While Andrew Chen recently popularized the term 'growth hacker', Sean Ellis (along with Hiten Shah and Patrick Vlaskovits) came up with the term a few years ago. Sean shared explained his process for developing a sustainable growth program, based on his experiences a Dropbox, Eventbrite, and Lookout, at the growth hacker conference this past Friday.
Behind the term 'growth hacking'
The concept for growth hacking grew out of the fact that most startups fail, and needing to not fail. When you think about games, the market is filled with large companies with lots of money to throw into marketing. Sean summed this need up well, with:
When you're competing against Sony, you can't go dollar for dollar
Growth hacking grew out of this, and thinking about how to leverage what startups have - engineering power and smarts - to work on growth, what was typically perceived of as being a purely marketing function. This means leveraging existing user bases, APIs, networks, etc., and creating spreadable experiences in different environments to enable people to easily onramp into your product.
1. Always start with product value
Sean stressed the importance of having a great product, as many (if not all) other speakers at the conference did:
At the core of any successful, sustainable growth program is a great product.
You really need to have a valuable product, and some indication of PM-Fit before you start to work on growth. Sean looks at growth as building a value delivery machine - growth simply means that more and more value is being delivered to more and more users.
2. A Must-Have Experience
Sean focused on the importance of a Must-Have Experience (MHX) - you must have a hook that clearly identifies what this is. Only then can you optimize flows to deliver that MHX, calibrate your hook and promise messaging, and deliver the core value of your product. Early growth then becomes about optimizing your funnel to deliver the MHX as quickly as possible - and as often as possible.
3. Uncovering your MHX
To get a clear understanding of what your MHX is, Sean suggested reaching out to your Must Have Users (MHUs)… but what is a MHU? Sean likes using a pop-up or other survey tool to ask people 'How disappointed would you be if [your product] wasn't available anymore?' on a scale ranging from 'not at all disappointed' to 'extremely disappointed' to identify your MHUs (they'll answer very or extremely disappointed).
The next step is to learn more from these MHUs, and to really understand them and what they feel is the core value of your product. You can ask these identified MHUs 'What is the primary benefit you receive from [your product]' (as an open-ended question to start, then after getting ~30 responses, you should be able to narrow it down to 3 multiple choice answers). This information will allow you to throw away your assumptions around what is the core value of your product, and get a firm understanding of what your true MHX is.
4. Getting people to your MHX
Once you understand your MHX, you can then maximize the percentage of people that reach this point. This means identifying points of friction and reducing that friction (Sean suggested watching people use your product, and then A/B testing based on insights gained), focus on what a real conversion looks like, building channels to increase user habits/increase revenues/drive sales/etc., and understand intent by A/B testing your messaging and hooks. You need to obsessively optimize everything that is part of this newly formed growth engine.
Sean ended by noting that there's a lot of creativity needed to create a successful growth program. You need to engage with your users, and take those insights to come up with new, breakthrough ideas. When you speak with engaged users, you should be able to come up with and test lots of ideas - and then double down on what's working. Oftentimes, running lots of tests won't directly lead to obvious solutions to growth, but you'll be able to triangulate across this information to come up with an idea that can work together to build a successful, sustainable growth program.