Growth marketing takes traditional marketing to another level, adding multiple layers like A/B testing, data-driven email campaigns, SEO optimization, value-adding blog posts, etc.
With thousands of businesses established every month in the United States, it has become increasingly difficult for businesses to stand out from the saturated market.
Developing creative strategies with a customer-first approach is what this kind of marketing seeks to achieve.
It goes beyond customer acquisition and seeks to retain customers through constant experimentation and a focus on changing customer motives and preferences.
In this article, we will take a deeper look into the concept of growth marketing.
What does Growth Marketing mean?
We could refer to growth marketing as traditional marketing 2.0.
In simpler terms, growth marketing involves experimenting with different tactical activities and focuses on maximizing all opportunities for growth throughout the marketing and sales funnel. This is where growth marketing differs from traditional marketing.
Traditional marketing employs different marketing strategies that build traffic at the top of the sales model. Think Google Ads and digital campaigns. But at best, these strategies stop at increasing brand awareness and acquiring users.
On the other hand, growth marketing not only focuses on the top of the funnel but consistently adds value throughout the funnel.
So with growth marketing, you not only attract customers but engage, retain, and turn them into loyal customers of your brand.
A growth agency will work to:
- find out areas to be tested and improved on.
- Develop and conduct experiments to optimize hypothesized areas.
- Analyze the results and carry out further experiments if needed.
Growth marketers are more data-driven and can experiment with different strategies and quickly concentrate on what works best.
Major components of a growth strategy
A growth strategy could be hinged on metrics like customer acquisition rates, conversion rates, customer lifetime value, and so on.
Let’s look at some tactics of growth marketing. These tactics are employed by growth marketers to attract, convert and retain customers.
A/B testing is a major tactic used by growth marketers to analyze the similarities and differences between two variations. This could be used for a particular marketing strategy or content type to determine which performs better and why. You can employ A/B tests for customized segments or audience groups to see which variation resonates best.
This type of marketing is a component of growth marketing that focuses on a channel plan to reach customers. This could be SMS marketing, email marketing, or push notifications amongst others. This strategic channel plan is based on your audience’s preferred communication channel. You can incorporate A/B testing to compare two or more communication channels to engage your audience.
The customer lifecycle is the journey customers take when they first come in contact with your brand until they become loyal customers.
The customer lifecycle consists of three main stages: activation, nurture, and reactivation.
At the activation stage, businesses seek to grab customer interest. The goal of the growth marketer is to create campaigns that build trust and credibility among customers.
The nurture stage focuses on engaging customers and strengthening relationships. Some of the tactics at this stage could include sending newsletters and recent updates to customers.
The reactivation stage is the final stage and it focuses on driving customer retention through campaigns like loyalty programs.
Growth Hacking vs Growth Marketing
Growth hacking and growth marketing are often used interchangeably. However, they are not the same. Growth hacking is more short-term while growth marketing focuses on the bigger picture and is more long-term.
Here are a few differences between both concepts:
- Growth hacking focuses on speedy growth majorly through customer acquisition. On the other hand, growth marketing focuses on long-term growth using full-funnel strategies
- Growth hacker uses a more hands-on approach which involves testing and fine-tuning while growth marketing involves automated and algorithmic processes with periodic adjustments.
- Growth hacking works with data to refine outcomes while growth marketing works with data to spot patterns and refine strategies.
Digital marketing vs Growth Marketing
Digital marketing and growth marketing is often taken to be synonymous, especially among business owners.
Basically, both types of marketing follow different methodologies. Digital marketing includes various marketing tactics implemented digitally. This includes tactics like email marketing, PPC, SEO, etc.
On the other hand, growth marketing uses digital techniques to upscale a business throughout the funnel.
Growth marketing is majorly data-driven and relies on certain metrics to track performance. With these metrics, you can easily examine your strategy and check if it aligns with your business objectives.
Here are a few growth metrics:
- Leads: This consists of the Marketing Qualified Leads (MQLs) and Sales Qualified Leads (SQLs) that your business is generating.
- Traffic: This could be Organic traffic (users that visit your website after performing a search on a major search engine), Paid traffic (users that come to your website through advertising mediums), or Referral traffic (traffic that doesn’t come from a major search engine. Eg social media traffic)
- Emails: Email metrics include open rate, reply rate, click-through rates, and conversion rate
- Average Revenue per user (ARPU): The average revenue per user shows the revenue-generating capacity of a company at the customer level.
- Monthly recurring revenue (MRR): This is the predicted revenue to be earned every month
- Customer lifetime value (CLV): The Customer Lifetime Value (CLV) calculates the expected revenue to be generated per customer over a period.
- Activation rate: This metric reveals the total number of new users that are taking a pre-decided action within a timeframe.
- Annual returning revenue: This refers to the total return on investment per year.
- Paid marketing: Paid marketing metrics include Return on Advertising Spend (ROAS), Customer Acquisition Cost (CAC), and Conversion Rate (CR).
- Revenue churn: This metric calculates revenue lost by a company over a period.
- Churn rate: This refers to the percentage of customers or subscribers that have either not renewed or have canceled their subscription within a certain period.
There are several tools and technologies to make growth marketing effective. A good growth marketer will focus on experimenting and optimizing different strategies and leveraging data to create a better customer experience and engagement.
Working with experts in the growth marketing field can change the face of your business.
At Khorrami Consulting, Shawn Khorrami alongside other experienced experts can help you grow and scale your business using effective growth strategies. You can contact us to speak with a professional.