What is Growth Marketing?

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What is Growth Marketing? Its a topic I’ve written about in the past, specifically around the keys to hiring the right talent. All of my working life is devoted to this topic, as a result I often forget how fresh and new growth marketing still is for many people out there!

Recently, I was asked if I would teach an online course focusing on the basics of growth marketing for folks who are interested but completely unfamiliar. That was a really fun process and something new for me — what I realized is that I had never properly done an introduction to the growth marketing concept. This post should serve as a starting point for anyone who has asked the question, what is growth marketing?

Traditional Marketing

The most popular college major is Business/Management, and a large portion of these specialize in Marketing, or at the very least take Marketing classes. Despite this, in my personal experience most professionals who end up as marketers don’t have much academic experience in Marketing. While I am a believer that most useful knowledge relevant to work is learned on the job, I also believe it’s very helpful to understand some core ‘traditional’ marketing concepts nailed down before diving deep into growth marketing.

The American Marketing Association is a great resource for anyone interested in learning about Marketing. The define the practice of Marketing as “the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.” This is a good starting point for understanding what Marketing is.

The next big concept to understand about traditional marketing is The Four P’s. This concept was popularized by Professor Jerome McCarthy in a classic text from 1960 called Basic Marketing: A Managerial Approach. There are countless resources out there that can go into depth around each of the 4 P’s, but suffice it to say it’s important to understand that marketing centers around the mix of Product, Price, Promotion, and Place, as it relates to the target market you are trying to serve. The marketing mix idea is simple to understand, but incredibly complex to execute well. Simply put as a marketer your job is to put the right product in the right place, at the right time, and at the right price.

Note: you will also sometimes see similar models that include 7 P’s or 4 C’s. The basic concept around the marketing mix is the same.

 

marketing mix
Marketing Mix

 

What is Growth Marketing?

Now that we’re done with the basic marketing refresher I’m sure you want to know, well… What is Growth Marketing? Here’s how I define it:

Growth Marketing is the activity, set of institutions, and processes for growing an audience, community or customer base in a dynamic market with resource constraints.

As this is a relatively new area, you’ll likely find a lot of different definitions from experts in the field – at this point no one is wrong, and in fact, you might end up making up your own definition! I will share my view on it and you can form your own opinion.

Let’s break down my definition of what is growth marketing:

…the activity, set of institutions, and processes

This is the system of work for doing the marketing, the same as the marketing definition from the AMA I included above. I used the same start for the sake of consistency and also to make it easier to compare/contrast, but it’s a bit formal sounding. The point is, this is the ‘what you do’ part of growth marketing.

…growing an audience, community or customer base…

This is important because whereas traditional marketing tends to have a consumer focus on delivering a product to your target market and leading to purchase, in modern growth marketing you are more focused on growing your audience. The monetization (sale) aspect is important of course, but usually is not be the primary focus when you are in growth mode. There are some really big recent examples of growth companies that were very highly valued because of the happy base of users they built up, without trying to get them to pay anything. In fact, the modern consumer expects to get something for free from any product they are considering, and are highly resistant to paying until the value has been demonstrated. Also, due to the power of the network (which I discuss below) a lot of products have a lot more value when the network using them reaches a certain critical mass, so the focus should be on rapidly growing the base rather than selling something.

…in a dynamic market with resource constraints.

One of the cornerstones of growth marketing is taking a ‘scrappy’ approach and being flexible to the changing market you are operating within. When you are in growth mode your company likely doesn’t have millions of dollars to commit to a massive marketing campaign, and because the market itself is probably evolving fairly rapidly you need to use scarcity to your advantage and look for ways to engage your audience without pushing out messages super broadly. Often times, you won’t even be operating in a well defined market because the product is so new and unique! Be prepared to move fast, test things on a small scale, and go big when you find success.

Growth Marketing Principles

How do you go from definition to practice? I propose to supplement the ‘traditional’ marketing 4 P’s with a set of concepts for how to think about the growth side of marketing. Because I am a marketer first and foremost, I had to come up with my own clever naming convention, so I stuck with the P’s alliteration. In this case, I wouldn’t call this the growth marketing mix, rather I use this as a set of principles to align to.

The growth marketing principles are:

  • Power of the Network
  • Push vs Pull
  • Proving
  • Personality

Each one of these principles deserves its own article or series of articles, but I’ll start with basic summaries for now.

Power of the Network

Simply the value of a product or service is increased by the number of others using it. This is the power of the network. Facebook famously has more users than any one country in the world – with a little investment of time and sometimes money, any marketer can reach a vast number of people. Of course, others know that too and online audiences are fickle, so you are always fighting for eyeballs and attention. At the end of the day, the product that gets the most interest (if it does indeed deliver the right value for the audience) wins.

Push vs Pull

Push vs Pull could be confusing, but it boils down to a simple concept. You push out your marketing messages (like the ‘promotion P’ from McCarthy’s mix) but you also want a pull where your audience actually finds you and seeks you out. The easiest way to draw people in is through solving a problem via the product, or just making something better than it was before, and appealing to the network to distribute your message. That way you are amplifying the impact of your messages without additional effort. Sometimes you will hear this referred to as inbound vs outbound, where outbound tends to be using money to distribute your message to the desired audience. In my experience it’s very rare to see a high-growth company exceed without a mix of both – the exact mix is very dependant on the organization, the product, the competitive environment, and so forth.

Proving

Marketing is famously difficult to measure, but it’s getting easier and easier thanks to digital tools and technologies available to us. Modern marketing technologies such as Google Analytics and marketing automation platforms allow marketers to see their results in real-time and compare different messages and formats to determine to continuously optimize. A core principle of Growth Marketing is measuring the right things to be able to see where the biggest impact is in terms of money and effort spent, and to continue and increase efforts where successful, and reduce or eliminate those that are not. Growth marketers use the proof of the results to decide where to invest time and money in future endeavours.

Personality

The Personality of modern brands is hugely important, but is also one of the toughest concepts to think about academically, because it depends so much on the tastes of your audience. The core idea is that a brand must be relatable, and behave more and more like a friend you know and trust, rather than a massive, faceless organization. Brands can be relatable by making sure they appeal to their audience and the aspirational qualities they might have. The esiest example here is Apple – almost everyone that owns or uses Apple products or has been in an Apple Store knows this brand personality is strong. In fact, Apple is the most valuable brand in the world. This is because their core audience places such a high value on the products, specifically the aspiration of what those products can do for them. If you are a designer, it might invoke images of effortlessly creating prototypes. If you are a music producer, you are thinking of mixing songs on your MacBook pro in the studio.

Traditional Marketing vs. Growth Marketing

Traditional Marketing
Growth Marketing
-Careful research, planning and execution
-Stable markets
-Large budgets
-Marketing at scale
-Time to measure
-Long campaign cycle
-Rapid hypothesis creation and deployment
-Dynamic markets
-Low cost
-Personal marketing
-Real-time results
-Iterate and improve

 

Applying Growth Marketing

There are 4 keys to keep in mind in applying a growth mindset to your yourself, your immediate team, or your broader organization:

  • Always deliver value,
  • Go fast but start small
  • Scale with success
  • Listen to your customers

Growth marketers always deliver value, by showing clear progress against a defined goal or objective. Progress in this case could be learning what doesn’t work so you can apply that knowledge and improve, so it doesn’t just mean being successful. The point is to make sure your efforts are focused on a measurable end result that will help you grow now or in the future.

Go fast and start small: thanks to the agility of modern technology, it’s easier than ever for individuals to create a hypothesis, then go to market and execute at a small scale to test it. In fact, you can have a series of hypotheses about any given challenge, and then test each one in turn, learning from each and then applying that knowledge. The important thing is to not wait until you have the perfect plan, because no plan is perfect and you never know how the market will react. The key is to test things in the market as quickly as possible to get feedback and improve.

Scale with success relates in a big way to the ‘go fast and small’ approach above. Once you have found some indicators of success, then you can scale your idea or program to capture as much value as possible. You’ll often hear marketers talk about doing A/B tests, where they test two things like ad copy or an email subject line against each other with a small sample, and then launch a marketing program using the winner with a much larger sample.

Lastly, always listen to your customers, both internally and externally. While it’s great to use data and analytics for an impartial view measuring the success of what you are attempting, you cannot lost sight of the individuals and the perception you have, whether it’s yourself or your company brand. Make sure you don’t just keep your head in spreadsheets and technology, but pull up to survey your audience to see how they are reacting to your growth efforts, and apply that feedback to what you are doing.

If you keep these keys in mind while attempting to adopt a growth attitude, you are much more likely to find success.

Hopefully this post helped to answer the question “What is Growth Marketing?” and provides a conceptual framework anyone can apply within their teams or organization. As always, feedback is welcome!

Learn more with Baxter's excellent Growth Marketing 101 course on Illumeo.

Originally posted on Baxter's blog.