Guide to Growth Hacking: Launch Your Startup on a Budget
After putting plenty of thought into it, you’ve finally landed on an idea you’d like to pursue as a startup. The next steps are figuring out how you can take your idea and grow it into a full-scale revenue-generating business. That’s where growth hacking comes into play.
In this guide to growth hacking, we’re going to explain the intricacies behind growth hacking and show you how you can leverage paid and unpaid channels to support healthy growth for your company.
We want to help you fully understand your business so you can implement the proper acquisition strategies that will help you increase your company’s growth 10x.
What Is Growth Hacking?
Growth hacking is an umbrella term that encompasses the strategies that help small businesses grow. The term is mostly geared towards early-stage startups that are looking for quick and speedy growth at a very low cost — yet its fundamentals can be applied to companies of all shapes and sizes.
The main objective behind growth hacking is to acquire new customers, retain your current customers, and maximize your company’s revenue. Through rapid testing, conversion rate optimization, and extensive experimentation with different acquisition channels, growth marketers are able to grow their customer base while simultaneously refining their product or service.
So what does a growth marketer look like? Growth marketers are somewhat of a jack-of-all-trades. They’re equipped with a marketer’s mindset, the technical skills to set up tests and marketing automation, and the quantitative know-how to optimize performance metrics.
But most importantly, the best growth marketers are rooted in data analytics and are always looking for ways to optimize their organization’s growth funnel by focusing on marketing initiatives that drive sustainable growth, rather than only a quick fix.
Optimizing Your Growth Funnel
Before we get into how you can drive growth for your company, we need to first lay out what your growth funnel looks like. According to Julian Shapiro of the growth marketing company Bell Curve, the growth funnel is “the journey a customer takes through your advertising and product experience.”
Each company’s growth funnel will look different, but you can always expect to have the same five stages — acquisition, conversion, engagement, revenue, and referral.
This is where you find all of your new potential customers. It’s imperative that your company has a steady stream of new leads coming in the door. Without new leads, your company is destined to stay stagnant and never realize its true growth potential.
There are two types of acquisition channels your company can pursue — paid and unpaid channels. Let’s first take a look at paid acquisition channels.
These are the channels that present a certain cost for each potential customer that comes in the door. Therefore, you’re paying for every person who clicks on an ad, every impression you receive, and every referred sale that comes your way.
Some examples of paid channels are online ads, affiliate marketing, and sponsorships — but we’ll touch more on these below, specifically online ads.
Paid channels are often very difficult for companies to master as there are several obstacles you must overcome, like:
- Maintaining healthy profit margins: Ads can be quite expensive. At the end of the day, you must be able to turn a profit.
- Having an addressable market size: You need to determine how many people want to buy your product and are actually capable of buying it.
- Having a high degree of product demand: There will be some people who may want your product, but how many people can’t go without it?
Shapiro also states that in order to be successful within your paid channels, you must cross all three of the following thresholds:
- Profit threshold: Each customer should bring in equal or more revenue than it costs to acquire them through each ad channel.
- Market size threshold: After targeting, you must have a large enough audience to avoid saturation.
- Product demand threshold: You should have a product or service that people are already buying or are willing to buy.
Once you’ve spent enough money in each channel to reach statistical significance, you should have a good idea of whether or not a paid channel will work.
If you’re not able to cross any of the thresholds above, then it may be time to focus your efforts on unpaid channels.
These are the channels that allow you to scale without spending more money. This doesn’t necessarily mean these channels are free — there will be upfront costs you’ll need to dish out. This just means that you’re not paying more as your performance scales.
For example, content marketing is an effective unpaid channel that many startups use to drive acquisition. Companies will pay writers to create blog posts, but the resulting organic traffic is essentially free after that. As more visitors arrive, you won’t pay additional costs as performance scales.
Using Paid and Unpaid Channels in Tandem
The trick is getting these two channels to work together in harmony.
According to Shapiro, “Paid channels let you scale big and fast while (unpaid) customer referrals reduce the average cost of customer acquisition.”
You shouldn’t put all of your eggs in one basket, especially paid acquisition. Success and profitability within paid channels is difficult to sustain, so you should always be thinking of ways to supplement acquisition with unpaid channels.
Unpaid channels will drive long-term success, while paid channels will help you get off the ground and inject life into your growth.
Much of your growth efforts will rely on the success of key conversion moments throughout the funnel. These events occur when someone converts from one stage to the next.
For example, if a potential customer arrives on your site, you may be trying to convert them into a registered user. From there, your next conversion would likely be trying to turn the registered user into a paying customer.
Conversion optimization throughout the different stages of your funnel will be the lifeblood of your growth — so you should know how to do it, and do it well.
This is where testing comes into play. In this guide, we’ll go in-depth on A/B testing and how you can implement rapid testing processes with things like landing pages.
Many products and services can get people in the door, but then fail to engage their user base. Engaging your users is crucial to converting them into paying customers.
For example, when we think about Slack — the team communication and collaboration tool — small teams are able to sign up for the free version.
When you sign up and begin to use the product, Slack makes it a point to onboard its users by showing them different features within the program as you use the tool. You may also receive emails that highlight different ways you can use Slack.
The goal is that Slack wants you to understand how to use its tool, realize its true value, and then convert your team into paying for premium versions that allow you to do much more.
Once you’ve successfully acquired, converted, and engaged your customers, it’s time to focus on ways to optimize your revenue streams.
As with the other stages of the funnel, testing will be critical to increasing your average revenue per customer. These tests could consist of cross-selling products, trying to cut costs, testing your pricing strategy, and improving your customer retention.
Improving customer retention is absolutely necessary because it’s much cheaper to retain a customer than it is to acquire one. By creating an effective onboarding experience, providing excellent customer support, and ensuring customers realize the full potential of your product, they’re more likely to stick around.
Having loyal customers who use your product on a regular basis is one of the best marketing advantages you can have. Loyal customers continue to pay for your product or service and open doors to new customers through word of mouth, referrals, and social proof.
On top of that, once you lose a customer, it costs significantly more to win them back — so much that you might as well cut your losses and move on.
No matter how many customers you have coming in the door, if you’re losing them after a short period of time, what’s the point? Increasing customer retention by a few percentage points will greatly increase overall revenue. And plus, customers are eager to support businesses that help them with their problems.
From the very start, you should have a product or service that people will love and want to sell for you.
Having a healthy dose of word-of-mouth and referrals will help your company naturally grow. It’s incredibly cost effective and offers a sense of virality that will drive long-term growth.
It’s important to note that there are a few different ways your startup can go viral.
One way is if your product has inherent virality. For example, in order for you to use Slack, you need others to message and collaborate with. Therefore you’ll naturally invite others to join.
The other way is through artificial virality. This is like when Uber says they’ll give you $10 worth of ride credits if you refer one of your friends.
Amazon has also done a great job of growing rapidly by using their Amazon Associates referral program. They pay other people to help them grow, and it works very well.
The last way is through good old-fashioned word of mouth. This is when you’ve impressed a customer so much, they feel the need to go shout your name from the rooftops.
Understanding Your Business
Before getting into the tactical side of growing your startup, you first need to fully understand your business.
It’s important to realize that what works for one business may not work for another. At the same time, you can also take a look around at your competitors within your industry and examine their successes and failures.
If you can see what has worked for others, you can take note and apply some of those strategies to your business.
You should also have a thorough understanding of the type of business you’re launching. The first step is figuring out if you’re selling to other businesses (B2B) or selling directly to consumers (B2C).
You should then be able to answer the following questions before getting into the weeds:
- For B2C companies: Do you sell physical goods on an e-commerce site, have a SaaS startup, have a mobile app, or own a brick-and-mortar store?
- For B2B companies: How valuable are your customers to you? Do you have a high or low average revenue per customer? Is your idea very niche or do you have a broad product category?
Once you have your ducks in a row, you should be able to clearly articulate what success looks like for your company. It’s imperative that you set goals and have a measuring stick for success.
Maybe you’re trying to double your user base over the course of one year. Or maybe you’re shooting for increasing your revenue by 30% in your first year of business.
A clear definition of what growth means for your company will help you to continuously improve and refine your strategies.
Now, you’re ready to get into the tactical side of growing your company.
Almost every startup that has successfully scaled has one thing in common — they were laser-focused on one or a few growth channels that helped shoot them to the moon.
One playbook that you can follow is the Bullseye Framework, pioneered by co-authors Gabriel Weinberg and Justin Mares in their book “Traction: How Any Startup Can Achieve Explosive Customer Growth.”
The Bullseye Framework is a three-step process that helps you determine which traction channels will create the most growth for your company at its current stage.
Before going through the entire process, it may help to watch the short video below explaining how the Bullseye Framework functions.
Now, let’s walk through each ring, starting with the outer ring first.
The first step is brainstorming ideas for every single acquisition channel. It’s imperative that you explore every single channel because you never know when you will uncover an opportunity that you haven’t thought of before.
More importantly, your customers may not be using a certain traction channel that you’ve found to be effective. This could quickly become your competitive advantage.
You should think about how you could use each channel and brainstorm different scenarios and tactics that could yield positive results. Don’t worry too much about the specifics of each channel, as we’ll cover them in further detail below.
To start evaluating customer acquisition channels, you should think about the following questions:
- Cost: How much does it cost to acquire a customer through each channel?
- Reach: How many customers can you reach through each channel?
- Targeting: Are the customers you’re reaching the right customers?
From there, you should narrow down your choices to three channels that you see as being promising growth solutions. This shouldn’t be too hard since some channels will stand out as sure winners.
If you’re not able to narrow it down to three channels, it might be time to go back to the drawing board and rethink the feasibility of your idea.
Now that you’ve narrowed it down to three channels, it’s time to start testing.
Your goal will be to figure out the one channel you should pursue rather than spreading yourself too thin across many channels.
At this point, you’ll start running tests on all three channels simultaneously to see which one has the most promise to deliver growth at the current time.
For example, you may look at your acquisition channels and narrow them down to three promising channels — targeting blogs, SEM ads, and online ads. From there you’ll spend a few weeks testing and trying to figure out which one will deliver the most growth for you.
For targeting blogs, you can reach out to several online publications that have the potential to bring a substantial amount of visitors to your site. If you can get them to write an article about your company, track the amount of visitors and successful conversions you obtain.
In regards to SEM ads and online ads, this will require running a handful of ads on each channel. Again, you’ll track your conversion rates for each channel to see which one performed best.
Based on the results of your testing, you’ll then choose the highest performing channel to focus on — for the time being — keeping in mind cost, reach, and targeting that we laid out above.
Remember, these tests shouldn’t require an immense amount of time, effort, and money. At this point in the process, you’re just trying to uncover the one clear winner you will use full-time.
Once you figure out the one growth channel you should pursue, you’ll run as many tests as humanly possible and optimize your conversions.
The benefit of focusing on one channel at a time is that you’re able to find conversion opportunities deep within each channel, find sticking points where customers are getting hung up, and master each channel by being laser focused.
By focusing on one channel specifically, you’ll wring out any growth available through the channel before moving onto a different channel.
You should note that growth happens in spurts. What worked at one stage of your company’s growth may not work at the other. If you want to level up, you’ll need to make transitions along the way.
If there’s one thing you should take away, it’s that being extremely focused on one growth channel at a time will yield the greatest results for you in the long run.
Peter Thiel, PayPal founder and an early Facebook investor, put it this way: “It is very likely that one channel is optimal. Most businesses actually get zero distribution channels to work. Poor distribution — not product — is the number one cause of failure. If you can get even a single distribution channel to work, you have a great business. If you try for several but don’t nail one, you’re finished. So it’s worth thinking really hard about finding the single best distribution channel.”
We’ll now introduce every single traction channel that you can experiment with.
Understanding Each Traction Channel
Knowing where to start can be intimidating to many new founders. There’s so much noise out there that you have to deal with, including subject matter experts who all claim their marketing channel is the best.
The truth is, the best acquisition channel is the one that can help you gain traction at this moment in time — not the channel that one biased blogger keeps pounding in your head.
It may be tempting to follow the herd and use the same channels as your competitors, but make sure you explore all of your options and stay disciplined once you land on your core acquisition channel.
There are many different strategies you can pursue to gain traction, all of which fall into the following 19 categories according to the “Traction” methodology.
- Targeting Blogs: Contacting blogs to write articles about your company
- Publicity: Getting exposure through traditional media channels like newspapers, magazines, and TV interviews
- Unconventional PR: Doing something out of the ordinary, like a publicity stunt, to gain media attention and customer engagement
- SEM: Advertising on Google search results by targeting specific keywords
- Online Ads: Creating paid social and display ads across various social platforms and ad networks
- Offline Ads: Using traditional ads like TV and radio commercials, billboards, newspapers, and magazine ads
- SEO: Optimizing your site so that you rank high on Google search results
- Content Marketing: Posting online blog content that can be used to rank high on Google and bring organic traffic to your site
- Email Marketing: Maintaining relationships and converting prospects into customers through email communication
- Engineering as Marketing: Building useful digital tools people can use so you can collect leads
- Viral Marketing: Encouraging customers to refer additional users through some form of incentive
- Business Development: Creating relationships with other businesses that are mutually beneficial
- Sales: Having the appropriate conversations with leads that convert to revenue
- Affiliate Programs: Allowing others to sell your service or product in exchange for an affiliate commission
- Existing Platforms: Using platforms like Facebook, Twitter, or the iOS App Store to promote your products and convert leads
- Trade Shows: Promoting your business at industry-specific gatherings
- Offline Events: Promoting at smaller events like industry-specific meetups or conferences
- Community Building: Creating a forum or contributing to an online community where people can interact with one another
Remember to keep an open mind when brainstorming ideas. You should be thinking about ways your competitors are using these channels and ways you can differentiate yourself and find a gap in the market.
A company who continues to innovate and stay ahead of its competition is HubSpot — a marketing, sales, and service software. One of HubSpot’s strategies is using engineering as marketing.
Over time, they have developed free tools like an invoice template generator, a marketing plan template generator, and even a blog ideas generator. All of these tools are lead magnets and they perform spectacularly well in regards to SEO while collecting qualified leads.
Also, you’re trying to find the one channel that will do the most good for you at this stage of your company’s growth. Once you’ve figured out which channel that is, you should ignore the other channels.
You’ll get the biggest bang for your buck by pursuing one channel at a time. The exception is that you can use other acquisition channels, but only the ones that support the main channel you’re focusing on.
For example, if you’re pursuing content marketing, you may be running online ads or implementing technical SEO tactics to drive traffic to your site.
Now that you have your core channel figured out, it’s time to start setting up experiments so you can optimize and improve your conversion rates.
Setting Up Experiments
Experimentation and conversion optimization will be your best friends as you take your startup from ground zero to 10x growth. Much of this experimentation will be through the use of A/B testing.
What Is A/B testing?
A/B testing is a randomized experiment with two variants, A and B. By randomly splitting two groups of people, you can test changes and measure the performance of each group. If you find that a change you’ve made is statistically significant, then you can adjust your strategy and move onto the next test.
Weinberg says, “The purpose of an A/B test is to measure the effectiveness of a change in one or more variables — a button color, an ad image, or a different message on one of your web pages.”
This means that A/B testing isn’t limited to just one channel. You can run tests on nearly anything within your marketing arsenal. Custom landing pages, the messaging of emails to your customers, or the location of sign-up forms on your website are just a few ways you can implement tests.
The key is running as many tests as you can and as fast as possible. The faster you’re able to run experiments, the faster you’ll realize success and move the needle for your company.
If you need more insight into A/B testing techniques, you can check out this helpful testing guide that walks you through the entire process. You can use any of the following tools help split your audience and start running tests:
The best way to go about this is by setting up a repeatable and structured growth experimentation process.
Structured Growth Experimentation
Growth experiments should be well thought-out, follow a repeatable process, and be designed with the intention to increase revenue. To give this a little organization, we’ll walk through a few considerations that should be made when designing a growth experiment.
Test Revenue-Generating Changes
This must be considered at the very beginning of the experimentation process. To save time and energy, it’s critical to make sure every variant you introduce can be directly attributed to an uptick in revenue. That’s the bottom line.
There’s no point in testing something that doesn’t lead to more sales. If you created a non-revenue generating shiny button that people love to click, you’ve only succeeded at distracting them.
Tests that move the needle for the company and focus on increasing revenue should be prioritized. Other tests can fall to the back of the line and only experimented with after you’ve run out of things to test, however, you should always have a plethora of ideas to test.
Let’s take a look at how you can maintain a healthy supply of testing ideas.
Source Testing Ideas
It’s important to have a stockpile of testing ideas at your disposal. These testing ideas can be generated in several ways. For example, you can source testing ideas through the following ways:
- Look at competitor websites, advertisements, and strategies
- Implement an internal idea generation process for your team
- Observe onsite behavior using a visitor recording tool
- Use an analytics tool like Google Analytics to poke around for conversion opportunities
Once there are plenty of testing ideas to choose from, it’s time to prioritize which experiments to run first.
So where do you start? Well, as we already mentioned, you should prioritize testing ideas that have the potential to increase your overall revenue. This is the most important. Once you have that in mind, categorize your testing ideas into macro and micro opportunities.
Macro experiment opportunities should be prioritized because they have a better chance of increasing revenue more drastically. These are your more intensive changes that require a little bit more planning and execution. Micro changes — like the color of buttons, CTAs, or imagery — are useful, however, they don’t affect revenue nearly as much.
Test the Top of Your Funnel First
Focusing on the top of the funnel allows for a large enough sample size that you can acquire quickly. The further you go down the funnel, the smaller the sample size will be, and the longer it will take to reach statistical significance.
Time is of the essence when you’re running tests on a regular basis. If you’re performing one test at a time — which we’d recommend — you want to get an appropriate sample size as fast as possible so you can move onto the next test. Also, it may take a few attempts before finding an experiment that’s actually significant enough to increase revenue.
Important Aspects of Experiments
In summary, the most important aspects of an experiment are starting with testing opportunities that drive revenue, running tests long enough to reach statistical significance, and making sure you document the results of every single test.
Documenting every experiment provides a history for you and others to look back on.
First, it provides insight for yourself and others on the team as to why things are the way they are. If there’s ever a question, you can look back and remember why you made the change in the first place.
Second, it provides a source of inspiration for new testing ideas. By looking at the results of previous tests, you can drum up new ideas to test.
Experiment Aspects You Can Ignore
One aspect of an experiment that can be ignored is including your current customers or repeat visitors from your sample set. If you only focus on new users, you can ensure that your test results are crystal clear.
You can also ignore tests that don’t drive revenue or take up a ton of resources to implement. If an idea takes a great deal of engineering and resources, it might not be a logical test to run at this point in time.
Lastly, tests that produce negligible results shouldn’t be taken as gospel. You should be wary of implementing changes based on the results of a “meh” test.
With a well thought-out game plan and a structured experimentation process in place, you can move forward at lightning speed.
Now we’d like to give you a little taste of two popular traction channels that will likely come in handy.
Since we laid out 19 different channels above, for the sake of brevity, we’ll focus on two channels in this guide — content marketing and online ads.
Unpaid Channel: Content Marketing
Having a steady flow of great content is critical for driving free organic traffic. By creating a content plan and successfully executing on that plan, your company can set itself up for long-term growth for years to come.
But before you start randomly throwing blog posts onto your site, you should understand that there’s a science behind content marketing that will set you up for success.
It’s more than just writing articles based on what’s on your mind or pumping out a ton of hastily written 500-word articles.
To set yourself up for success, you should determine if content marketing is right for you, create a content plan, execute on that plan, and promote and optimize your content to get more eyes on each article.
Is Content Marketing Right for You?
The first step is figuring out if content marketing is the right choice for your business. There are several questions you should ask yourself that should be tell-tale signs if you’re cut out for pursuing this channel.
First up, do you have the time and resources to dedicate to content marketing? Content marketing isn’t some light endeavor that you can go into haphazardly. You’re either all in or not in at all.
It will require the investment of your time if you’re writing articles yourself, money to pay writers to help you, or a contracted agency to handle the entire process.
It also takes time to see any results from your efforts. Most high-quality articles take at least six months to begin ranking on page one of Google — in some cases even a year.
So if you’re looking for a quick hit of traffic and don’t have the patience, then move on.
Once you’ve decided that it’s the right channel for you, it’s time to create a content plan that will guide you along the way.
Creating a Content Plan
Your content marketing efforts will only be as good as the plan that guides it. If you want it to work for your startup, then you should do your research, find topics that will generate traffic, and follow a strict content calendar.
The first step is discovering topics that you can write about and doing keyword research. With a tool like Ahrefs and Clearscope you can scope out your competition and find out which keywords they’re ranking for and what type of articles they’re writing.
Next, you can develop umbrella topics to guide which types of articles you’ll write. For example, if your company sells camping gear, then you can create article themes like the best places to go camping, different types of camping supplies, or tips for the perfect camping trip.
After that, you can create a content calendar that you should strictly follow. To see results, you should plan to write at least three articles per week with a word count of at least 1,500.
Your calendar should also include deadlines that must be met no matter the case. If you get lazy with your content production and let deadlines slip by, things will begin to snowball and you won’t see the same results. Consistency is key, so make sure you stay disciplined.
Executing Your Content Plan
Next up is executing on your content plan. This means following all the rules and guidelines you set and creating articles that are relevant and useful.
As you set out on this adventure, you should have the intention of writing the best articles on the web.
By writing useful and relevant content, Google will naturally elevate your rankings above your competitors. Having great articles that help people solve their problems is the easiest way to rank.
Making your articles seem natural without seeming as though you’re stuffing keywords will also help set yourself apart. You should be writing your articles with certain keywords in mind, but you should never make it feel like you’re throwing words in there just to rank.
Having reliable sources to back up your findings will also help show that you’re a trusted source of information to your readers.
The same goes for internal linking. The more you link to other helpful content on your site, the longer users will stay and consume your content.
When a batch of articles are polished and ready to go, you can then focus on promoting and optimizing your content.
Promoting and Optimizing Your Content
Content promotion will help get eyes on what you’re producing. The same goes for search engine optimization tactics like targeting featured snippets, optimizing for voice search, and link building.
A few channels that lend themselves well to content promotion are Twitter, Pinterest, and Reddit.
You can also employ email list building strategies on your site to collect emails, then send out weekly updates with relevant content to your engaged following.
Lastly, search engine optimization should always be top of mind when creating and promoting your articles.
SEO warrants an article of its own, but a few ways to stand out are by targeting featured snippets, optimizing for voice search, and having a healthy supply of backlinks to your site.
Featured snippets are the boxed answers that you see on Google search results when you’re searching for a certain topic.
If we type in “What are featured snippets?” in Google, we get the following results at the top of the page.
“The Featured Snippets are a format which is supposed to provide users with a concise, direct answer to their questions – right there on the search results page, without the users having to click through to a specific result.”
Featured snippets give your site authority and are more likely to drive traffic to your site. The nice part is that you can format your articles to target these opportunities.
Under each of your headings, you should have a short paragraph that sums up the entire section and answers the main question readers are looking for.
These paragraphs should be between 40 to 60 words and contain the meat of what the rest of the section is talking about.
Voice search is expected to grow year after year as more people bring voice-enabled devices into their daily lives. According to a study by PwC, 65% of people between the ages of 25 and 49 speak into their voice-enabled device at least once per day.
This means that optimizing your content to capture some of this audience is something to keep in mind.
By writing conversational posts, you have a better shot at targeting voice search results. Also, if you write your posts to answer visitors’ questions, you can capitalize on these voice queries.
Both of these are worded to clearly answer a reader’s question. There’s also a good chance that questions like these will be asked through a voice-enabled mobile device.
You should also make sure that your business listing is up to date. You wouldn’t want someone using a voice device to ask for your company’s phone number or navigate to your address if you’ve provided them with outdated information.
Link building is another art form that deserves its own deep-dive, so for now, we’ll tell you the essentials. There are plenty of ways to build links to your site and everyone swears by their own method.
One way is by employing the Skyscraper Technique — which consists of finding competitive content that ranks well, writing better content than these articles, and then reaching out to sites with the proposition of having them link to your much better article.
The pioneer of this methodology, Brian Dean, put it this way:
“Have you ever walked by a really tall building and said to yourself: ‘Wow, that’s amazing! I wonder how big the 8th tallest building in the world is.’ Of course not. It’s human nature to be attracted to the best. And what you’re doing here is finding the tallest ‘skyscraper’ in your space…and slapping 20 stories to the top of it. All of a sudden YOU have the content that everyone wants to talk about (and link to).”
By creating better content that’s relevant and useful, third-party sites will be more inclined to link back to you.
You can also reach out to reporters with your articles to give them something to write about. These are often referred to as HARO articles — or Help a Reporter Out. Reporters are always looking for engaging content to cover, so if you can provide something valuable to them, it’s a win-win for both parties.
Lastly, you can feature high-quality guest posts on your site and also have your team guest post on other sites. This type of link building is reciprocal and will also benefit both parties.
Paid Channel: Online Ads
Entering the world of paid ads, there are many variables to consider and channels to choose from. Not every online advertising channel is made the same, and there are definitely some that perform much better than the rest.
Each channel will present a set of strengths and weaknesses that you’ll need to evaluate. Some factors that you’ll need to consider include the following:
- How much does each channel cost?
- What does each channel’s audience look like?
- How many of your customers are on that channel?
- Does the platform fit your product or service?
According to Julian Shapiro, your business should start experimenting with Google AdWords, Facebook ads, and Instagram ads. Since Facebook and Instagram now run on the same ad platform, we can lump them into the same group.
Shapiro says, “Your ad channel testing should typically begin with Google AdWords and Facebook. Their massive audiences and precise targeting make them viable for many products. However, how you target audiences on these two platforms is very different. But complementary. Every business should pursue both to capture their full audience.”
First, let’s take a look at Google’s ad network.
With Google AdWords, your targeting capabilities are more focused on the behaviors of consumers. Since these are the ads that are featured on Google’s search results pages, you’re able to serve ads to consumers who are actively searching for keywords related to your business.
This means that there’s a good chance they’re in a purchase mindset.
For example, if someone types in “Buy camping gear online,” this would be the perfect opportunity to target these consumers based on their search habits.
However, you may miss out on a subset of potential customers who aren’t actively searching the web but are still in the market to buy from you. That’s where Facebook and Instagram come into play.
Facebook and Instagram
When using Facebook and Instagram to advertise, you have the advantage of creating a well-rounded profile of customers.
Everything from profile information, liked pages, interests, friends, shared articles, and web history can be used to paint a picture of exactly what bucket each person falls into.
Marketers can then use this information to serve ads they think will perform well based on profiles they’ve created.
Ideally, successful startups will use a combination of the behavioral and profile-based targeting capabilities of both Google and Facebook ads.
Additional Ad Channels
There are also plenty of other ad channels that you can experiment with, however, it will take some time to figure out what works for your company. Many of these ad channels have either poor engagement or crummy post-click purchase rates, so proceed with caution.
Here are a few more ad channels you can also test:
- Display ads
The trick is to find which channel works for your business and throw your money there. You shouldn’t waste time and money on channels that aren’t working, so don’t be afraid to jump ship.
Stay Focused and Start Growing
To summarize, in order to lay the foundation for healthy growth for your startup, you need to fully understand your business and your growth funnel.
You also need to be extremely disciplined and follow a marketing plan, like the Bullseye Framework that we explained above.
You should always go with what’s working and wring out any growth you can before moving onto the next channel.
It’s also imperative that you’re always testing and optimizing your conversions. By running ongoing experiments, you can listen to the data and make tweaks to improve every single day.
Lastly, you should stay somewhat diversified and not put all of your eggs in one basket. If you’re only focusing on paid channels, you may want to think about pursuing unpaid strategies, like content marketing, to support long-term organic growth.
We’d like to end with one more insightful takeaway on growth hacking from Shapiro.
“A common mistake people make coming into growth is thinking that growth hacks are a meaningful thing. The ultimate growth hack is having the self-discipline to pursue growth fundamentals properly and completely. So, things like properly A/B testing, identifying your most enticing value propositions and articulating them clearly and concisely, bringing in deep channel expertise for Facebook, Instagram, Google Search, and a couple of other channels. These are the tenants of making digital growth work. Not one-off hacks.”
Stay focused, stay disciplined, and listen to your data. If you do all of the above, you’re on the right track to achieve explosive growth for your startup.