Ryan Holiday elucidated the Growth Hacking in his 2015 bestseller Growth Hacker Marketing:
While their marketing brethren chase vague notions like “branding” and ‘mind share’, growth hackers relentlessly pursue users and growth… whereas marketing was once brand-based, with growth hacking it becomes metric- and ROI-driven.
In theory, growth hacking sounds scrappy — using low-cost strategies to achieve growth and implement experiments and processes aimed at building a company’s customer base.
In practice, growth hacking has become money pit, though invisible, for a number of reasons.
For one, as columnist Samuel Scott noted in an opinion piece for The Drum:
Not everything that is important in marketing can be measured and not everything that can be measured is important. Moreover, many digital metrics are incomplete or completely inaccurate. Not every activity in marketing can or should aim to receive an immediate, trackable response.
Growth hackers can be too seduced by measurable data porn and gone astray
Case: Tila Tequila, A Growth Hacker Gone Astray
The internet starlet Tila Tequila was an internet sensation around the year 2006. She was a self-made, self-taught growth-hacker before any growth-hacker books were released. Tila joined MySpacewith the profile name Tila Tequila in 2003. She uploaded countless glamour shots of herself, from modeling for a variety of import car magazines (content marketing), recorded and broadcasted herself singing, and interacted with fans (engagement marketing). At the time, the structure of MySpace helped her gain fans – since Tila was one of the most popular and oldest members of the network, she often automatically appeared in random people’s “Top Friends” during the early days of the site (she leveraged and exploited the new tool before anyone else knows the power of the tool).
She counted over 1.5 million friends on MySpace and her blend of over-sharing, sexy pictures, and impressive commitment by way of fan engagement made her a potent social media force and catapulted her into the echelon of real celebrity. But her forays into musicand acting petered out. She didn’t have a clear vision or purpose of her brand identity. In order to remain relevant and keep the public attention, she pivoted a few times. Her public appearances ranged from being pelted with balloons filled with urine, feces, and rocks during “The Gathering of the Juggalos” in 2010, to Tila railing about the Illuminati stating how she has received direct messages from God and Reptilians. She became engrossed in the sleazy side of show business. In fact, her current level of fame is most similar to the amount of attention she got back when MySpace was just starting out. The only difference is that Tila’s fan base shifted from horny teens and MTV devotees to hardcore wackos.
It is a sad story of fervent commitment to your fan base without a clear idea of what kind of fan you want to attract. Not all eyeballs are equal in real life. However, in social media you can’t tell the difference. All eyeballs count equally. Data-driven decision making can also lead you astray. Without a clear vision and business purpose, you are left in the mercy of the fickle rants and raves from your fans.
This mindset can lead to startups going astray, too. If the early adopters are not aligned with your targeted future early majority, and if they are without motivation and know-how to evangelize for the product, then the feedback they provide will not only be irrelevant, but also misleading.
For two, the relentless pursuit of everything trackable and testable blindsides the other less-testable invocation and creativity in play. The search for the Holy Grail, something that multiplies growth by 10, 20, or 40x simply costs the team to be tunnel vision that lost the sight for intangible brand north star and wasting valuable time.
Case: Why Friendster Failed and Facebook Succeeded
Friendster was once the hottest thing in social networking. Google wanted to buy it for $30 million in 2003. It was burdened by technical glitches and a more nimble competitor in Facebook. It was pretty much dead in the U.S. by 2006. That said, it trudged along for a few more years, helped by a relatively strong following in southeast Asia. Many Silicon Valley analysts and reporters gave Friendster an autopsy dissecting the data and products. Nonetheless, those data driven readings could never explain the gaps in the data that often attribute to the intangibles, the strength of the brand.
From the start, Friendster didn’t understand what social media actually is and didn’t have a clear social purpose for its brand. Very few did at the time. But in hindsight, it’s apparent that Friendster enjoyed its early growth and impressive traction. However, the early users’ enthusiasm for decorating their profiles and showing off their pictures must have led them to think that this was all that is needed to sustain a business. They could not articulate what their vision was for their users.
In its early days, Facebook was focused on profiles, too. Then Mark Zuckerberg rightly recognized that Facebook’s purpose was about “connecting people”. On that premise, it led Facebook to think about what is important for connecting people. Does showing off your picture really connect people? Or is this the case only if these pictures are relevant to their friends. Hence, they put emphasis on news feed updates, the like button, comments, and tagging friends in photos. While the site was still attracting new people, Zuckerberg revamped it up to elevate the news feed’s importance, pushing apps and boxes to the rear and putting friends’ updates, shares, and discussions front and center. Naturally, users freaked; but Zuckerberg stuck with his gut and a funny thing happened — people got used to the new design. They started to miss their apps less and less. They started commenting and clicking “likes” on everything. And (most) stopped caring about how many friends they had. Along the way, the Facebook user base consistently grew.
Startups may be distracted and waste both resources and time chasing trends; trends that were gauged from the early users without knowing that these trends can be very fickle and users can get bored after the initial novelty. You need to have a purpose for your business so that you can ultimately innovate and create value for users.
For three, growth hackers love to say they’re conducting “experiments” because it sounds scientific. Real scientific experiments are never scrappy. Quite the opposite. Most of your experiments aren’t going to work, and the growth experiments are especially rife with unlimited permutations. Besides, now hundreds of thousands of start-ups and growth companies out there are building growth teams to chase after testable, and trackable short-term feedbacks and quickly jacked up the price for everything that is trackable and testable.