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So businesses need to develop long-term creative, proven, and compelling strategies for building customer relationships. Such evidence-based planning and creating a loyal customer base is known as growth marketing.
Modern entrepreneurs and growth marketers alike should embrace growth marketing because;
This post covers the benefits of growth marketing, its core components, and examples of successful campaigns.
Let’s dive in!
Growth marketing is a data-driven approach for attracting, engaging, and retaining customers.
It’s a long-term strategic goal that optimizes your marketing funnel, unlike traditional marketing strategies that focus on specific parts of the funnel. The primary purpose of growth marketing efforts is to improve customer engagement and increase their lifetime value.
For instance, if a marketing team efficiently studies a strategy to use the data for customer acquisition and retention through brilliant tweaks, that’s a growth marketing team.
Referral programs and loyalty marketing are examples of growth marketing campaigns, just to name a few. Let me explain:
Referral programs incentivize customers to refer their friends. That’s how Paypal achieved almost 10% daily growth when starting. It works best when growth marketers build trust with customers.
Researchers who studied 10,000 accounts in a German Bank for three years found that customers obtained through referrals are more loyal and valuable than other customers.
Their research uncovered:
Loyalty marketing retains customers while attracting more through incentives like discounts and free gifts.
McKinsey’s survey about loyalty programs found that members of free loyalty programs are 30% likely to spend on the brand, while paid loyalty program members are 60% likely to spend on the same brand hence higher conversion rates.
For that reason, paid loyalty is expanding rapidly in modern growth marketing. And 56% of loyalty program owners are satisfied with implementing them in their businesses.
Successful growth marketers focus on setting goals, analyzing marketing data, testing different hypotheses, and implementing winning strategies.
On the other hand, digital marketing is creating and distributing marketing and promotional content on channels like websites, email, social media, mobile apps, and search engines. It includes other form of marketing including AI marketing and outreach marketing.
There are no rules for digital marketing – only tactics.
Growth marketing is constantly testing various channels to find the best way to retain and increase your customers’ lifetime value organically. On the other hand, growth hacking is when you find an underutilized strategy to solve your business problem at a lower cost per acquisition.
So, in growth marketing, you need to grow your audience by testing various channels, which is a slow process. In contrast, growth hacking is carrying out a specific tactic on a particular channel to grow the audience, which is a fast process.
Growth marketing is slow and steady, whereas growth hacking achieves quick results.
The foundation of your growth marketing strategy should have the following three core components:
The customer lifecycle is the path your customers walk through as they engage, learn, convert, and re-engage with your business.
There are three lifecycle stages that a growth marketing manager should focus on are:
Reactivation – you re-engage the customers to strengthen relationships and loyalty through campaigns like win-backs and loyalty marketing.
💭 CASE STUDY: RAIS published a case study on engaging customers with the right message in their lifecycle. One of their clients shared different emails depending on their customer’s lifecycle stage, which increased the conversion rate by 18% to 157%, better than the average conversion rate of 4.4%.
The client increased the conversion rate by;
Naturally, the client used an automation tool – RAIS – to send the emails at the right time.
Read further on the best email marketing software for customer engagement.
Growth marketers can apply A/B testing in several formats like social media ads, landing pages, chatbots and email marketing.
It entails applying either “A” or “B” testing to understand which content variation in graphics, design, or copies better engages and converts customers. Then, you can optimize your marketing campaigns around the version that works best.
💭 CASE STUDY: Kiva, a non-profit organization, did A/B testing on its website’s landing pages to find the best variant that encouraged people to sign up.
Their strategy looked like this:
They found out that their audience didn’t care much about graphics. Instead, they were hungry for information. The variant with answers to common questions increased conversion by 11.5% at over 95% confidence.
Cross-channel marketing is connecting your brand with customers through different communication channels and blending the messaging to give your audience a seamless progression as they move through different channels. For example, you can use push notifications, SMS, email, social media, mobile apps, and other channels in unison.
To build better campaigns, growth marketing teams must understand the customer’s communication preferences.
Ideally, they can use A/B test different channels to understand the customers’ preferences. Then build positive brand awareness through consistent messages on each channel.
Below are three examples of growth marketing strategies:
Hubspot has extensive marketing software to help businesses grow. They offer free tools for a growth marketer to capture website leads, nurture them via email, and convert them to paying customers.
Look, Hubspot offers the best free CRM software, but you must integrate it with other sales and marketing tools. So Hubspot provides the tools with paid plans. And as the companies grow, they’ll need to upgrade them. That’s their growth marketing strategy.
Hubspot’s growth strategy includes:
The same free tool strategy got Slack from zero to $4 billion in 4 years. It’s about getting users to try your product as early as possible
Etsy founders in their early twenties did freelance web development. At one time, they read comments and learned craft makers complained about lacking an online platform to sell their products. So they developed Etsy, and in 2005, they announced it to the public.
Etsy’s growth strategy involved experimentation and changing some elements on the site while gauging how users respond. They also empowered their users to be brand ambassadors.
If you use Etsy, check out these 4 tips to do SEO.
Robinhood is a commission-free stock trading platform. Their first selling point was cutting out commission fees. And since everyone wanted in on such a deal, they used the opportunity to attract almost 1 million users before launching the platform.
Their growth strategy involved:
Growth marketing is a long-term strategy for conversion rate optimization and increasing customer lifetime value and customer retention through incentives like a referral program or loyalty program.
It relies on customer data to develop the best approaches.
Best growth marketers A/B test different hypotheses and deliver messages according to the customer’s lifecycle stage. When using multiple channels to reach their target audience, growth marketers blend together the messaging to give their audience a seamless progression from one channel to another.
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