize or customize our offerings to soothe their pain points. Rather than look at a demographic or geographical spread of a segment, a growth marketer digs deeper to an individual level identify within a segment or group. We care about the unit that makes the whole. In terms of technology, data, and digital, growth marketers never make decisions without data use. We have an unprecedented amount of data in the world, why should I guess? And in the use of data, technology, and digital channels, we use a scientific approach to test, prove, disprove and validate a hypothesis, run different experiments, and draw insights from data to understand the result.

This puts the mind of a growth marketer in a constant positive feedback loop mindset. A feedback loop, according to Searchenginewatch.com is “A process in which the outputs of a system are circled back and used as inputs.” In growth marketing, it means taking the feedback from your customers and using it to reform, optimize, improve your next campaigns.?

As the image below explains, while growth marketing focuses on all the funnels, traditional marketing focuses on awareness and acquisition.?

The mind of a growth marketer

-?????????Experimentation

Growth marketing is about designing a series of experiments that let us know what brings in or achieves the outcomes or the goals we want.

A growth marketer would choose a goal, design a series of experiments to achieve the goal, run the experiment using A/B testing, and decide on the metrics or value to measure.

Remember Paulina? The growth manager for ABCash, a fintech company that provides p2p cash and loan services to consumers through mobile, web, and ussd channels.

Paulina desires to increase customer referral by 20% for ABCash. As a growth marketer, she decided to run experiments, by one, offering monetary incentives for each referral, or a customer rating system or gift per referral made. According to her data sets, she would then decide to do A/B testing by pushing different messages to different customer segments. She discovered that customers are more likely to refer based on a rating system rather than cash rewards.

Also, Paulina might want to know what customers value the most, whether it is the pricing, convenience, or fast payment. She would run different marketing messaging around these themes. The outcome of this campaign would help her know what ABCash users value the most amongst pricing, convenience, and fast payment. ?

-?????????Feedback

Based on the feedback from Paulina’s experiment. ABCash as a fintech company continues to offer customer ratings as an incentive for customer referrals rather than cash incentives.

-?????????3 Layers of Depth

Growth marketing is about the right channel to reach users, the right message, and how to create a more personalized experience driving growth.

As a growth marketer, Paulina must-have channel level expertise, analytical capabilities, and strategic thinking. As she grows in her career as a manager, she is required to become more strategic and build expertise in cross-functional management ability.

How to build a growth process

-?????????Define your Growth Model

-?????????Map our customer journey

-?????????Identify goals, build road maps and execution

What is Growth Model

The most common framework is McClure’s AARRR Framework.

Acquisition, Activation, Retention, Revenue, Referral.?

As a growth marketer, Paulina must agree on metrics for each of them according to the goals of ABCash.?

Mapping your Customer Journey

You need to understand what the journey looks like from the customer’s perspective. Understanding this journey would allow you to identify funnel-specific metrics to improve the overall performance. This will enable the team to solve the customer’s pain points, reduce barriers and improve metrics?

From this user’s journey, Paulina needs to improve the referral metric of her team. This journey has shown that referral is non-existing for this user. The growth team is then prompted to understand why, from this understanding, a new customer experience will be designed to make the customer start to refer.

Paulina has a challenge on her desk. Her growth team has generated massive ideas that are worth executing. How will she be able to prioritize? Just like Paulina, growth teams are replete with executable ideas, how do we prioritize? A popular framework is the ICE Framework.

Impact, Confidence, and Effort. All ideas are put on a scale of 1 – 5, with 5 being the highest. We want to know the idea with the highest impact, confidence of success and requires the least effort and resources to execute.

This framework shows that Paulina should follow through on the “directly ask users to refer through emails” idea because it has a good impact rating, confidence of success, and the least effort to implement. Though redesigning the website has the highest impact, but the effort and resources required to deliver it are too high.

It is also worthy of note that, as a growth marketer we want to get to a position of confidence where we can predict the economic impact of any idea we execute. e.g. Paulina can say “directly asking users to refer via email will increases referral by 20% and $50k monthly revenue increase”.?

Experimentation Process

-?????????This process starts by designing your experiment. Having agreed on the idea to execute, you move into designing your experiments. An experiment is a hypothesis we want to test. A hypothesis has 3 components: independent variables, the dependent variable, and the assumption.

Paulina’s hypothesis: “directly asking users to refer through emails after their second transaction will increase referral rate by 20% and $50k monthly revenue increase because by asking them, they will feel more responsible to take action and know the benefits of referral to them as a customer”

Independent variable: directly asking users to refer through emails

Dependent variable: increase referral rate by 20% and $50k monthly revenue increase

Assumption: users will refer more because by asking them, they will feel more responsible to act and know the benefits of referral to them as a customer

-?????????After this, we implement the hypothesis that has been designed

-?????????We measure the results

Based on the results, Paulina and her team noticed that directly asking users to refer had a direct impact on the number of users who eventually referred. By doing this, they hit the projected numbers.

-?????????You automate.

We have discovered this works; we want to automate through an algorithm that is executed after a user does the second transaction. As a growth marketing, what can be automated should never be done manually. This will help you and Paulina stay focused on being more creative.

In conclusion

The users sit at the center of what growth marketing is and what a growth marketer does. You must understand users and use that understanding to design your experiments and eventually get the desired outcomes.

My next article will talk about how to build User-Centric Marketing. You can subscribe here https://bit.ly/GMNewsletterSub ?