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Growth, and “growth hacking”, have become buzzwords in recent years. Companies often ask Modus to help jumpstart their app’s growth or help set up for successful growth within their organization. However, creating sustainable growth, especially in the rapidly changing environment we are facing today, requires a holistic understanding of your unique growth levers, as well as focus, robust processes, rigorous data analysis, and ultimately patience and persistence. Understanding what growth is about is a great start: exposing the value of our product to as many customers as possible, as often as we can. Using data and analytical rigor to hone in on the most important levers and opportunities, as well as always looking for the leanest way to test our hypothesis will also help ensure sustainable success.

What Is and Isn’t Growth

Many people and organizations seeking growth are disappointed that creating effective and sustainable growth isn’t about a few quick hacks (although those can be fun!). It’s also not about building the best product. We all know companies with great products that haven’t grown as well as companies that have experienced immense growth with only average products.

People often confuse the term “product growth” with marketing or product. These disciplines are very related, yet distinct. Marketing focuses more specifically on bringing in more customers, whereas product focuses on building value. Product growth spans across the whole funnel and focuses on making sure the maximum number of customers experience our product’s value as often as possible. As a growth lead, I’ve worked very closely with both product and marketing teams, and maintained a holistic approach to understanding and moving the most important metrics across the entire customer journey. As an example, one of our recent growth initiatives offered a one-time free credit report to customers coming from a specific campaign. This initiative stemmed from some Search Engine Optimization (SEO) insights and required some product changes, a customized landing page as well as some custom marketing campaigns.

Focusing on Growth

A dedicated focus on growth will create more success. This means identifying one or two impactful key performance indicators (KPIs) we want to positively affect and dedicating a properly stacked team solely focused on achieving these goals. Successful growth teams are often self-contained and have analytical, product, engineering, and marketing expertise. They are aligned to identify the most impactful opportunities across the entire customer funnel, based on potential impact and effort, and not the passion for a specific product or marketing channel. They also have the dedication and focus to patiently see experiments through, to carefully analyze results and to communicate learnings across the organization.

As an example, one of the most successful growth initiatives took us several months to implement and to see the growth. Several incremental steps were required, and gains took a while to propagate due to the nature of search engine algorithms. While we continued to concurrently experiment with quick A/B wins and with lean ways to test new revenue streams, it’s the meticulous focus on the Search Engine Optimization (SEO) channel that brought us the most value over that period.

It’s also easier to create a long term growth vision and culture of learning necessary for sustainable growth with a dedicated and focused team, propagating and evangelizing this mindset throughout the organization. We’ve seen a great level of excitement and impactful initiatives stemming from these cross-functional collaborations driven by the growth team’s efforts.

Growth Processes: Dealing with Change

While even one good idea can bring a significant improvement to a metric, a scalable and robust process is key to long-lasting growth. That’s because everything (and I mean everything!) changes all the time. The only constant is change. Even if we find a perfect Search Engine Marketing (SEM) hack or a lucrative optimization, these tactics are bound to stop working as soon as search engine algorithms, competitor tactics, and customer sentiments change. Additionally, these strategies will vary greatly from company to company and product to product. To create sustainable growth, we need to create a cadence around identifying our most impactful opportunities, formulating robust hypotheses, and creating an experiment portfolio containing a variety of bets. Inflow of fresh insights and new ideas from across the company is also important, and transparent processes and communication will help those outside the team contribute their ideas. Processes are also required to make sure we are rigorous, thorough, and methodical when interpreting and sharing results, as to drive our next experiment and longer-term strategy.

Analytical Rigor

Identifying our most important growth levers and our specific growth model will ensure we are focusing on the highest impact to effort areas and projects. Simply put, it’s about finding our most impactful growth opportunities within the customer journey. Identifying the number of users affected and predicting our ability to move the key metrics are key. I wouldn’t call an experiment that brings even 50% growth to a tiny proportion of customers a “success” unless we can extrapolate these learnings more broadly. Understanding our customer flow in, through and out of the app, with corresponding metrics and their effect on the business, and putting it into a coherent growth model will require some data analysis but will pay off in the long run.

Most if not all successful growth experiments come from either quantitative or qualitative customer insights. They are also driven by our ability to prioritize projects objectively based on their impact, the certainty of that impact, and required efforts and risks. Successful experiments aren’t usually based on “what’s the most fun to build”, “what project is favored by our CEO” or even “what makes the best product experience.” Although, hopefully, the changes are likely to create a better customer experience, be fun to build, and the CEO might like the results they see. We’ve found millions in lost revenue from simply fixing inefficiencies in log-in processes or helping explain our product value to a customer at a critical point, while many more ‘interesting’ initiatives end up not being noticed by customers or bottom lines.

We also need some statistical rigor to preemptively consider expected traffic and the potential impact of each experiment. A 1% gain in a metric can be easily testable within days for a large company or impactful metric (and can bring millions of dollars in impact). In contrast, a start-up with limited traffic and low baseline metrics will need more drastic changes, and/or methods other than A/B testing, to find growth.

Lastly, a successful experimentation process requires some analytical rigor — and often patience — to make sure that our results are accurate and unbiased. For example, turning off a test before it matures might show some falsely positive results. Likewise, only looking at the top metrics can identify a legitimate winner, yet can also miss an opportunity. In my experience, it’s often not the direct metric lift, but these other learnings that drive substantial future impact.

Patience

Successful growth is often incremental and it can take ten experiments to find one with a significant impact. It’s also tempting to call an experiment a winner as soon as we see a positive trend. It’s understandable as we want to keep learning fast and keep moving forward. However, patience and statistical rigor pay off, as implementing a non-impactful change can have vast direct costs and ripple effects. We’ve had dozens of situations where a significant winner turned into a loser after it ran for a week or two. It’s also important to determine the experiment’s duration in advance using a sample calculator and stick with a plan. Lastly, we need to remember that a successful experiment is an experiment with meaningful and useful learnings that can lead to the metric’s growth after several iterations, not necessarily always an immediate success. So, patience is key.

Product growth is a critical and distinct function within an organization and is not to be confused with marketing or product. Successful growth isn’t just about a few specific tactics. It requires methodical analysis of your most important levers, rigorous and disciplined testing as well as robust processes around identifying, testing and communicating potential opportunities.

Posted in Product Development
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Vera Ginzburg

Vera Ginzburg is a Sr. Strategist at Modus and lives and works in Silicon Valley. Her Carnegie Mellon MBA and 15+ years of experience leading Growth and Product initiatives and teams are a great match for her passion to help companies innovate, grow and build impactful products. Her broad experience includes companies such as Citibank, eBay and Paypal as well as several Silicon Valley start-ups, and whenever she isn’t working, she loves travelling, arts and learning.
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