What Is Growth Marketing? Key Components And Strategies To Succeed
If you're like most marketing managers these days, you're probably operating on a short horizon. One survey of brand managers found that only 4% reported planning their campaigns on a time scale longer than six months. While that might work for fast-moving brands that just launched, you're not doing yourself any favors if you're looking toward sustained long-term growth. This is exactly where growth marketing comes in, and why some companies will go so far as to have entire growth marketing departments and teams in place.
What Is Growth Marketing?
Growth marketing is a data-driven approach that uses feedback and iterative processing to keep new customers long past the traditional campaign horizon of six months. The growth marketing model assumes the brand will still exist more than half a year from now, so it uses customer feedback and advanced data collection tools to make continuous improvements and keep onboarding new customers while holding onto the old.
Think of growth marketing as an extension of traditional marketing, just with a few extra steps tacked on at the end. It follows the usual marketing goals of brand awareness and acquisition, but then the growth marketing model adds retention, revenue, and referrals to build sustained growth over time.
Growth Marketing vs. Traditional Marketing
Growth marketing uses many of the same tools as traditional marketing, at least in its early stages. In the first few weeks or months of most marketing campaigns, the two can be hard to tell apart. Where they split is in their timescale and information sourcing.
Growth marketing tends to run on longer timescales than traditional campaigns. The growth marketing model tries to achieve long-term growth by extending the lifecycle of new customers and keeping them around longer. Traditional marketing has historically had a shorter horizon, typically wrapping up when the sale is made or the new customer joins for the first time.
Growth marketing is also different from traditional marketing in that it's explicitly a data-driven approach. That sets it apart from the older models for brand awareness, which were mostly guided by intuition or guesswork. Instead, growth marketing uses defined standards to gauge success, feeding data back into the cycle and making continuous improvements.
Growth Marketing vs. Traditional Marketing: A Case Study
This process creates an odd split in marketing techniques. Imagine you're in charge of the new marketing push for a popular brand of cat food. If you're using traditional marketing approaches, you might read potential customer profiles and trust your gut to craft an appealing brand message.
The traditional approach will probably earn some returns fairly quickly, say a 15% increase in sales in your target demographic of young professionals living in cities. Almost as soon as a traditional marketer hits those short-term brand awareness targets, the campaign wraps and planning starts for the next round.
How Is Growth Marketing Different?
Starting with a data-driven look at the numbers, a growth marketing team might choose a different demographic entirely, based strictly on the numbers, such as young adults living in the suburbs. Successful growth marketers will then use this demographic insight to craft an approach to new customers that has a track record of success with other brands, such as a heavy social media saturation or video content.
The real difference comes after the growth targets are hit. Instead of calling it a day and moving on to the next campaign, a growth marketing strategy follows these new customers along their journey with the brand and encourages feedback. Ideally, at every stage of the customer journey, brand management will solicit feedback to develop an always evolving picture of who uses the brand and why.
This feedback comes from a variety of marketing channels, and a good growth marketing team will use as many of them as it can. Typical options include:
- Email marketing
- Comments under the brand's YouTube videos and channel pages
- Direct contact with new users via phone or other cold contact
- Surveys attached to e-commerce pages
- User experience feedback gathered in traditional marketing channels
- Case studies and online reviews
- Market research with focus groups and test groups pulled from the customer base
Through it all, your goal should be to learn what you need to keep updating your brand messaging. The ultimate target isn't just a short hop in metrics but a sustained growth that doesn't trail off with time. If anything, brand awareness should keep going up as your satisfied new users refer friends and recruit new customers organically over the years.
Growth Marketing vs. Growth Hacking
This emphasis on sustained growth is what sets growth marketing apart from growth hacking, which is a kind of shortcut to faster expansion pioneered by Sean Ellis, the current VP of Growth at Bounce. To be sure, growth hacking has a place in your strategy. Mainly, the fast-and-loud saturation of growth hacking can do a great job of increasing brand awareness and putting your name on the trending topics list.
That's a good start to a new product launch or A/B testing startup marketing messages, but it doesn't last, and the benefits are typically short lived. For the most part, a quick growth hack gets high and spiky metrics for the initial burst. This is followed by a decline as the team runs out of ways to get attention and realizes it has few, if any, long-term plans.
Growth marketing might not have the runaway success of hacking right out of the gate, but its gains are sustained and possibly permanent. Take that cat food brand from before: The twentysomethings you win over today will be fortysomethings in 20 years. If they're still using your brand, or better yet, if their kids start using the "family" brand of cat food when they're on their own, you've potentially developed a lifelong relationship with groups of new customers who won't show up in the metrics for years.
Key Components of a Growth Marketing Strategy
Now that you have an idea of what growth marketing isn't, it's time to go over what it is and the key components. The details of your growth marketing efforts will depend on the brand you're promoting and the results you're chasing. There's a difference between marketing tactics aimed at lead generation and customer acquisition or between upselling and an effort to reduce churn rates.
Regardless of your goals, the methods you adopt will be guided by the growth marketing principles of good exposure at the top of the funnel, good conversion rates, low customer acquisition costs, and long-range customer retention. The decisions you make toward these goals will be guided by hard data and reliable feedback at every stage.
Within the growth marketing framework, you have a few reliable tools. You're probably already familiar with many of these, but you might be surprised at how the growth marketing framework puts them together and uses each methods' strengths.
A/B Testing
Do you like X, or is Y better? It's a simple question, which is the whole point of A/B testing. Instead of presenting customers with unlimited or open-ended branding questions they may struggle to answer, you can develop a series of simple comparisons to zero in on successful brand messages.
You might, for example, have a dozen ideas on how to talk about your brand of cat food. Instead of laying all 12 ideas in front of every target audience, just give each group two to choose from and ask—or analyze through performance metrics—which one they like better. If messages like "family," "safe," and "love" are consistently more popular among cat food customers than "cool," "modern," or "scientific," you can be pretty sure you're picking winning messages overall.
Customer Feedback
The relationship you have with your customers doesn't end when they buy a can of cat food. They will go home and feed it to their cat. After that, they may have valuable insights about your product that you need to know. Even a tangential idea, like changing the lid to a pull-tab design, might massively improve the entire customer experience.
You can get feedback in a lot of ways. Surveys, direct solicitation, and browsing online reviews of your product are tested approaches that give a partial picture. Something like real-time feedback may come through interactions on social media. Gather all the feedback you can get since it's crucial to the later stages when you're making informed tweaks to the brand and gradually improving its appeal.
Multichannel Marketing
TV, print, and maybe radio ads were about all you had 30 years ago. Today's digital marketing is multichannel and resembles a long-distance personal relationship more than a traditional marketing campaign. You just never know where your customers are going to find you, so your initial brand awareness campaign needs to go out over all of the most likely channels available to you, from social media to social selling to word-of-mouth.
You probably already knew about that, but with a growth marketing strategy, the brand engagement doesn't stop. Instead, you can keep the contact up across multiple platforms to chart the whole customer lifecycle. Say you came to the attention of a new customer when a YouTube influencer recommended your cat food to several million subscribers. Your next contact with this customer might be when they tweet about how much their cat likes the food to their 12 Twitter followers.
With good enough automation, your bots will catch that mention, which allows you to answer back with a message of gratitude that your hundreds of thousands of followers will see. Meanwhile, another customer is praising your brand on Google Reviews but complaining about opening the lid. This points you toward a multichannel announcement that your brand now features easy-off pull tabs.
Flexibility and Responsiveness
In the prior example, you were using multiple channels to achieve several growth marketing goals. First, you were increasing brand awareness and driving up sales. Second, your responsiveness on Twitter improved your brand's goodwill with a human touch in a public forum. You used a public review site to catch a complaint that might never have been visible to you otherwise, and you responded quickly with a full-court press to alert followers to your upgrade.
Flexibility and responsiveness are crucial to keeping customers onboard. A brand that communicates well and is perceived as wanting to do good for its customers will almost always move faster and retain more loyalty than a less responsive or slower brand. That translates into a higher customer lifetime value as current customers become receptive to upselling messages and new customers make a commitment for life.
Growth Marketing Campaign Types
When you have an idea what tools you need for your data-driven marketing campaign, it's time to work out what type of campaign you want to run. As a marketing manager knows, there are a lot of ways to get people excited about their brand, and some are better for certain projects than others.
Many of these campaigns are standard fare for marketing veterans, but growth marketing programs use them in some unusual ways. The key here, as always, is to adopt a data-driven marketing approach and then follow up with iterative improvements to keep customers loyal. Here are some of the top growth marketing approaches you can try.
Loyalty Programs
Loyalty is what growth marketing is all about, so loyalty programs take pride of place in any strategy you adopt. Whether you're gathering customer data to offer great discounts for long-time users or encouraging new users to join your savings club, the mere existence of a loyalty program encourages retention and lowers churn.
Harbor Freight does this very well. The Inside Track Club is a subscription-based loyalty program that uses steep discounts and exclusive coupons to encourage customer loyalty. Many HF customers get regular email marketing messages about sale events well in advance of the public, which helps them through the decision cycle of a big-ticket purchase on tools.
Referral Programs
Referral programs are a favorite campaign to skip the top part of the marketing funnel and directly recruit new customers. This plan usually offers cash-back or a discount of sorts for existing customers who refer a friend and win the brand a new customer.
New Product Development
It's not enough to have a good launch. Growth marketing is in it for the long haul, so you need to be continually making upgrades to your existing products—or developing entirely new ones—informed by your feedback and experience.
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