Growth Marketing Playbook: Introduction
The Growth Marketing Playbook is aimed at experienced marketing professionals and startup entrepreneurs alike. They key is that whether your business is large or small, you need to adopt the mindset of a startup in order to move fast.
This playbook contains a set of five steps together with best practices designed for you to focus on customer growth and retention.
CONTINUE TO STEP 1|
Pirate metrics …AARRR
Entrepreneur and author Dave McClure has defined five “pirate metrics” (named for their acronym: AARRR) that should be part of every growth marketing strategy. They are listed in the order in which they take place. This customer acquisition sequence is similar to that seen in a sales funnel:
- Acquisition: The number of users who respond to your marketing by visiting your website
- Activation: The number of users who have a positive experience on their first visit to your website
- Retention: The number of users who return to your website after the first visit. The key to startup growth is retention. If you can get customers to become loyal, you have a viable business model. Long-term retention is signal you are scaling
- Referral: The number of users who recommend your startup to others. If you can bring on new customers, retain them for the long term and get them to invite their friends, then you’re running a great funnel
- Revenue: The number of users who become customers by taking an action that results in revenue. To survive, your product has to solve a real problem for your customer and create so much value that a customer stays for the long-term and refers friends
Get key insights on customer development from growth marketing expert, Alison Gibbins.
Video transcript | Growth Marketing Playbook: Introduction
Hi! Welcome to the growth playbook.
This playbook is a simple set of frameworks, tactics and best practices designed for you to focus on your customer growth and retention.
Simply put, growth is everywhere you haven’t been as a startup. We’re going to help you get there.
The intention of this playbook is to answer the fundamental question: “How do I get, keep and grow customers for my product?”
Our playbook is the accumulation of lessons learned from a new program at MaRS called GrowCamp. It’s a multi-week series of experiential workshops and guest talks from top growth practitioners designed for both startups and larger companies.
We talked with startups from across different sectors to bring you the very best insights from their growth marketing tactics.
We have a few things we want to cover before we dive straight in.
Don’t take on too much product risk before you start marketing and acquiring customers.
If you have yet to go through the fundamentals of Steve Blank’s Customer Development methodology, defer marketing, monetization and scaling. If you want to acquire new customers, you need to find out why they need it.
Most of what we cover in this playbook is relevant after you’ve done some validation of your product in the market. Start with those lean methods first.
Check out the resources in this playbook on customer development.
For the following lessons to be useful, you need to have designed a minimum viable product and developed a prototype to run loops of customer discovery with real feedback from potential customers.
On top of that, it’s important to have started to explore modelling the usage of your product and understanding the customer pain points and problems you’re solving. This is an important part of your business model because it connects your value proposition to your customer.
Even further, you’ve already developed ideas and options for distribution. And have the basic infrastructure your product needs to have in place for scalability. If you don’t have a scalable, repeatable business model, focus on that before you start growth marketing.
We’ve built this playbook to be scalable with your business.
Zero growth happens unless you have an incredible team to execute with and identify the people who will be responsible for your marketing campaigns.
Now, let’s take a look at your customer acquisition funnel.
The funnel is a path for customer flow and acquisition—from on-boarding a customer to their initial product experience. It’s critical that each stage of that funnel is well-optimized.
What’s the customer lifecycle for your product? What are all the actions you want your customer to take to convert and become an active and loyal user?
A simple way to model your customer acquisition and retention funnel is to break it down into five stages.
Dave McClure of 500 Startups introduced us to “pirate metrics,” which is a great resource to review to understand each stage of the funnel.
Let’s quickly run through each stage. First, you have the top of the funnel:
- Acquisition: Our playbook largely covers the awareness and acquisition state of your customer. It is the “how” you get people to discover and learn about your product.
- Activation: Activation is the intermediate stage between acquiring and retaining a customer. For instance, let’s say you visit Airbnb. That means they’ve “acquired” you. If you then decide to browse a listing, sign up for an email, or register, that means Airbnb has “activated” you. In growth marketing, your job is to move customers from one stage to the next consistently.
- Retention: If you’re curious what matters most for startup growth? It’s retention. The key to growth is retention. If you can get customers to become loyal, you have a viable business model. Long-term retention is actually a signal you are scaling.
- Referral: Next you have referrals. These are different from acquisitions or retention. Referrals can be continuously generated. If you can bring on new customers and retain them for the long term AND get them to invite their friends, then you’ve got a great funnel happening.
- Revenue: Revenue comes from value. You need to be systematic about creating value. Think about building long-term sustainable value. To survive, your product has to solve a real problem for your customer and do something amazing. It has to be hugely value-creating to get a customer to stay on for the long term and refer friends.
You’ll want to map out the funnel for your product.
It’s important to go optimize and A/B test across all the stages of the funnel. You should understand your customer cost per acquisition.
Enter growth marketing.
We encourage you to navigate through the full playbook before going to the 5-step framework next.
The guide is a collection of interviews and articles from leading marketing experts and top Canadian entrepreneurs. We explore how to get traction and how to effectively and systematically test marketing channels.
We pull insights together from top practitioners to learn why developing a growth mindset is critical to scale. And how to think and act in different aspects of developing your growth strategy.
We look at many of the obvious channels, from social channels to search engine optimization and referral tactics. We then explore some of the strategic tactics that can help your startup cut through the noise and acquire real customers.
Let’s get started.
|Startup marketing: Get, keep and grow||Customer development is critical. In this blog, Nathan Monk discusses on customer relationship strategies, also known as the get, keep and grow (GKG) tactics of customer development.|
|Market research||New to market research? This cross-sector collection of MaRS resources on market research will have you researching like a pro.|
|The Customer Development Model (CDM), product development and technology startups||Get an overview of Steve Blank’s Customer Development Model. You’ll be glad you did.|
|Value proposition and Blank’s customer discovery method—Phase 1: State your hypotheses||Learn more about Blank’s Customer Development Model—in particular, details on the customer discovery phase. This is key to arrive at a solid value proposition.|
|Develop your value proposition and business model using customer validation||Learn more about Blank’s Customer Development Model—in particular, details on the customer validation phase. This is key in building and validating your business model.|
|Marketing strategy for startup success: Identifying and understanding your target customer and market segments||Did you know that the process to determine the target customer for an innovative product differs from the process used in a more established marketplace? Find out why.|
|Product development: Minimum viable product (MVP) approach||Don’t miss the chance to get valuable feedback from early adopters. Find out why launching an MVP is effective and the best method of product validation.|
|Learn the benefits of minimum viable product (MVP) development
||In this three-minute video, Jake Hirsch-Allen, Partner, Functional Imperative, tells us why to use an MVP.|