Introduction To Growth Hacking

Introduction
to
Growth
Hackinge
Growth
Ba
langHacking
Muhammed Tfekyapan
leanmarketing.co
introductiontogrowthhacking.com
What is the Growth Hacking?
Introduction to Growth Hacking

Muhammed Tfekyapan
2015
leanmarketing.co
Published by introductiontogrowthhacking.com
None of the contents and chapters here in can be
copied or cited without the express permission of
the publisher.
Turkey / Istanbul
Please think before you print.
About the writer
He began his studies in 2009 at ITU.

After taking part in various projects
as a project and product manager, he
founded Lean Marketing, which is a
marketing blog for startups. In 2015,
he published Turkeys first and only
Growth Hacking book. He currently
trains others in Growth Hacking, as
well as providing consultation and
support to startups to help them
achieve growth.
Foreword
The Lean Marketing blog came to being at the beginning of 2015, as

a collection of my writings about internet ventures. I ensured that
the content in its entirety offered the readers the kind of information
that can be utilized in terms of strategy and business tactics. While
the feedback I received encouraged me to continue publishing the
content, it also enabled me to see that I still had a lot to learn.
Introduction to Growth Hacking, which you are about to read, is the
product of that excitement and motivation.
As you will discover in the coming chapters of the book, I aimed to
shed light on common misconceptions that internet ventures (startups)
can fall into (or are led into), as well as to offer insight on how the
growth process for a product should be handled, what sort of methods
need to be followed in the design phase, what kind of actions need to
be taken, and tried to present all this information in an easily
applicable
format that makes space for viable results. If, as a result, internet
ventures gain a degree of awareness on the process of growth and
become more knowledgeable in terms of their approach towards
growth planning and review, then this book will have accomplished
its purpose.
Before I let you get started, I would like to thank my dear friend
Serkan nsal for all his support and help during the whole writing
process. Without his unconditional support and help, this book would
never have been written.
I would also like to thank Cem Hrtrk and ismail Tunal, as well
as the whole Sendloop team for their insights and support. They helped
make the book much richer with the valuable information they
provided.
Thanks to the design work of Damla Kocaman, the book became
much more exciting and readable in terms of imagery. I would like
to thank her for all her hard work.
Lastly, my thanks go to Ayse Tosun, who took on the challenge of
correcting all the grammar and punctuation throughout the
book.
I hope this book contributes to whatever it is you are trying to
achieve.
To My Family...
Index
1. What is the Growth Hacking?

2. Growth Pyramid for Startups
2.1 Product/Market Fit
2.2 Transition to Growth
2.3 Growth Phrase
3. DNA of Growth Process: AARRR

3.1 Acquisition
3.2 Activation
3.3 Retention
3.4 Referral
3.5 Revenue
4. Growth Hacking Mistakes
CHAPTER I
In order to understand Growth Hacking, one needs to briefly look

into the concept of startups. What do we mean exactly by that word?
Could it be described as a product that operates on the internet, or
via a software? If you have a newly founded company, or a company
that has been recently invested in, would that make it a startup?
Paul Graham answers all these questions on his article titled
Startup = Growth. According to him, if a company is working on/
with software, or if it newly founded/recently been invested in, it
does not necessarily qualify to be a startup. In his opinion, in order
for a company to be defined as a startup, it has to target a large market
and use technology as a tool to resolve the problems of that particular
market.
For instance, every company today needs a web site. This is a problem
with two solutions: either a tool that can help people create their own
websites is developed, or specific deals are made with clients to create
unique websites for them. If you go with option one, and the said
technology is developed, whether it is 100 clients or 1.000.000, they
can each create their own website with ease. In the second option
however, things are different. When you are developing a specific
and unique solution for your client, youll need a designer, a developer
and a project manager; so in order to reach 100 clients, its only logical
to assume that you will be needing 100 of those each. Since technology
is used to resolve an issue in the first option, that makes the company
in question a startup, whereas the second option just makes it a regular
company.
Having made that differentiation, we can venture to say that startups
are companies that target a large market and reach that potential by
using technology coupled with scalable methods. Such startups with
the said structure have different types of problems and different
needs in comparison to other businesses. That is where the foundations
for the concept of growth hacking are laid. So when the question
What is growth hacking? arises, the definition could very well be
the discovery of potential issues standing in the way of growth for
startups, and the development of innovative solutions for the said
issues. Now, lets talk a bit more in detail about the terms growth
and hacking to get a better grasp on this concept.
What Is Meant By Growth?
In reference to the previous example, we can safely say that the
growth processes for a technology that enables clients to make their
own websites and a company that makes websites are dramatically
different. If startups choose to follow the standard methods for
business growth that are typically prescribed to normal companies
and try to implement them for their internet based business, that
attempt will almost certainly end in failure. Startups need to consider
their goals, their structure and resources carefully and chart their
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own course for growth. That is why, the concept of growth should
not be confused with the idea of increasing the traffic for a specific
website. This concept encapsulates the charting of a course that
carefully considers the dynamics of the product, the market and the
client in question and suggests a certain unique journey for growth.
This journey involves focusing on each issue one by one and defining
specific points for success.
What Is Meant By Hacking?
The term hacking is where the overall perception towards the
concept goes wrong. The initial impression is that hacking is the act
of unlawfully/wrongly coming into possession of an application or
data, that is to say, software piracy. So when we say growth hacking,
one might easily pick up on the idea as if it involves primitive spamming
methods, such as auto comment bots, or follower boosts.
In truth, the term hacking, when used in a non-software context,
refers to the act of following innovative and non-standardized methods
or predefined processes and developing much more effective solutions
when one is trying to solve a problem. In the section about growth,
we mentioned the steps one needs to take in order to grow a startup,
and the types of problems that need attention. With the term hacking,
we specifically refer to the act of discovering ones own methods to
accomplish their goals.
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Example: An Overview of Everpix

Everpix was an application developed in 2011 by a very capable team
of developers, and it garnered a great deal of attention when it
launched. It offered a platform that enables to easily manage your
photographs, solving a problem that most of us deal with today, and
doing so in a technologically sustainable way. If we review Everpix
in the light of what Paul Grahams definitions, we can safely say that
it fulfills both conditions to be defined as a startup.
Everpixs journey, which started in 2011 ended in November 2013,
with an ending that offers quite a lot of insights for entrepreneurs.
Before we get to the reasons why it failed, lets take a look at what
Exerpix did during its lifespan with some very basic metrics.
In graph 1.1, we see Exerpixs new user conversion rate performance.
Its higher for some months, and lower in others, but we can still
observe a steady monthly increase.
As a mobile application, Everpix follows the freemium model.
Grafik 1.1
While it offers a more limited version of its services for free users,
it offers the full experience for the annually or monthly subscribers.
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Graph 1.2 displays the changes observed in the number of annual

and monthly subscribers. Both numbers display a steady increase.
Grafik 1.2
Lastly, we have graph 1.3, where we can observe the usage rates for
the application. The users did not just install the app and forget about
it, we can see that they used it regularly after installation.
Grafik 1.3
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Some additional figures from the journey of Exerpix are as follows:

55.000 users in total

6.900 premium users
Premium packages with $4.99 for a month and $49.99 for a
year
Free user to premium user conversion rate is 12.4%
4.5 out of 5 in the App Store with more than 1.000 comments
2.3 million USD total investment
Why Is Everpix Not Around Anymore?

Despite all these exciting figures and facts, Everpix is no longer
operational.
What was it, then, that made such a promising startup that was
loved by its user base, had a revenue model with monthly and annual
subscribers and a positive growth momentum a failure?
When we look at how Everpix operated, we see that the team focused
on the product itself intensely. As a result, the necessary effort and
resources for growth were not set aside, which brought Exerpix to an
end. We all know that the once famed internet entrepreneur motto
build it and theyll come is no longer relevant. In order for startups
to be successful, good ideas and MVP are not enough, they also need
to discover their potential for growth and their journey of growth,
and place that idea at the core of their startup from day one.
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CHAPTER II
Growth Pyramid for Startups
Growth is at the core of startups. But how does growth happen?

How does the current state of the startup impact what needs to be
done in order to achieve growth? Sean Ellis Startup Pyramid Theory
answers all those questions.
Product/Market Fit
Transition to Growth
Growth
15
According to the theory, the journey to growth consists of three

main stages. Before we can talk about growth, a certain degree of
compatibility needs to exist between the product and the market.
After that is established, the startup then follows a growth plan, and
finally, achieves growth. Lets take a look at these three stages to get
a better grasp of the concept as a whole.
A.
Product/Market Fit
Marc Anderssen describes product/market fit, or P/M Fit for short,

as being in a good market and being able to satisfy its needs. When
we consider that definition, we see that there are two main parameters
that need to be met:
1. Being in a good market
2. Being able to satisfy the needs of the market
In order to understand the idea of P/M Fit better, lets consider our
initial example in the context of these two fundamental parameters.
Lets say that you notice that some of the businesses around you
are experiencing serious issues with their websites. They are unable
to make the developments they wish to make and cannot get the
desired level of performance out of their websites. After conducting
some research, you discover that the problem is true for various sectors
and companies. Some more market research later, you realize that
this is a national and global problem. After deciding that this is a
market opportunity, you decide to step up as an entrepreneur and
believe that you have a solution to this problem.
Therefore you begin to work on a tool that enables people to build
their own websites. At the end of your initial process, you gain MVP
and start inviting your social circle to use the product. You also try
to garner attention by making small marketing attempts to connect
with your target audience.
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But along the way, you realize that there is a problem. While you
are doing your best to gain new users, the users you end up gaining
are not actually interested in your product. They only browse it for a
few minutes, then leave and do not come back. While your goal is to
enable people to build their own website by your tool, you see that
they leave after a few attempts. Although you want to grow fast, you
are also curious to know why your product is not used. You are,
therefore, stuck between two big problems.
What happened up to this point is something that most entrepreneurs
go through with varying degrees of difference. A large portion of
startups get stuck in this stage without ever realizing what the problem
is, and before they can do so, their resources run out. The problem
lies in the fact that the P/M Fit is not yet established, or the fact that
you are unable to satisfy the needs of your market.
1. Finding the Right Market
If you are not in the right market, that is a situation stemming from
the fact that the problem you are working to resolve is not relevant
to your target audience. This is caused by inadequate research in the
product development stage or missteps taken during the research
phase. Or it might just be the fact that your target audience is oblivious
to the topic that you define as the problem. For instance, while you
state that their websites have issues that need to be fixed, they might
just say that they are happy with the services that they receive through
the website.
Another reason might be that your target audience is already aware
of the problem, and they might even express that this really is a vital
issue, but they might eventually lack the resolve and motivation to
find a solution for the problem. They might see it as not important
enough to dedicate resources to. To refer to our example, they might
feel that the website needs to be renewed, but would not have the
motivation to dedicate their budget or time to actually do so.
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If your startup has such a problem, you will probably need to work
on the customer development part of things, as well as reconsidering
the position of your product as a whole.
2. Satisfying the Needs of the Market
The second main issue in achieving P/M Fit is the inability of the
product to satisfy the needs of the said market. In reference to our
example, lets assume that the target audience does wish to renew
the said website. Our first users are here, and they are trying to use
the product. You receive an e-mail from one of the users saying that
they would like to use a popper type menu for the particular website
that they are building, but they seem to be unable to locate that option
(which is available in the effects section). Another user states that
they would like to create the internet site from their tablet, but the
application does not seem to properly function when viewed from a
tablet. Another one states that he is unable to share the work with his
colleagues, and that he has to take screenshots for every frame of
work he has done, which has resulted in him losing too much time.
As the list of problems goes on and on, you begin to realize that the
target audience does want to use the product, but the product itself
is unable to respond to their needs properly.
The most vital point in the event of a products inability to satisfy
the needs of a given market is the fact that most of the time, the users
themselves are unable to identify the problem they are experiencing
themselves. In order to overcome such issues, you need to work on
both the technical capabilities and performance of your product, as
well as the user experiences related to that product.
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The life of any startup can be divided into

two parts - before product/market fit and after
product/market fit.
Mark Andreessen
Tweet
3. How Do You Measure P/M Fit?

When we review attempts made at achieving P/M Fit we can identify
two main characteristics, which are:
1.
When P/M Fit is achieved, a large portion of the users will be
likely to exhibit habit-like behavior towards the product. By reviewing
your product churn rate via cohort analysis, you can analyze the
number of active users your product regularly interacts with on a
daily, weekly or monthly basis.
2.
You need to review the success rate of your users interactions
with the product. How much of your user base is able to resolve their
problems by using your product? In order to talk about P/M Fit, you
need to provide a sustainable and tangible solution to the problems
experienced by your target audience.
In parallel with these two characteristics, there are two ways to
effectively and metrically measure P/M Fit.
1.
Churn Rate: Churn rate is a type of metric that expresses the
rate at which your gained users are regularly using your product.
This metric can be found by making a cohort analysis, the details of
which will be explained in the later chapters. According to Andrew
Chens theory, if your monthly churn rate is below 2%, you can assume
that you have achieved P/M Fit.
2.
You can also conduct a mini survey to find out about the level
of satisfaction that your users feel towards your product. If more
than 40% of your user base replies with very disappointed to the
question how would you feel if you could no longer use this product?,
then you can safely assume that you have achieved P/M Fit.
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4. Slack P/M Fit Research

Slack is a swiftly growing startup. Hiten Shah decided to see if P/M
Fit is achieved with his product, so he conducted a survey with Slack
users. 713 Slack users participated in the survey, and they came largely
from Twitter, as well as various other digital channels. Out of all the
questions, the three below are very intriguing and worth talking
about:
1. How would you feel if you could no longer use Slack?
A.
Very disappointed 51%
B.
Somewhat disappointed 39%
C.
Not disappointed, it really isnt that useful 10%
2. Have you ever recommended Slack to anyone?
A.
Yes, I have (%80)
B.
No, I have not (%20)
3. Top three answers to the question How did you discover Slack?
A.
Colleagues / friends (39%)
B.
Twitter (27%)
C.
Blog (17%)
The first question seems to be the most important one. It both
showcases how important the problem that the product resolves is
to the user, as well as showing how effective the product is at resolving
it. Speaking in terms of Slack, more than half of the users express
that they would be very disappointed if they could never use Slack
again. That goes to show that Slack solves an important problem for
users, and does so effectively.
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The second and third questions provide parallel insights to the first
one. Only users who like and are satisfied with a certain product would
make the effort to recommend it and share it. For Slack, the fact that
more than 80% of users have recommended it provides some very
big clues as to the level of interaction between the product and the
user. We find that the channels that see the highest level of participation
for the survey also reflect the degree of that sharing activity. Users
mostly visit from channels that we call referral channels.
B. Transition to Growth
The next stop after P/M Fit, is transition to growth. At this point,
you need to have resolved all your product related issues and should
be researching viable options to achieve active growth. For this phase,
we will be discussing the three growth engines that Eric Ries shares
with us in his book, Lean Startup.
1. Stick Growth Engine
The first of the three engines we will be discussing in this section
is the stick growth engine. Some products, due to the nature of the
problem they resolve, as well as their method of interaction, create
some sort of sticky dependence on their user base. While Gmail and
Evernote are focused on the end user, examples with a B2B focus are
more focused on this and they require a certain degree of technical
integration, which makes them ideal for this type of growth engine.
The biggest advantage to these types of products is the fact that they
retain their users for long periods of time.
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A startup is a company designed to grow fast.

Being newly founded does not in itself make a
company a startup.Nor is it necessary for a startup
to work on technology, or take venture funding, or
growth.Everything else we associate with startups
follows from growth.
Paul Graham
Tweet
With the stick growth engine, the entrepreneurs need to study how
much of the user base they are missing (which will be detailed in the
Retention chapter, with detailed churn rate information), and they
also need to have good knowledge of how many new users they have
gained in the same amount of time. As long as the number of users
gained trumps the number of users lost, the product keeps growing.
Since the users spend a large amount of time using the product, this
could provide some very useful opportunities in terms of gaining
new users.
2. Viral Growth Engine
Social products and content platforms are the most typical examples
of viral growth engines. The main mechanics of this growth engine
is based on reaching new users by using the existent user base. If the
average user is able to add one or multiple users to the existent base,
that starts the viral growth process. The growth rate depends on the
number of new users that are brought in by the existent users.
Users do not always share all the products they use. In order for a
product to grow virally, there needs to be an impressive experience
in it. While this experience might be the content itself, as in the case
of BuzzFeed and Upworthy, for a technical application, it might also
be the main features and performance of the application. For startups
looking to use viral growth engines, the viral coefficient for the
product/application in question needs to be carefully studied.
3. Paid Growth Engine
The most fundamental growth engine. A lot of SaaS applications
use this type of engine to reach a certain user segment. A large portion
of users can be reached by using search engines and targeted ads.
24
Startups that use this type of growth engine need to work very
diligently with alternative channels to get the optimum price for
adverts and user segments. Since the prices for advertising can vary
greatly due to the existence or constant inception of similar applications
in the market, the startups need to be working on alternative routes
to advertising, as well as ideas on how to gain new users.
To sum up, the main focus for startups after achieving P/M Fit
should be outlining a model for their growth. They need to model
their growth engine by carefully considering the type of product they
have, as well as the market dynamics. When we consider successful
products, we can identify three fundamental types of growth engines,
which answers the question What should we be paying attention to
when we are working on our product and our marketing strategy?
In the growth planning phase, the startups should test the
mechanisms in the said growth engines and choose the option that
can provide the most effective result. At the end of this phase, the
product will have proved the efficiency of the user acquisition process.
C. Growth
After proving the potential for growth exists through growth engines,
the next step is growth itself. This is where sustainable growth is
achieved through optimization. Sustainable growth involves two
main metrics. These are CAC (Customer Acquisition Cost) and LTV
(Life Time Value). Lets talk about these two metrics briefly:
CAC
No matter which growth engine you use, you need to work on user
acquisition. The costs that are directly or indirectly related to that
endeavor make up the customer acquisition cost. By calculating CAC,
you find out how much it costs to gain one single user.
For instance, if you gain 5.000 new users with a 1000 USD budget,
that means the overall cost to gain one single user is 0.2 USD.
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LTV
As your product gains new users, it will also inevitably lose some.
The time elapsed between gaining and losing a user is defined as the
lifespan. (To calculate lifespan, we use the churn rate. 1/churn rate,
is the lifespan rate).
The value that is directly or indirectly generated by the user during
the time they spend with the product is called the lifespan value. For
instance, the lifespan value of a SaaS product that works with a
monthly subscription model consists of the payments made by users
and the number of new users they bring in, it might consist of the
number of shares and clicks, and mailing list subscriptions for a
content site.
These CAC and LTV optimizations are critical for the growth process.
In order to achieve sustainable and profitable growth, the LTV/CAC
rate needs to be 3-4 minimum. That way, growth can be sustainable.
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CHAPTER III
DNA of Growth Process: AARRR
The term growth can be confusing for startups, since it has a broad
definition. When such startups interpret growth as increasing the
traffic for a specific website, and engage in attempts to do so, this can
often lead to problems. In order to achieve true growth, users lifespan
needs to be thoroughly reviewed and all the identified stages need to
be studies closely. The AARRR model, presented by Dave McClure, who
is the founder of 500Startups, can be a useful guide for growth here.
The AARRR model starts out from the initial moment you reach
users to the moment where revenue is generated and defines the user
lifespan with five stages, as presented below:
1.
Acquisition: How do we reach the target audience?
2.
Activation: How do we activate the gained visitors?
3.
Retention: How do we ensure that they come back?
4.
Referral: How can we reach new users via existent users?
5.
Revenue: How can we generate revenue from our users?
27
Lets talk about each of these questions in detail and see how they
can help the growth process:
1. Acquisition
The acquisitin phase sees us searching for answers to the question,
How do we reach the target audience? in detail. Since we will be
gaining the larger portion of our user base in this phase, the overall
quality and effectiveness of the actions taken in the acquisition phase
impact the rest of the process as a whole, up to the revenue phase.
As previously mentioned in the former chapters, the main focus in
the acquisition phase is not gaining (free & organic) traffic. The main
focus in this phase is to reach the target audience by using digital
and non-digital channels and to generate awareness. In order to have
a healthy and high performance acquisition phase, there are some
fundamental concepts that need to be talked about. By talking about
them in detail, we can have a better understanding of the growth
phase.
A. Value Proposition and Persona
Throughout the whole writing process, this chapter was the most
challenging one for me. That is because value proposition is a concept
that has been the topic of whole books, and is considered to be the
core of marketing. In this book, however, I tried to explain the whole
process in a way that would be suitable to the needs of beginners and
new entrepreneurs, making it easier for them to take action.
Value proposition, in the simplest terms, is the proposition that a
company makes to its (potential) customers in regards to the benefits
and value they can garner from its products and services. Setting
aside the digital world and startups, all the companies and startups
in the real world offer a value proposition that pertains to their overall
business strategy.
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When considering the acquisition phase, the concept of value

proposition that we are talking about differs fundamentally to the
mission statements that these companies usually present. In the
acquisition phase, we talk about the type of value proposition we are
going to present to our potential customers. In that regard, when we
present the value proposition, it should both generate interest and
motivation, as well as clearly outlining the specific problem that our
product aims to resolve, and how/why it differs from other solutions.
In order to ensure that the value proposition has the desired effect
on the target audience, we need to analyze the target audience
thoroughly. We should be able to answer important questions such
as: What makes them happy or unhappy? What are their sources of
information? Who do they trust? What motivates them? What are
their behavioural tendencies in the digital world?
Personas are helpful in being able to answer these questions they
are imaginary person(s), stereotypes if you will, that we create in
order to grasp a better understanding of the target audience.
In reference to our previous example, lets assume that we have a
product that enables users to create their own websites, and lets also
assume that small and medium sized businesses are an integral part
of our target audience. And in order to forge a strong bond with your
target audience, you have come up with a person named John.
Afterwards, in your interviews with these business owners and your
observations, you will have enough information to shape your first
persona, based on the problems, motivators and decision-making
processes of the average small and medium sized business owner(s).
Fundamental Suggestions to Generate Value Proposition
The initial interaction that any potential customer has with a given
product is through the proposition value. If your proposition value
fails, you do not get another chance at acquiring the customer.
29
That is why the content your value proposition is an important

issue for the success of your venture as a whole.
Especially new startups need to conduct long tests and thorough
research, and work on improving the proposition at length. We will
now talk about some fundamental suggestions, as well as discussing
common pitfalls to avoid:
a.
Refrain from technical details: In preparing your value
proposition, try to avoid talking about the technical details of your
product or service. Your focus should be on the value that is generated
by the service or product for the user, rather than defining it or talking
about it.
b.
Take advantage of the problem: What is the problem you
aim to resolve for your target audience? When you are preparing your
value proposition, you need to benefit from the problem as much as
possible. Explain to your target audience how their problems will be
solved after using your product, and help them envision the life they
will lead with that problem gone.
c.
Use short, to-the-point texts: Your value proposition should
not be too long. You should be able to summarize the whole value
proposition in a single sentence, if possible. The words you choose
should sound familiar to your target audience, and should ve simple
enough to understand.
d.
Choose words with an emotional feel: Your value proposition
should motivate the users to take action. In order to do so, your choice
of words should be emotional.
e.
Create an atmosphere of urgency: How valuable is the problem
you are resolving to the customer? Can you measure the cost or damage
to the customer if the problem remains unresolved? Try to touch upon
these subjects to create a sense of urgency in your value proposition.
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B. Channel Analysis
Social networks, search engines and PR activities can each be
regarded as a channel. When it comes to acquiring new users, these
channels spring to mind, along with the question what can we do
using these channels? at length. It should be noted that before working
on these channels, the startups should first and foremost work on
the value proposition, along with the personas to successfully acquire
users.
When we are outlining the personas, one of the main topics that
should be researched is the types of channels that the target audience
prefers in the digital world. In planning the activities for acquisition,
the activities should be planned around the digital channels that the
target audience actively uses. The important decision here, however,
is which channels are to be the focus, and which will be on the
backburner. Startups that conduct a detailed channel analysis will
be provided with adequate data to answer those questions.
You can download a matrix template from here:

http://bit.ly/ChannelSampleTemplate
In reviewing the channels, thing can be simplified by using a basic

matrix. There are six main parameters that need to be considered for
each channel:
a. Cost: How much does it cost to work through this channel?
All the direct and indirect costs need to be included here.
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b. Targeting: How much targeting can be done via this channel?

Is the desired amount of detailed targeting achievable through this
channel?
c. Control: How much control do we have over the channel? If
you are able to stop an underperforming advert, that means you have
higher control. In PR activities, you cannot stop the activity if something
goes wrong, which is why you have lower control.
d.
Prep Time: How much preparation is needed to start working
on this channel? Some channels allow for instant starts, whereas
some channels require a longer time period to get started.
e.
Testing Period: When will you get the initial feedback over
the desired channel? Are short term results directly available, or do
you need to work for long term results?
f. Scale: How large is the target audience that you can reach via
this channel? Can this channel be used for long-term user acquisition,
or is it more suitable for short term work?
By reviewing all the chosen channels with these six parameters,
and classify them as low, middle and high.
The matrix that you will create as a result of this research can help
you determine which channel(s) you need to work on, keeping in mind
the resources and needs of your venture.
Customer Acquisition in The Digital World
When you are planning what needs to be done in the acquisition
stage, you should also consider how the digital world functions in
user acquisition. Startups work on various channels and sometimes
conduct analyses prematurely on them, and which can lead to
erroneous data and missteps in the acquisition process later on.
Googles research titled The Customer Journey to Online Purchase
is an ideal resource that provides us with some very important data
in regards to the journey of customer acquisition. It features a detailed
and variable ranking of resources and listings depending on the sector,
country of origino and the size of the company in question.
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You can develop your own channel related forecasts by studying

the customer acquisition channels using analysis tools. But if the
channels that you are studying are the end-user channels, that attempt
might prove to be a misstep. User acquisition does not happen through
a single channel or a single interaction. In order to acquire a user,
there needs to be multiple points of contact and repeated engagement
with that said user.
The Attribution Model presented by Google Analytics enables you
to see and review all the possible channels for user acquisition. http://
bit.ly/OPAttributionModeling
The main idea that needs to be understood here is that generalizing
statements such as channel X works, channel Y does not should be
avoided at all costs. In order to be successful in user acquisition, you
need to consider where your target audience is, and how you can
reach them, rather than directly consider what you can do with each
channel that is available to you.
Global Examples
Acquisition is something that grows systematically and in an ordered
fashion around a target audience. In doing acquisition work, you
constantly need to be on the lookout for different solutions and
approaches, and try to discover new tactics to bring the target audience
and the product together. In this chapter, we will be talking about
applications that managed to accelerate their acquisition process by
using the right tactics, as well as the main ideas behind their tactics
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It is worth noting that following a copy-paste approach and trying

to implement their tactics to your startup directly will not yield results.
In order to be successful, you need to discover the mechanism that
lies within these tactics and to consider how they can benefit your
product and your target audience overall.
1. Pinterest - Open Graph
Pinterest, was one of the first applications to utilise Facebooks Open

Graph technology. This enabled users to share their Pinterest activities
on their Facebook profiles with messages and visuals. That way,
Pinterest managed to display the activities of their users to their
respective Facebook audiences. Therefore a whole new audience
unaware of Pinterest found out about it.
Before you start working with Open Graph, however, you should
carefully consider your product and its properties, and how effective
it would be. What type of activities does your target audience choose
to share on Facebook? By using Open Graph Stories, you can fetch
your target audiences activities with your product and get them to
share the activities on Facebook, therefore attracting a whole new
user base to your product.
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2. Airbnb Integrations
The Airbnb Craglist integration was regarded as a growth hacking

example due to the technical difficulties that came along with it. With
technical improvements, Airbnb had its ads show up on Craigslist
automatically. This was highly effective in generating awareness
among users about Airbnb as a marketplace.
There are two main points to be taken away from this example.
Airbnb did not just integrate itself into all the platforms that would
provide it with randomized seeding. It needed more buyers for the
marketplace that it created for itself. Since the user profile for
Craigslist overlapped that of Airbnbs almost completely, this was a
thoroughly successful endeavour.
Another point is building long-term relationships and mutual trust
for sustainable growth. When working on such platforms, you should
never be too enamoured with the glamour of the hacking part, and
engage your startup in activities that might be deeemed unethical or
illegal. We previously touched upon this subject at the beginning of
the book, when we discussed the topic of software piracy and the term
hacking, and how they are unrelated in this context.
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3. Upworthy - Social Media Optimization
Upworthy is a popular platform with viral content. Due to the fact

that their content has a very high share rate, this poses a very big
opportunity for Upworthy. When the links are shared on a social
media platform, special images and content is available for that
specific platform, therefore making them more attention grabbing.
You should pay special attention to how your content pages can be
displayed on social media. You need to design your content pages
with consideration to how they will be displayed on social media.
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4. MailChart - Value Added Services
MailChart is an e-mail marketing application. They have a newsletter

ideas section, which they use to display different newsletter designs
that they like. Therefore they create an organic section for that
important initial user interaction by putting the kind of content needed
by the potential users in their own platform.
The meeting point for the problem that your target audience is
experiencing and the resolution provided for it by your product is
where your opportunities lie. The calculators and mini tools you will
be coming up with at this point can constitute a viable channel for
user acquisition in the long term.
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5. HubSpot - SEM & Special Landing Pages
HubSpot offers various tools targeted at digital marketing experts.

By using special landing pages for each of its products, it utilizes the
traffic it receives from channels such as Google Adwords far more
effectively, and manages to convince the users that it attracts
organically with content that is directly relevant to their interests.
Before being engaged in keyword oriented practises such as Google
Adwords, you should carefully consider your product, target audience
and the right keywords needed to attract them. If you choose the right
keywords, you will receive high performance value, even if your ad
volume is low. If you feel you do not have the adequate know-how or
experience, I highly recommend working with a certified expert.
It is important to follow through the user lifespan. Special landing
pages for users arriving via ads can be quite beneficial. In order to
discover the dynamics of preparing a landing page, feel free to take
a look at the chapter about activation.
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6. Instagram Sharing
Instagram is a social network where you can share photos and videos.
It optimised the traffic it receives by using Facebook and Twitter for
shares. When you click on an Instagram photo, the messages and app
download links that are displayed with the content itself contributed
to the conversion of content consumers to content producers on the
platform in the long run.
Where do you come into contact with your target audience the most?
Stop waiting for the users to visit your homepage to talk about your
product and get them to take action. You can use any point of contact
as an opportunity for user acquisition.
7. KISSmetrics Content Generation
KISSmetrics is an analysis tool for digital marketing experts. With
the content that they prepare, they not only cover the areas of interest
for their product and the issues it focuses on, but also any other issues
that their potential customers might need support for. They generate
content with blog posts and webinars and by doing so, manage to
reach out to a significant portion of their target audience organically.
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You need to consider content generation as a professional activities.

Try to prepare the kind of content that will generate value for your
users, as well as avoiding copy-paste and bland type content.
8. Scorp - Viral Content
Scorp is a mobile application that
garners great attention in Turkey.
Users can shoot short videos on any
topic within the app and share it. As
it targets the young, the topics that
are displayed in app are mostly
attention grabbing. The videos that
gather under a specific topic can later
be put together and displayed on
platforms such as Facebook. Since the
content and topic is highly relevant
to the target audience and the
platform, this generates a high level
momentum.
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If you share engaging, interesting and fun content on the right

platforms, you will see effective results. To do so, you need to analyze
your product and the motivations of your target audience correctly.
2. Activation
After the acquisition phase, comes the activation phase. At this
point, we have managed to reach out to potential users via a variety
of channels. The activation phase, however, is where we turn our
potential target audience into active users of our product, step by
step.
The activation phase can differ depending on the product, the needs
and the working principles at hand. In this section, we will be talking
about how the activation process operates for a general type of product,
as well as what can be done in each step. When we consider the
activation process as a whole, we can identify two main stages (two
main stages of transformation). Lets take a look at these for the sake
of making the correct definitions:
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First, by using various channels, we attract potential users to the

site. At this stage, the main motivation is to convince the visitors to
try the product, and get them to sign up for the site. When users arrive
at the landing page, a conversion process takes place and a portion
of those visitors become members. Landing pages, then, are a tool
worth utilizing at this point, and are an important metric in visitorto-member conversion.
The activation process does not solely consist of turning visitors
into members. The gained members also need to become active users.
In order to activate these members, we need to help them experience
the value provided by the product. This is where the onboarding
processes come into play. Lets take a look:
Important note: Members and users are two fundamentally different
concepts. Not all members are active users. When we say users, we
refer to the group of people who actively interact with the main
features of the product in question.
A. Landing Pages
1.
Value proposition
2.
Product information
3.
Visual Components
4.
Trust-building components
5. Call-to-Action
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At the end of the acquisition activities conducted on both online

and offline channels, the users need to be greeted with a certain type
of page. This is called a landing page, where you inform them about
your product and get them to take action. The main motivation of
landing pages is to inform the users about the product in question
and get them motivated enough to sign up. Depending on the needs
of the target audience and the product, the main principles that need
to be adhered to can vary greatly. In this section, we will be talking
about the general outlines of creating a landing page.
The 5 fundamental components of a landing page are as follows:
1. Value Proposition: We previously talked about value proposition
in the acquisition stage. On landing pages, the value proposition needs
to be mentioned in order to convince the users. The first thing that
one needs to see on a landing page is the value proposition of the
product. There can be specific landing pages with different value
propositions, depending on the campaign in question and the needs
of the target audience.
2. Product Information: In order to get our visitors to take action,
certain explanations and directions are needed. The landing pages
need to answer questions about the product such as What are the
benefits? How does it work? How can I use it? and so on.
3. Visual Components: Landing pages need special visual components
in order to perform better. Videos are among the most powerful
examples. Customer reviews from people who have used the product
are also helpful in convincing the users. Using videos can be a powerful
way of easily and effectively conveying the benefits and function of
the product.
4. Trust-building Components: The testimonials of people who
have used the product are especially potent in building trust between
potential users and the product. Testimonials should be as specific
as possible and the comments and reviews should be managed and
curated by people with similar profiles to the target audience.
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5. Call-to-Action: Every landing page features a fundamental action

that needs to be taken. This can be an essential action, such as signup, or a secondary one, such as download the e-book or sign up
for our mailing list. Visual design should highlight the desired action
that needs to be taken. In measuring the page performance, the
essential action is the main parameter.
EXAMPLE : Invision App Landing Page Review
Invision is a product that enables product managers, project

managers, designers and developers to work on the same platform
when they are working on a product. They have a very impressive
landing page. In this section, we will be reviewing their landing pages
and see how the previously mentioned elements can be used in a
landing page.
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When we look at the landing page for the first time, we see three
main components. The first thing that grabs the attention is the value
proposition, which reads as: DESIGN BETTER. FASTER. TOGETHER.
Right below the value proposition, we see a supportive description:
The Worlds Leading Prototyping, Collaboration & Workflow Platform.
Below the value proposition and description, we see the call-to-action
text: GET STARTED - FREE FOREVER. Adding the phrase FREE
FOREVER above the call-to-action section is a brilliant idea. This
effectively answers the question how much is it? that might pop-up
in the minds of potential users before they take the step to sign up,
by informing them right before the call-to-action area, which directs
their attention to the action itself.
The third components is the video. We are shown examples from
MailChimp to Netflix and informed as to how much they benefit from
using Invision. Since the video is discussed in detail in the other parts
of the site, the landing page keeps things brief and to-the-point.
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In browsing the rest of the site, we come across pages with similar
structures. Each page details a product feature with relevant imagery.
The visuals display how the feature operates and the text provides
brief and explanatory details about the product. This is all supported
with the addition of mini testimonials.
These sections inform the visitors about the benefits of Invision.
The main and essential features of the product are outlined. There
are no unnecessary details. By describing each feature with a single
page, the visitors are able to focus on each feature independently
As we continue, we come across detailed customer testimonials.

The people featured in the video are shown with the logos of the
companies they work with. The video content is focused on the
experiences of Invision users with different titles and roles and how
they benefit from it, as well as generating value. This helps build trust
between the users and the product, as well as creating expectations
about the benefits that the product can provide them.
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As we continue to the end, we come across the various logos of the

brands that use Invision, which helps build the globally powerful
image of Invision. Users are shown another call-to-action section at
the end. If you are doing something similar, make sure the call-toaction text includes socially valid proof.
What Can We Learn From Invisions Landing Page?
1
The contents of an ideal landing page should consist of user
oriented content. Instead of describing its features from its own point
of view, Invision has chosen to put the user experience and the
generated value at the forefront, therefore creating a landing page
that is focused on the consumer.
2
Visuals are vital for landing pages. The main motivation in a
landing page should be to convince a visitor who has no information
about our product to try it out and use it. In that regard, visuals are
very convincing.
3
Landing pages should focus on only the most essential features
of the product. Technical details and other details that do not
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necessarily generate motivation should be excluded so as not to

disrupt the visitors focus.
4
The main action that needs to be taken on the landing page
should be fairly obvious. The user should not be distracted with
additiona actions. When we consider Invision, we see a single action
on the landing page, and the users are directed to it only.
5
User testimonials are vital for landing pages. With the positive
commentary provided by the brands and customers that are satisfied
youre your product, your landing page becomes much more
convincing.
In creating your landing page, you should refrain from turning it
into technical site. All the messages, visuals and other components
on your page should be prepared with the aim of convincing the
visitors. Various types of landing pages can be prepared, depending
on the dynamics of the product and the visitor. That is why there is
not a pre-determined to-do list for creating landing pages. You should
create your page depending on your product and target audience and
should aim to increase the performance of your page by testing
different approaches as much as you can, as often as you can.
B. How Is A/B Testing Performed?
The adjustments made to the messages and page scenarios in landing
pages can increase performance dramatically. In order to improve
the performance of landing pages, A/B testing has proven to be a very
effective tool in detecting what sort of message and page scenario
would yield high performance for your venture.
The changes thought to be beneficial for the performance of your
landing page are presented to two different groups from your audience.
The behaviour exhibited by them upon being presented with these
messages and page scenarios helps you to evaluate which one works
best and provides better performance.
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But how does an effective A/B testing process play out? Is it enough
to use a tool like Optimizely on its own for a healthy A/B testing
process?
The A/B testing process consists of five fundamental stages. The

first one is discovering the problem. The problems can be optimizational,
such as the right button colour, or the size of the call-to-action area,
or more fundamental, such as the value proposition, or the key visual
that is used. If the page is underperforming, the problems that should
be focused on should be the value proposition, page flow and the
visuals. Optimizational issues such as the right button colour, or the
size of the call-to-action area are classified as performance enhancing
issues.
After the problem discovery phase, comes the research phase. This
is where you should gather all the data and forecasts relevant to the
problem at hand. The resources that should be gathered at this point
can consist of the data received from the product itself or various
tools of analysis, behavioural data gathered through observing the
user base, as well as successful global examples.
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The hardest thing in marketing is EARNING

attention and trust.
Dan Martell
Tweet
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After completing the research phase, comes the hypothesis phase.

In this phase, the data gathered during research is turned into a
hypothesis that will provide the solution to the problem at hand. At
this point, a value proposition should begin to take form, with a general
outline, such as: Our value proposition should be X instead of Y,
because according to our research, Z is not .
After hypothesis, comes testing. This is where the A/B testing tools
are used, where we can begin to test our hypothesis by forming
different groups among the user base. The hypothesis can be tested
using any one of the tools.
At the end of testing, the findings as to whether the hypothesis is
valid or not can be received. In reviewing the test results, you should
carefully consider how relevant the results have been to the whole
testing process. While small adjustments made at the end of
optimization tests, the discovery test results should directly line-up
with the main hypothesis, in order for it to be considered valid. If the
test results are successful, the necessary changes are made and a new
problem can be considered. If the test results are not successful, the
hypothesis should be reconsidered and reformed, and the tests should
be repeated.
A/B Testing Examples
There are various types of famous A/B testing scenarios across the
globe. In this section, we will be talking about some notable examples
that can be used as inspiration:
1. Unbounce:
Unbounce is a tool that allows you to create landing pages. In order
to increase the number of free subcribers they have, they did some
A/B testing with their call-to-action texts. When they used the phrase
Start your free 30 day trial instead of Start my free 30 day trial,
they noticed that the page performance increased by 90%.
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2. Simcity
Simcity is a video game produced by EA Games. On their buy now
page, there is a section detailing that people who pre-order the game
will be given a $20 discount for the next time they shop from there.
According to the A/B testing, where they removed that phrase,
therefore eliminating the discount feeling, they noticed a sales
increase of 43.4%.
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3. Kaya Skin Clinic

Kaya Skin Clinic is a brand providing skincare services. They
conducted some A/B testing to increase the number of leads from
their site (internet site ziyaretisi artrmak deil, internet sitesinden
gelen leadleri artrmak iin diyelim). During the testing phase, they
changed the phrase on the request form from For Skin Consultation,
Register Here to I want an expert opinion, Sign me up! . When they
received the results, they saw a staggering improvement of 137% in
the number of leads.
Remember that A/B testing is fundamentally important for your

product and target audience and you should have a clear opinion of
what you need to be testing in order to be successful. In that regard,
A/B testing is not only a tool that allows you to test randomized
changes, but also a valuable way of testing the product development
processes and any ideas you may develop in relation to your product
as a whole.
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C. Onboarding Process
The second part of the activation phase is adapting new users to the
product.
In order to accelerate the adaptation process and to improve
performance, certain orientation procedures need to be devised and
followed. This called the onboarding process. From the first tour a
visitor takes of the application, to e-mailing, all the activities performed
to activate a given user are part of this process.
The first step in designing the onboarding process is trying to make
out what the initial experience of a new user with the product is like.
By benefiting from the value proposition, we can outline the main
points of contact that need to be established between the user and
the product. For instance, the initial experience of a given user with
Twitter would be to follow friends and accounts they are interested
in, whereas the first thing you can do with MailChimp would be to
upload your contact list and conduct your first e-mailing activity.
After outlining the initial experiences that you want for your users,
you should design a tour of the product by putting them in order of
importance. This should be a process that is directly supported with
the help of visuals and messages, so that the user can go through it
smoothly and take the necessary actions.
After designing the greeting phase for the users, we can move on
to measuring and optimization. The main metric in the onboarding
process is the extent to which the users initial experience matches
the desired experience overall. The users ability to adapt to the product
should be optimized by adjusting the visuals and texts, as well as the
overall flow.
Example: Pinterest Onboarding Review
Pinterest, is a social network mainly composed of visual content.
There are two factors that impact end-user experience for Pinterest.
They consist of reaching interesting content and seeing what your
friends share on the site.
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During the greeting process, Pinterest directs the attention of its

user base to those two main features and ensures that the users go
through a successful initial experience. Lets take a look at that process.
Pinterest uses different visuals on its sign-up page. When you refresh
the page, you are greeted with a different visual and a different text.
The texts are prepared as value propositions themselves, and they
relate the stories of the users. That is what makes them convincing.
When you look at the sign-up section, you see that you are given
the option to sign up using Facebook. We see that the choice of words
here is Continue with Facebook. That eliminates the concept of a
cognitive cost that is usually implied with words such as Sign up
or Register.
Users who do not want to use Facebook at this stage can sign up
with their e-mail adresses. They choose the e-mail address and
password they like, and if the page reloads, the e-mail field is auto
completed.
Lets choose the e-mail option and sign-up.
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The next page requires detailed membership information. The visual

remains the same, but the page title is changed to Last Step!. Users
are asked for their name, surname, age and gender here. Lets fill
them in and continue.
Pinterest asks for notification permissions in the next step. Mac

users can approve of these notifications and if they are using Safari
to browse the site, they can receive special notifications. That is how
Pinterest receives notification permissions from the users and created
a channel through which it can attract users time and again.
As we continue, we are greeted with a page that inquires about our
interests.
Pinterest is a platform that revolves around the visual world. In

order to provide the users with a rich experience, it needs to make
sure the content that it serves is relevant.
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Therefore, it first tries to find out about the interests of its users
and then curates the content according to the choices made. The
categories to choose from are listed with titles and visuals on the
pages.
Upon choosing interests, we are greeted with the text Great! on
the upper left side of the page. Pinterest provides feedback to the user
after every action. That is important, because it helps the user to think
the actions they take are correct, and encourages them to continue.
The next section is who to follow , because one of the most vital
resources that will increase the level of interaction between the user
and Pinterest is friends. This page encourages you to find your friends
on Pinterest.
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There was not a skip action while choosing interests. However,

the friend finding section allows that. Users who do not want to
authorize Pinterest to gather information from their Facebook or
Twitter accounts can choose to skip this stage. You are greeted with
a message when you choose to skip it, which uses an emotional tone
while informing you on what you will be missing out on if you do
not follow your friends. It is also worth noting that the initial option
on this message is Go Back. The main idea is to make sure the user
takes as many actions as possible.
We are now in the final stage. This is the part where you are reminded
that you can install the Pinterest browser add-on to easily pin any
visuals you come across on the web to your Pinterest board. Since this
browser add-on makes it easier to generate content, asking the users
if they would like to install it is a fairly logical move.
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You can also skip installing the add-on. When you do so, you are
greeted with a warning that is similar to the one you get when you
skip the friends section.
After that phase, we are finally able to use Pinterest. Normally, you
would need to confirm your e-mail address to be able to use Pinterest
actively. When you are initally logged in to Pinterest, you are given
a notification to confirm your e-mails address, which prevents the
e-mail confirmation from hindering the greeting process. Lets take
a look at the e-mail we receive. This is a brief e-mail confirmation
screen. The e-mail makes the necessary connections to mobile
applications, which are important channels themselves in continuing
contact with the user.
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Upon clicking and confirming the e-mail address, we are greeted

with a light-box, directing us to download the mobile application.
This is where the Pinterest onboarding process is finished.
What is the main approach featured throughout the process? The

product itself highlights the idea value generation and important
points. All the text and redirection points are optimized with the idea
of increasing the benefits the users can gain from using Pinterest.
When a new user arrives, they get the optimum value adding Pinterest
experience by going through some very simple steps.
All the text and redirections should touch upon these value points.
In doing so, your overall message flow and directions should be as
simple as possible, and the percentage of users who successfully
complete this stage should be taken as an important metric in itself.
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3. Retention
After the acquisition and activation phases, we can move on to the
retention phase. Here our main objective is to ensure that the acquired
and activated users keep coming back to use the product. The longer
a user is occupied with the product, the more our growth performance
increases. In order to measure retention and to understand the extent
of its contribution to the growth of our venture, lets now talk about
cohort analysis, which is a widely used method of analysis:
Churn Rate and Cohort Analysis
Churn rate, is a metric that displays how many users (customers)
leave the product. For many startups, keeping a close watch on the
monthly churn rates provides the necessary insight to decide if the
venture itself is on the right track or not.
You can determine the churn rate of your product by using cohort
anaylsis. Churn rate is important due to two reasons.
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First, it provides you with a general idea about your P/M Fit. If an
important portion of your user base abandons your product after
first use, this means that you need to make some fundamental changes
and perhaps reevaluate your startup as a whole.
The second reason is that it is a very beneficial parameter in
determining the acquisition performance of your product. If you only
consider traffic and the number of new users in user acquisition,
this is a misstep, as these two metrics can be dangerous and can easily
deceive you regarding the growth performance of your product. In
order to achieve a healthy growth process, you need to consider the
quality of the users you gain, as well as whether they are the right
kind of users for your product. Churn rate is a very beneficial metric
in achieving that. You can review the performance of your acquisition
activities by comparing your weekly and monthy churn rates against
the tests you perform on the channels you are using.
There are various ways to conduct a cohort analysis. Google Analytics
and Mix Panel are tools which provide you with direct cohort analysis
reports, you can also use special cohort analysis formulas to make
specific calculations. Especially for SaaS startups, Christoph Janzs
cohort analysis table can also be very beneficial.
Hook Model
By using cohort analysis, you can measure how dependable your
user base is on your product. But this does not present a solution in
terms of reactivating your users and attracting them to the product.
Nir Eyals Hook Model outlines the mechanisms behind the products
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that form a certain dependence in their users. By using this model,

you can work effectively on reactivating your users.
When we inspect the Hook Model, we find that it consists of four

sections, namely trigger, action, variable reward and investment.
Lets take a look at these in detail.
Trigger
We can define triggers as initiators of action. According to the Hook
model, there are two types of triggers, namely internal triggers and
external triggers. External triggers are used in order to encourage
repetitive action in the users. E-mails, notifications and ads can be
defined as external triggers. Internal triggers consist of the motivations
that form in the minds of the users without any external intervention.
When you feel lonely, you check Facebook, when you feel bored,
you check Twitter: both of these behaviours take place due to internal
triggers, which, in this case are boredom and loneliness.
In order to form internal triggers in a user, you first need to utilize
external ones effectively. You should analyze all the bonds that can
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be formed between your product and the users, and try to turn every
opportunity into an external trigger.
Action
When you create motivation with triggers, your users take their
first action.
There are two things you should pay attention to at this point: You
should set your triggers up in such a way that they will yield maximum
motivation, and the actions should be performed with very easy and
smooth transitions.
Variable Reward
If you aim to form a dependence in the user base and turn their
visits into frequent and natural actions, you should be presenting
them with variable rewards at the end of each action. Lets continue
with our previous example. Most of us often go on Twitter when we
are bored. If Twitter fails to provide us with new content each time,
then it is not possible to turn that behaviour into a habit, a dependency.
You need to provide your user base with surprises in relation to the
value you are proposing to them for dependency. In planning the
product and the actions around it, make sure that the rewards you
provide are satisfactory and interesting.
Invesment
The investment phase is the last phase of the hook model. By getting
our users to take action via a trigger, we moved on to reward and
satisfy them as a result of their action. Now, in the investment phase,
we can expect user contribution. Continuing with the Twitter example,
lets say the user came to Twitter and found a reward, such as content
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that is relevant to their interests. When the user interacts with

these (such as retweeing, replying or adding to favourites), they
perform an investment in your content. Therefore, the contribution
of a user in the investment phase can, in return, be a trigger or reward
for other users. When designing your product scenario, the channels
through which your users can contribute should be laid out for them.
Examples
In this section, we will be discussing some global examples on
retention.
1. Medium Update E-Mails
Medium, sends weekly e-mails to their users, with shorter texts than
the actual content it features. If a particular article is interesting, you
can click on it to be redirected to the necessary link.
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The weekly update e-mails sent by Quora and YouTube can also be
classified as such. These update e-mails are curated according to the
accounts followed by the user, as well as their interests and previous
history on the product, and are presented in an engaging and
interesting way, therefore making it possible for them to revisit.
2. Academia.edu - Alerts
If someone on Academia.edu has found your profile via a Google
search, it uses it as an opportunity for e-mailing. You receive an e-mail
stating that your user profile has been viewed.
These e-mails are referred to as alert e-mails. When you send an

e-mail about the changes, updates and news related to the presence
of that user on your product, this acts as a viable excuse to reactivate
that user. If the message sounds personal and involves actions directly
related to the user, it yields a high retention rate.
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3. LinkedIn Important Updates

LinkedIn is a product that effectively utilizes e-mail communication.
Every year, it turns the milestones it has hit into opportunities for
communication. In their latest activity, LinkedIn managed to reach
1 million content and upon e-mailing their users about it, encouraged
them to create more content.
Try to create personal milestones for your users within your product.
When they hit that milestone, you will have an excuse for
communication, and will be able to direct them to a particular action.
4. Mobile Notifications
Mobile applications are very effective in keeping users active with
notifications. Lets take a look at some of these examples:
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When the people you follow on Twitter begin talking about a

particular topic, you are sent a notification. This is a very strong
scenario for a platform that you use to stay up to date on whats
happening, because it gives you information on what your friends
are talking about.
Shazam is an application that helps you discover the names and

artist information of a track that is playing. It curates special content
and sends notifications to their users on a regular basis. It also curates
its content and personalizes it according to the users location.
Quizup is a pop quiz application. It utilizes the main motivation of

its users and sends notifications with a challenging tone, therefore
directing you to play more.
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Foursquare is an application that allows you to discover new places.

The content that is generated about the venues is extremely important
to them. By personalizing their notification texts, Foursquare motions
you to create your own content.
As previously mentioned in the chapter about Acquisition, Instagram

is a platform where you can share photos and videos with your friends.
You get notifications about the content you share, as well as receiving
eye-catching notifications when a friend of yours on a different social
network you provided authorization to joins Instagram, or shares
their first photo there.
To sum up this part briefly, your retention performance is crucial
for the growth of your venture. Niral Eyals Hook Model is an effective
method to create a dependence and habit in your user base. The hook
model has a four stage plan to make sure your users visit and revisit
the product and form a long term dependency on it. Remember that
every meaningful trigger is helpful in boosting your retention
performance, with e-mails and mobile notifications being major
helpers.
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4. Referrals
When we are talking about growth hacking, Hotmails story of growth
is one worth mentioning. After their initial success, the marketing
team at Hotmail followed different strategies for growth and found
the answer by adding the note P.S. I love you. Get your email at
Hotmail at the end of each e-mail. When we review their growth
process, we see that Hotmail utilized their viral growth engine in
combination with referral processes in a very effective manner. But
what is the secret to a successful referral? How can new startups use
referrals to their benefit? In this section, we will be talking about how
important referrals are for the growth process and the vital points
for a successful referral, as well as globally succesful referral stories.
Why Are Referrals Important?
Lets talk about the research results first: a user that is brought in
by a referral tends to be more loyal than a regular user and generates
higher value for the company. That is why, instead of gaining regular
users through regular channels, you should be regarding referral
users with more attention.
Another point that makes referrals precious is that the referral flow
forms itself according to the level of satisfaction among users, as well
as the P/M Fit. Users will only refer their friends to a product if they
are happy with it. If your product is not actively shared online or
offline, or there are no referrals for it, that might indicate that there
is something wrong with your product. If that is the case, you should
reevaluate it to increase customer satisfaction.
What makes referrals important is the fact that they lower acquisition
costs. When you start gaining new users thanks to referrals, your
overall user acquisition costs go down significantly. While you reach
your target audience, you also manage to do so in a cost effective way.
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The Foundation of a Successful Referral: Invitation Motivation

Fred Reichheld is a business strategist who works on the concept of
loyalty. After his work with Bain & Company in 2003, he came up with
the concept of Net Promoter Score or NPS for short, which is used to
measure the loyalty of a companys customer base. To try NPS, all you
need to ask your users is the question How likely is it that you would
recommend our company to a friend or colleague? and ask them to
answer with a number ranging from 0 to 10. You can easily calculate
your NPS number by using tools such as Survey Monkey.
Users who reply with a score of 9 or 10 are loyal ones. (Theoretically
they are called promoters.) They are the customers who are likely to
share your product and tell their friends about it. Those with scores
of 7 and 8 are passive users. They are not very open to the idea of
sharing the product with their friends, but if they see motivating
results with it, they are more likely to start inviting. Those who reply
with scores ranging from 6 to 0 are the unhappy bunch. They are the
least likely ones to share your product and tell their friends about it.
When the NPS score is being calculated, the promoters (those with
scores of 9 and 10) and the unhappy users (ones with scores between
0 and 6) are the reference points. If all the surveyed users have replied
with 9 or 10, the NPS score is 100, if they all replied with a score
between 0 and 6 the NPS score is -100. Therefore, if your NPS score
is above 0, this is a good point to start using a referral program. If its
50 or above, this means you are at a very good point in terms of possible
referral success.
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Growth hacking is a process, not a secret book

of ideas.Growth strategies cannot be easily copied
and pasted from product.Growth is
never instantaneous.It is never overnight.It is a
mindset at wich you approach problems.
Aaron Ginn
Tweet
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If the NPS score is low, you need to work on your user experience.
They need to be motivated to share your product. Products that directly
solve problems or offer an interesting experience can do this with
themselves alone, whereas for some startups, campaigns can provide
a good boost to the growth process. If your users have a low referral
rate, you need to reevaluate your product and the experience it provides
to the users. If you feel that your experience is issue free, then you
must consider new scenarios that will generate more motivation.
Hotmail Referral Review

We can now talk more in detail about the growth process of Hotmail.
Sabeer Bhatia and Jack Smith wanted to establish a company of their
own, but they also did not want their employers to read their e-mails,
where they were making plans about it. So they developed the first
web based e-mail application, which marked the birth of Hotmail, in
1996. They initially tried to gain users by using radio and outdoor ads
as well as other channels by a $300.000 investment made in the
beginning, but failed to do so. Then, after changing the signature of
all Hotmail correspondences to P.S I love you. Get your email at
Hotmail, they kickstarted their growth strategy and reached 30.000
users in one day, and 1.000.000 users in a month.
By adding that phrase to every e-mail sent out by them, Hotmail
turned all of their users into promoters. Anybody they e-mailed
within the system became aware of Hotmail by referral, but in order
to correctly evaluate the reason behind this rapid growth, we need to
consider both the givers and the receivers of the referrals in question.
Hotmail was the first web based e-mail application in that time.
The your e-mail section was, therefore, a very exciting, new and
different thing for the users who saw it for the first time in 1996.
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(As previously stated, the whole reason why Hotmail came around
was that its founders did not want their employers to read their
e-mails). The value proposition created motivation in the target
audience, which yielded rapid growth.
A lot of applications follow in the footsteps of Hotmail and add the
same type of messages to their content in the beginning, but they are
not very successful. That is because that type of value proposition no
longer holds the same meaning for the users. An important thing to
remember at this point is that we can hack channels, messages and
distribution during the growth process, but we cannot hack people,
values or motivation.
Dropbox Referral Flow
Before Dropbox was released, it reached out to their fundamental
target audience via platforms such as Digg, HackerNews. After they
released the product, they took certain steps for growth, one of which
was acquisition through SEM. When they analyzed their acquisition
rate via SEM, they found that the cost for an average user was between
$233 and $388. Considering that the product itself was $99, this was
not a viable option.
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In order to acquire new users, they decided to utilize their existing

users. When a user invited a friend to Dropbox, they were both
rewarded with free extra space. This was the main driver that
accelerated the growth process of Dropbox. In September 2008, they
had 100.000 users and by January 2010, that number had skyrocketed
to 4.000.000. The extra space they offered quickly converted the 7-8
users on the NPS scale to promoters.
Airbnb Referral Flow
Airbnb is a marketplace where you can rent out your house or your
room for a short period of time, as well as renting a house or room
for yourself wherever you like in the world. Lets talk about their
invitation flow by taking a look at their landing page for new users:
In order to create a referral motivation Airbnb decided to go for a

similar scenario to Dropbox. If a friend you invited to Airbnb rents a
place, you earn 20 dollars, or rents out their own space you earn 80
dollars.
Therefore, Airbnb has provided the users with referral motivations
with the necessary channels to invite their friends (e-mailing your
connections, sharing on social networks and sharing private links).
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Each of these channels have been designed to motivate the referred

users.
Another thing that Airbnb is excellent at is the greeting phase for
the referred users.
The referred users are greeted with a personalized message including

their name and photograph. Therefore the whole referral sequence
takes shape with their customized needs in mind.
Creative Referral Approaches

Referral scenarios have room for some very creative approaches.
An exciting venture from Turkey called Cubic.fm, created a waiting
list for its application, which made for a very interesting example.
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The users who wanted to go up in the waiting list were asked to

invite their friends to Cubic.fm. The referral flows and the messages
were very well optimized.
Another successful example is Kickstarter. Here, when you help
fund a project on Kickstarter it turns your contribution into a message
you can share on social networks and includes you in the natural
referral flow.
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5. Revenue
The last step in the growth process is revenue. Your options vary
greatly in the revenue stage, as they depend on the advancement of
your venture, your business model and your product. This section
aims to answer questions such as What are the fundamental things
you should pay attention to in a payment section? How can you
expand your business with business development? How can you
acquire new customers with affiliate networks? at length.
Payment Section Recommendations
Your user acquisition takes place in the acquisition and activation
phases, whereas your customer acquisition takes place in the payment
phase. Your payment sections design can vary greatly depending on
the profile and needs of your product and customer base. Lets talk
about some fundamental tactics that can be useful for almost any
venture:
1.
Remove distracting elements from the page: If the user is
in the payment stage, they are ready to pay and be your customer.
There should be no distractions there that would hinder or slow down
the payment process. Most of the payment pages we see today feature
no outer links, except for the main menu and the payment links
themselves, which is a useful thing to know.
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2.
Be as clear and concise as possible in your texts and
redirections: Try to be as clear as possible in the texts and redirections
you use on your payment page. Instead of using new and different
terms, try to use standard terms that would resonate with your targed
audience profile. Clearly outline the payment total and the remaining
steps to your audience.
The users who wanted to go up in the waiting list were asked to
invite their friends to Cubic.fm. The referral flows and the messages
were very well optimized.
Another successful example is Kickstarter. Here, when you help
fund a project on Kickstarter it turns your contribution into a message
you can share on social networks and includes you in the natural
referral flow.
3.
Emphasize security: Especially for SaaS applications that
work with a monthly payment model, the security of the users credit
card and payment information and informing them of their secure
state is essential. Carefully and clearly explain how safe your payment
system is in detail for those who wish to know. Support your statements
with press clippings, happy customer testimonials, as well as the logos
of your previous clients as a token of security on your page in a nondistracting way.
4.
Try to minimalize form areas: Do not ask for any unnecessary
details on the payment page. Just ask the user for the essentials for
payment, so that they can complete that stage quickly. You can explain
why you need a particular piece of information by using tooltipsto
explain where that information will be used. That way, you will be
reassuring the users.
5.
Make legal texts accessible: Make sure the users can view the
terms and conditions and privacy policy on the payment page. Make
sure that users who wish to view those texts in detail can do so without
leaving the page. Try to offer different solutions on the page for those
who want to make corporate purchases.
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With these five fundamental techniques, you can avoid the most
common payment stage pitfalls. For a successful payment page, you
need to analyze the behaviour exhibited by your users during the
payment process. When you find out where and why you lost them
during the process, you will see what the problem is.
Business Development
In order to be successful in business development, you need to clearly
outline what your expectations towards a parnership are, as well as
your goals. That way, you will have determined the right partner for
your business development plan, as well as the scope for your
development. Do not form partnerships with events or connections,
or just because you can. For every partnership or connection you
form, make sure the big picture is still relevant to your goals and
aspirations in terms of the future of your venture.
After outlining your goals and objectives, you should choose who
you wish to work with for a successful growth process. Do not contact
your chosen partners before you have clearly outlined the boundaries
and scope of your venture and the partnership you have in mind.
When you are planning a partnership, remember that a sustainable
partnership is based on mutual value generation. Do your research
well and make sure that your partner is able to generate value for
their end too.
After you have formed a clear idea as to what kind of work you will
be doing with your partner, you can start contacting potential partners
with offers. Remember the importance of forming a mutual bond of
trust during the introduction phase. Do not be hasty in the process
and do not push for results too quickly. Try to form long term bonds
with them by adding mutual contacts into the mix if possible.
The business development phase is a private phase between
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companies, so it is not usually very transparent and open to

observation in terms of results, but lets talk about a well-known
example. Stripe is an application that allows you to receive online
payments. Shopify is a successful e-commerce site.
Stripe developed a partnership with Shopify in 2013. Shopify users

could choose Stripe as a payment method while they created their
e-commerce profiles there and could set their payment system up
fairly quickly by doing so. Thanks to this partnership, Stripe achieved
tremendous growth in a short time period.
When we review this partnership, we see that they both benefited
from the end result. Stripe managed to reach Shopifys established
customer base and Shopify managed to provide its users with a quick
and safe solution to their payment problem.
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For a successful business partnership, you do not need large scale

integrations or collaborations. KISSmetrics and Unbounce are two
essential tools for digital marketing experts. When we take a look at
their marketing activities, we can safely say that content generation
is essential for both.
KISSmetrics and Unbounce started creating common content for
their target audiences together. When the users wanted to download
the content, they signed up for both Unbounce and KISSmetrics
e-mailing lists at the same time.
Affiliate Programs
Affiliate programs are one of the most fundamental performance
based marketing practises. They provide an effective channel in
boosting the revenue of revenue based product/service vendors and
SaaS applications, as well as startups that work with a subscription
model. To define it briefly, we can say that it is the act of sharing a
portion of your revenue with a referral party for every successful
transaction.
For instance, there are various independent and professionally run
blogs and online communities out there. These blogs can urge your
followers to buy your product or service with the content they produce,
their banners and other redirections. For every successfully conducted
transaction that takes place thanks to these blogs or communities,
you pay them a small fee.
Since the affiliate channel contains a tremendous amount of knowhow, it can pose a few difficulties for newcomers at first. Sendloop,
a SaaS application, has been using this channel effectively for a
number of years. After contacting them and asking about tips for
newcomers who want to use the affiliate channel, I outlined their
main suggestions:
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1.
Define the plan and scope of your affiliate work very well.
Affiliate can be an effective channel in increasing sales and reaching
out to new customers. However, at the beginning of the process, the
relation between the program and the affiliates needs to be clearly
defined. The super affiliate members of the program can provide a
very big potential for your product at first. When they manage to
establish true value for your product in terms of customers, there
can be some different demands and directives issued by them towards
the product or service in question. If you do not meet these demands,
they might choose to threaten you, saying they will be taking their
user base with them if they leave. In order to avoid that, try to define
the boundaries between the venture and the affiliate very well.
2.
Calculate your commission rates carefully. In order to get a
good performance out of affiliate programs, you might need to keep
your publisher commissions high. Therefore, the publishers will pay
you more attention in the beginning and work harder to bring you
new customers. If your initial commission rates are not well calculated,
this might cause big issues in sustainability later on. Do not make
any decisions that might endanger your startup in order to get quick
result. Bear in mind that the work you are doing now will directly
influence your financial well-being later.
3.
Keep a close watch on your acquired customer base. Another
issue you might face in the affiliate programs is keeping up with the
customer base you acquire through publications. If you do not keep
up with them well, this might pose a big problem for your venture
later on. Cancelled account and refund requests should be tracked
carefully. As previously mentioned, the lifespan of your users
experience with the product is critical.
4.
Do not underestimate the power of readymade affiliate
programs. In designing your affiliate program, might want to devise
your own personal program to carefully outline your boundaries and
83
track your processes and your customer base. This might be a logical
solution when your product and affiliate network have reached a
certain level of maturity. If you are just starting out, however, globally
efficient affiliate networks can be a good choice in terms of connecting
with the publishers.
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Growth doesnt come from silver bullets, growth

comes from winning a thousand tiny battles:0.5%
here, 1%there.Real growth needs a whole load of
lead bullets.Real growth originates from the very
first line code, from a great product and form the
work of an entire team.
Ben McRedmond
Tweet
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CHAPTER IV
Growth Hacking Mistakes
In this chapter, I am going to talk about some common misconceptions

related to growth hacking.
SEO = Growth Hacking
As mentioned in some of the previous chapters, the most common
misconception you can fall into is the growth = traffic equation. One
of the most common topics you will come across in that realm is SEO.
By working on SEO, you can achieve better search results for your
website. That way, it will be easier to find on search engines and reach
a larger audience. This is only one of the various channels for
acquisition that we discussed when we talked about the AARRR cycle.
In order to conduct a successful acquisition plan, you should not
focus on one channel, and to achieve successful growth, you need to
focus on more than just acquisition. In that regard, SEO is only a
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channel in acquisition for the duration of the growth hacking

process. Outside of that realm, the SEO = Growth Hacking equation
simply is not true.
Gaining Free Traffic from Social Networks
The second largest issue generated by the Growth = Traffic equation
is the spamming activities made via social networks to achieve traffic.
Social networks are just one of the channels that can be used to reach
a certain audience. In order to acquire new users from social networks,
one needs the right content and scenarios. Most of the activities that
are targeted towards acquisition are classified as spam if they lack
good content and value generation. Auto follower bots, page like
boosts, auto bot comment to popular accounts are all methods that
should be strictly avoided.
Growth Overnight
To expand and grow your business requires systematic effort. No
business can expand overnight with a good idea or an application.
Growth hacking enables you to establish the right systematics, to find
real solutions to the right problems and to effectively analyze and
optimize your growth process. True growth is not achieved by the
application of one magic idea, but the result of testing out numerous
ideas and applications.
Growth Hacking = Zero Budget Marketing
One of the biggest misconceptions about growth hacking is the fact
that it is thought to be a zero budget marketing practice. Most of the
work that is done with that perspective is branded as spam. It is
undeniable that ventures try to achieve their growth process with
organic methods and with minimal budgets, but programming the
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growth process to achieve its marketing goals with zero budget will
not yield any growth at the end of the day. Growth hacking aims to
encapsulate and work with only the effective methods that produce
actual growth.
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Congratulations: you have finished the introduction

to Growth Hacking. I hope it has been a beneficial
experience for you.
If youd like to share your thoughts and comments,
click here to drop me a line. I can assure you that
every single feedback is equally precious for my
future work. Lastly, if youd like to share the book
with friends and let them know, feel free to tweet
about it, share it on Facebook or update your
Goodreads profile by adding the book to your read
list!
References
http://www.leanmarketing.co
http://500hats.typepad.com
http://blog.hubspot.com
http://blog.kissmetrics.com
http://blog.pmarca.com
http://christophjanz.blogspot.com
http://web.stanford.edu/class/ee204/ProductMarketFit.html#c1
http://www.52weeksofux.com
http://www.aginnt.com
http://www.andrewchen.co/
http://www.avc.com
http://www.bothsidesofthetable.com
http://www.churn-rate.com
http://www.coelevate.com
http://www.conversionxl.com/blog/
http://www.econsultancy.com/blog/
http://www.firstround.com/review/
http://www.forentrepreneurs.com
http://www.getvero.com/
http://www.girisimcilik101.com/
http://www.growthhackers.com
http://www.helpscout.net/blog/
http://www.hitenism.com
http://www.hookmodel.com
http://www.interaction-design.org
http://www.jwegan.com
http://www.marketingexperiments.com/blog/
http://www.medium.com/@dantmurphy
http://www.muhammedtufekyapan.com
http://www.netpromoter.com
http://www.nirandfar.com
http://www.numeratechoir.com
http://www.onlinepazarlama.co
http://www.paulgraham.com
http://www.pierrelechelle.com
http://www.quora.com
http://www.raphaelpaulindaigle.com/blog/
http://www.ryangum.com
http://www.sachinrekhi.com
http://www.sixteenventures.com
http://www.smashingmagazine.com/
http://www.startup-marketing.com
http://www.startuplessonslearned.com
http://www.thinkwithgoogle.com
http://www.tomtunguz.com
http://www.unbounce.com/resources/
http://www.usability.gov
http://www.uxbooth.com
Growth Hackinge
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Introduction

What is the Growth Hacking?