2021 was a year of economic reactivation on a global scale, which contributed to the entrepreneurship train running at full speed. In 2022, the outlook promises to be even brighter. For example, according to the annual report of the State of European Tech, in 2021, Europe reached the largest portfolio of startups in its history. On the other side of the world, in India, the startup ecosystem achieved a record investment of almost 36,000 million dollars in private companies, tripling what was completed in 2020.

Some figures speak for themselves. One of them is the one published by the Startup Genome. They indicate that the global economy of startups has a value of more than 3.8 trillion dollars, which is more than the individual GDP of most of the G7 economies. Proof of this is that in 2021, the term “unicorn” used to refer to those companies that reach a valuation of 1,000 million dollars without having a presence on the Stock Exchange ceased to be an indicator of extreme rarity, to become the news of constant frequency.

So, it is clear that it is a great time for startups now. The topic is how to become one of those success figures; it is not just about starting a business, and the real question is how to make it scalable.

What Does It Mean To Be a Scalable Startup, And Why Is It So Important?

Scalability is nothing more than a company’s capacity for easy growth. However, to achieve this, some factors are needed, such as:

• Innovative value proposition
• Repeatable business model (deliver the same product on a potentially unlimited scale)
• high margin
• Wide distribution potential
• High risk-return

Its scaling consists of offering more without this, meaning an increase in production costs. In this sense, only a group of startups that arise annually achieves this quality.

The challenge for a startup is to achieve that innovative business model that allows it to take its company to the next level: going from a startup to a scale-up. Although today it may be difficult to imagine, companies like Instagram, or Facebook itself, began as startups, which had such a powerful value proposition that they soon became scale-ups and are currently the benchmark giants everyone they know.

Technology companies are the ones that have best adopted this philosophy and are considered the easiest to scale. For this reason, they usually get risk capital that gives them the necessary financing to grow their businesses.

In addition to generating greater profitability and making the business more attractive to investors, scalability also has other important advantages, such as internationalizing and entering new business lines.

Now that the definition of scalability and the elements that make a startup scalable are clear, it is necessary to understand what can be done to achieve it.

Growth Hacking As a Tool For Scalability

Although it may sound a bit evangelizing, many businesses want to grow but don’t know how to do it. Growth hacking has been the answer for them. Why? It’s simple, and growth hacking is an agile methodology based on experiments to achieve rapid growth.

To do so, the entire customer journey is analyzed to identify critical points that can lead to growth opportunities. All possible aspects are evaluated, from the marketing strategy to optimizing the product if necessary.

In short, it is a methodology that has a focus on growth and is based on a process driven by data and experimentation. In this way, it has become one of the favorite methods of startups to achieve scalability.

As has been said before, growth hacking consists of evaluating the entire customer journey to find aspects that can help the accelerated growth of the business. This makes growth hacking experiments personalized for each company, and there can be as many as there are customer journeys. For this reason, it isn’t easy to establish a single formula that can be applied to any startup. However, some general ones can serve as inspiration or a starting point.

Let The Numbers Chart The Course.

Among the most positive things about technology is that it puts an impressive amount of data at your fingertips, especially about consumer behavior. The first step towards scalability is the ability to dig deep into the data and analyze the available information to define patterns and draw conclusions that help define an effective strategy.

The data will make it possible to formulate hypotheses that give rise to experiments that contribute to clearing up variables until the ideal formula for accelerated growth is found. Likewise, information analysis allows us to know the consumer so well that it provides the necessary tools to make them the center of the strategy and create solutions that respond to their real needs. This has become the key to success for most startups that have achieved scalability.

As growth hacking puts it, it is important to analyze all the available information throughout the conversion funnel. It is only in this way that it will be possible to decipher how the consumer thinks and feels in each of the stages of the purchase process and identify the potential factors that are holding back the growth of the business.

Personalize The Experience

The key to achieving scalability is having an innovative value proposition. To achieve this, understanding the audience and determining how to add value to them is essential. One of the most successful ways to generate value is to create a personalized proposal. Experiences that seem custom-built and fit the consumer almost perfectly are often the most successful. Using analytics to incorporate messages, offers, or even customized products can be a way to generate a differentiating product or service, which makes people feel special, spread the word and grow the business at an accelerated rate.

Not Everything Is About The Product. Distribution Also Matters

It is common to see that when a business seems stagnant or does not have the expected growth, eyes turn to the product or service. One of the most important lessons of growth hacking is to evaluate all the steps of the customer journey, and, there, one of the most forgotten is the distribution channel. It is the least obvious, but it can become a success factor if it is adjusted properly. Having a great product is as important as knowing where to distribute it to arrive at the right time.

Although it seems that it is an element that belongs exclusively to the physical world, the truth is that the online world also has infinite possibilities for the distribution of products, and understanding them provides a very broad growth advantage.

Fear of Missing Out

FOMO is the acronym for fear of missing out, which translates to fear of missing something in Spanish. This term refers to the anxiety generated by being disconnected and missing something important. This fear points to a very basic and primal instinct: exclusion. Therefore, a growth hacking trick to scale a startup is to aim for it and generate products or services with a sense of urgency or exclusivity. Google used this trick during its email service Gmail, which was initially only accessible by invitation. A similar strategy was recently successfully replicated by the Clubhouse platform.

Free Sample For The Down Payment

Contrary to popular belief, a free sample is not synonymous with low quality. The truth is that all people love to receive gifts; Giving a free trial of the product or service that is offered guarantees the confidence and security that you have in the product. Additionally, this trick allows you to collect first-hand and reliable information about what people think about the product or service after using it, which opens an excellent window of opportunity.

Large companies such as Netflix or Spotify use this strategy to grow rapidly. Companies that offer software as a service and allow a free sample without leaving payment details generate twice as many customers from that free trial as those who request payment details.

Invite A Friend

For many years, the same clients who bring other clients have been a widely used strategy. In marketing, it is known as Member get a member, and its success lies in the fact that it offers a high return and is an “easy” way to get leads or clients since people trust the recommendations of their friends or acquaintances.

To implement it successfully, it is recommended that both the client and the referred friend receive a reward. This also creates a sense of belonging and permanence in people. Also, when the same client invites someone else, it is usually someone who looks like him, so the chances of success are greater.

The Power of Influence

Brand ambassadors are a great way to influence a specific segment of interest to achieve accelerated growth. Getting real brand ambassadors, who genuinely believe in the product, is the best way to influence people and attract them to a brand, product or service.

Brand ambassadors do not necessarily have to be famous people, and what is required is that they have credibility and influence others.

As has already been seen, the relevance of growth hacking lies in the fact that it can be applied in any phase of the business, from product development customer acquisition to customer retention and loyalty. These techniques are essential for a startup that wants to grow its business, thanks to their agile and flexible nature, allowing them to stay in the game and achieve that accelerated growth or scalability.

Although, on many occasions, growth hacking was thought of as opposed to traditional marketing, the truth is that both can and should coexist to generate a comprehensive strategy, where elements such as customer service, sales service and after-sales, among others. Shortcuts or growth tricks are not sustainable over time, nor are they substitutes for a solid global strategy.

However, if growth hacking is considered a way for business scalability, it is important to believe that it is not enough to know about traditional marketing. It is also necessary to incorporate concepts and practices from other fields such as usability and user experience. User, artificial intelligence, analytics, and many other areas allow us to articulate a real growth hacking strategy from startup to scale-up.

There are countless tricks and strategies to make a company scalable. However, it is important to keep in mind that the success of any growth hack depends on the individual situation, the startup, current trends and social circumstances. For this reason, experimenting, A/B testing, measuring and making adjustments on the fly is the only way to discover what works for the business.

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But What is Growth Hacking?

This concept is defined as a combination of curiosity, creativity and analytics that allows the number of users of a startup to grow in a hockey stick. These skills must be carried out by the founder and management team and be within the company’s philosophy (all workers must be aware of this trend in marketing).

Growth Hacking is a different way of looking at a market based on the need to find new ways of marketing to grow a business: it is not about specific techniques or tools.

This way of understanding marketing is the ideal one for startups due to the lack of resources, budget allocated to marketing products and making the brand known to the general public. In addition, it adapts perfectly to the Lean Start-up philosophy that these types of companies usually develop on a day-to-day basis.

The people who develop Growth Hacking strategies have a very specific profile, and that can be divided into three main blocks:

• They Are Analytical. Those who work on Growth Hacking optimally analyze even the smallest detail, both in their work and professional life. When something fails, they give it a thousand turns until they find the explanation for the error. They are always studying metrics. Even if there is no model, they make it up.
• They Are Creative People. Inventing marketing actions is not expensive. You have to think about it. Growth hackers have that gift of finding solutions to a specific problem through creativity, focusing on their resources. They are people who, by nature, dare to take risks.
• They are The kings of “why”. All changes are questioned, whether they are for the better or the worse. They are never left in doubt and, if they have to work harder to understand it, they stay until they find the solution.

How To Do Growth Hacking

Doing viral marketing campaigns through Growth Hacking is simple: in fact, everyone should test themselves to see if they are capable. You have to follow five concrete steps and make sure that each has been completed before moving on to the next one.

1 – Product / Market Fit

This is what is known as the “fit” between the product and the market. When starting a project, the first thing is to see if it will have acceptance in the market in which it will be put on sale. If not, better put the project aside.

It is essential to talk, in the first place, with testers (they are usually found among friends and close people) who say, honestly, whether or not they would buy the product.

It is better to invest in developing a product that can be sold than to devise marketing actions that make the brand known. Not a few have fallen into this trap: investing time, resources and money in marketing actions for a product that had no place, in any way, on the market.

2 – Grow Hack

In the United States, they call, in this way, the search for marketing actions that will position a brand in the market, but in which the product they sell and, above all, its use, have a prominent place.

It can be done if the actions of some markets are taken as a model, through social networks, showing videos of the use of the products on the wall of the followers, for example.

3 – Viralize

Once the marketing action is defined, it is necessary to make it known to the general public. Thousands of activities can be carried out (hence the creativity mentioned in previous paragraphs).

Why did Hotmail grow so much? Simply because it was the first platform to offer a free email account.

In this sense, we can take, as an example, the policy of Dropbox, which began to grow when it offered free space to those who invited friends to create an account; Spotify, after its integration with Facebook; or Airbnb, after its integration with Craigslist.

4 – Build Customer loyalty

We are giving the best after-sales service and working on the web and social media profiles to improve the user experience.

If they get loyal customers, they can become brand preceptors: people trust their friends much more when buying a product than in brand marketing actions.

5 – Back To The Start

Growth Hacking is a living and active entity that must evolve, as do other brands and customers’ needs.

At this point, it is time to analyze the results obtained with the different actions and ask yourself why they have worked and why not. It is necessary to move forward and find new methods to promote the company; if not, there is a risk that the competition will evolve and subtract users from the brand.

Why Start Growth Hacking in a Startup?

As you can see, Growth Hacking is working (and very well) for companies of all kinds. Perhaps the clearest examples are those of film and television, but due to the creative charge of the product.

It is not strange to come across examples of Growth Hacking on the street that are working perfectly for the different brands. And it is that every time, more SMEs are signing up for this promotion trend (without even knowing the term). They copy and adapt to what the big companies are doing and get more than acceptable results.

YouTube and social networks are great allies for those who have a small budget for the marketing and commercialization of the product. Having a channel with followers and profiles that work and that are an updated and two-way communication channel with the users of the products is key to developing these strategies.

The Internet is a perfect tool to raise passion regarding a product or service. Generating expectation is the most recurrent technique for the strategy to succeed. In addition, this process allows discovering new uses and new outlets for the products marketed by a specific brand.

The post What Is Growth Hacking and Its Strategies? appeared first on TechReviewsCorner.