Interview: Why Sean Ellis sees growth hacking and marketing agility as bedfellows

The godfather of growth hacking talks about how the principle has evolved over the last seven years and what marketers can learn from this emphasis on growth


Examples of growth hacking

Growth hacking is about a process of rapid experimentation across marketing channels and product development to identify the most effective, efficient ways to grow a business. Growth hackers are most commonly engineers and product managers, specifically focused on building and engaging the user base of a business. They have deeper access into the product in order to drive sharing, engagement and retention.

There’s no right or wrong way to tackle growth hacking, however. Ellis points out one of the most successful companies is Uber, which maintains a separate growth team. On the other hand, Freelancer.com has all staff except finance reporting into the head of growth.

“Both of these approaches work, where it tends not to work is when the CEO is not closely involved or when the head of product is not supportive,” Ellis says. “However you set it up, product and growth should be part of the same organisation. Uber is the exception; in most cases, if the product owner and engineering are not on-board with growth initiatives, it’s hard to find success.”

According to Ellis, the most powerful levers for growth sit in things like improving customer engagement and retention, referral programs and monetisation experiments.

“If you get a doubling of conversion rate or retention, it’s just as powerful as putting twice as many people into your customer acquisition funnel, which is where traditional marketing organisations focused,” he says.

Growth hacking is all about focusing on the fundamentals of how growth works and finding levers in the business model, then experimentation towards high-leverage areas. “What growth teams are taking is a qualified approach and bringing it to the rest of the company, to try and increase experimentation and be more scientific,” Ellis says.

This doesn’t mean ignoring the customer or human element, however, and Ellis says the most effective companies are the ones that bring together data and experimentation with customer needs, motivations and human and emotional drivers for known and unknown behaviour.

“Understanding customer needs and principles of behaviour are very powerful. The data and experimentation is all about improving results, but it’s easier if you truly understand the human element,” he says.

Finding the north star

A vital ingredient helping align teams behind growth is what Ellis and growth hacking aficionados call a ‘north star metric’. This is a key metric that employees make decisions on, and that can be communicated organisation-wide.

“It’s really hard to figure out what that is for each business, but getting it right is a huge part of being successful with growth,” Ellis claims. “The most powerful thing Facebook did was boil everything down to a single metric: The daily active user. All decisions were then made based on building and sustaining that number.

“You compare that to people with thousands of different metrics, who can justify any action because one metric in the mix went in one direction, even as others fell down. A lot of times, companies will change this [north star] metric two or three times before they find the right one and embrace that.”

From a tools perspective, what’s also helping growth hacking initiatives is the shift from event-based tracking to more person-based tracking, Ellis says.

“When you combine that with a qualitative understanding of needs, that’s where it is really powerful,” he says. “With products like Kissmetrics, Mix Panel and Amplitude, you’re moving more towards user-based tracking analytics solutions whereas Google Analytics is fairly anonymous on who you’re tracking.”

Ellis’ second piece of advice for those looking to harness growth hacking is to articulate what your short-term objectives are, at least for the growth team.

“The more people understand the short-terms objectives that are qualified, and in what timeframe, the more you can keep people on the same page,” he says. “It’s about being clearly defined, communicating and continuing to update people as you make progress against the goals.”

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