Growth Hacking vs. Growth Marketing

“We need a viral growth hack!"

"Have you tried giving out freebies like Dropbox?"

“Should we opt for guerilla marketing tactics like Boldcare’s founder - Rahul Krishnan?”

“Is the sleep internship at Wakefit real or just another marketing gimmick?”

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You've probably heard these conversations and contributed to them.

The quick wins and viral growth are tempting, but is it the right approach?

A lot of founding teams are consumed by the allure of ‘growth hacking’ and false hope that it'll be their silver bullet to increasing their revenue.

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The dilemma is real, and the confusion even more so. 

Growth hacking is not, absolutely not a magic trick. 

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And let's be honest - I hate the term "growth hacker." It oversimplifies the complex process of building sustainable growth and creates unrealistic expectations for founding teams.

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Let's clear the air about what growth hacking and growth marketing really are, and more importantly - what works when. 

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Before diving into the debate, let's understand the complete user journey:

1. Awareness
2. Consideration
3. Decision
4. Purchase
5. Post-Purchase
6. Referral
7. Repeat Purchase

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Each stage requires its own strategy, metrics, and approach. Growth marketing acknowledges this complexity - growth hacking often doesn't.

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Understanding Growth Marketing

As easy as ABC – growth marketing is not a single campaign, and it’s definitely not a one-time hack. Growth marketing is a systematic process built on four key pillars:

• Consumer Insights: Understanding user behaviour and needs
• Hypothesis Building: Creating testable assumptions
• Experimentation: Testing in real-world conditions
• Analysis & Iteration: Learning and refining
  

The idea is to constantly optimize each stage of the marketing funnel through data-driven experimentation.

The beauty of this process lies in its versatility - it seamlessly guides everything from creative development and messaging strategy to channel selection, campaign execution, and feature rollouts.

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Understanding Growth Hacking 

Growth hacking is often portrayed as a magic formula that can give infinite leverage to startups.

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As you see – growth hacking does have its place in the user journey. It is all about using quick-win tactics to amplify specific phases of the funnel.

Common practices are: 

1. Awareness hacks: Piggybacking on social media by sharing a meme or a controversial option. We all know what Rahul Krishnan did – shared his credit card details in a tweet for purchases up to 1000 INR. It did fetch him a lot of eyeballs and up-stick in his Twitter follower base.  

          Another example is Wendy’s, known for its witty Twitter banter and the “Roast Me” campaign.

          We are all still tripping over “Indiranagar ka gunda hu main!”, aren't we?

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2. Discounts: Buy one, get one free offers or limited-time discounts can nudge users into making the purchase. These time-sensitive deals create a sense of urgency, pushing users towards immediate action.

            Fun fact: Coca-Cola is credited with introducing the first coupon in 1887, which allowed recipients to redeem a free glass of Coke.

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3. Referrals: No surprises here—referral programs have stood the test of time for a reason. In its early days, PayPal offered $10 to users and an additional $10 for every person they referred. This campaign garnered a lot of attention and sign-ups.

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4. Waitlists: The "invite-only" strategy or exclusive waitlists build hype and FOMO (Fear of Missing Out). Juleo, Openvy, Arc Browser and a lot of brands are opting for this. OnePlus did it too! 

            While these hacks can drive short-term results, they’re not the backbone of a growth strategy.

The Bitter Truth about Growth Hacking

Many people opine/think growth hacking can replace a solid growth strategy. Well, absolutely NOT! 

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I said I hate the term “growth hacker” for a reason. 

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Hacks often bring in users who are only there for the incentive. And you can’t sustain those customers, forget about repeat purchases and brand loyalty!

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Take the classic example of Dropbox offering free storage for referrals. 

It worked wonders to bring in users, but how many of them stuck around? How many of those are paying customers?

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Growth hacks can skew your perception of product-market fit. 

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Let’s say you run a viral referral campaign and bring in 1,000 users in a week. 

You might think, “Great! We’ve nailed product-market fit.” But if none of those users convert or stick around, it’s clear the product didn’t match the market—people just came for the freebie. 

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If you are an early-stage startup, and if you’re still figuring out your product-market fit, growth hacks can mislead you. 

The users you attract might not be genuinely interested in your offering. This can definitely result in spending more to acquire genuine customers a few weeks later. Yes, I am talking about CAC here. It should reduce over time. 

It is important to understand that growth hacks should amplify an existing growth process, not replace it.

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The Growth Marketing Advantage

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Unlike growth hacking, growth marketing is a repeatable process and relies heavily on number crunching.

From tracking CTR at the creative level to calculating lifetime value (LTV) & customer acquisition cost (CAC), honestly, every decision is rooted in numbers. 

The path to sustainable growth isn't through shortcuts. While growth hacks for quick wins can help, they should/will never replace a well-rounded, data-driven strategy. 

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Here are key points to remember:

• Build systems, not hacks
• Focus on user value
• Measure what matters
• Think long-term
• Test, learn, iterate

In a nutshell, Growth Hacking is like adding fuel to a well-functioning engine, but the engine still needs to be strong in the first place.