Why Growth Hacking Doesn’t Increase Your Profitability

I interviewed Gaetano to get his thoughts on permission based marketing and growth hacking. He said that users have control over what they are willing to give up their information for.

Gaetano DiNardi’s recent article really pissed off a lot of marketing managers.

I had been following him on LinkedIn for a while when I saw his post that really got my attention.

He said the most disturbing trend in marketing is when influencers promote spam-like tactics to their fans and call it growth hacking.

The person said that a well-known marketer posted on LinkedIn about how to hack Product Hunt. He told his followers to export their contacts from LinkedIn and email, merge them into a CSV file, then upload it onto Product Hunt for the next launch.

You can send people notifications and updates about your product, even if they didn’t ask for it.

Gaetano had a lot to say about this tip, and he was not impressed. He felt that the tips amounted to spam.

After the interaction, I began to think about what was behind this.


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Today’s Two Rival Forces in B2B Marketing

GDPR and determining the least-resistant path

There are two opposing forces in permission based marketing today.

GDPR has made data management a top priority.

On the other hand, some people in growth hacking are obsessed with finding shortcuts to building a following on social media. They take risks that many of us wouldn’t be okay with.

I asked Gaetano what he thought about this.

He said that the idea of permission based marketing is to not send unsolicited email promotions or any other type of promotional content, without their initial consent.

Explicit vs. implicit consent

One of the major concerns with GDPR is how it will affect startups. There’s a lot of concern about whether or not these companies are going to be fined as much because they don’t have as many employees and their data isn’t being stored in the same way.

“Whether you want to believe it or not, that may be true for some people. There are a lot of amateurs who just want the next big thing and post hacky ways on how to get ahead in their Facebook groups.

I thought that the post I saw was a GDPR nightmare, and it also made me wonder if CEOs would start to get irritated by my spammy updates about products they don’t care about.

It seems like there’s not much that can be done about this issue, and Gaetano tagged the CEO of Product Hunt to get his thoughts. He said they don’t have any control over who gets access.

“This is not permission based marketing and when I challenged the person who posted this tactic, they received a lot of backlash from people in the group. Even their owner took an aggressive stance that it’s only spam until everyone starts doing it. If you are ahead of the curve with finding new ways to break through, then what you do becomes spam once other companies catch up.”

That’s shaky ground there.

The Answer is Not Growth Hacking

The problem with this approach to growth hacking, according to Gaetano, is that you have continually find new ways of doing it. If everyone catches on and starts following the same hack strategy then you will need a brand-new one.

The GH community also talks about the importance of hard work and content strategy. But sometimes it’s overshadowed by shortcuts like this one.

We talked about how organic traffic is a good start but you need to add some “growth hacks” on top of that.

I think the problem is that it’s too hard to get there today, and I don’t know where.

Why Do We Still Need Growth Hacking?

With so many people using different social media sites, content permission based marketing has become a lot more difficult.

It can be hard for a startup to establish itself in an industry when it’s so competitive.

Amazing content alone is not enough

He says that amazing content is not enough anymore because there are so many other people who have great content too. Startups in particular need to get ahead fast, and they can’t waste any time or resources.

Growth hacking is a thing because it’s easier to grow your company when you’re constantly looking for new ways of doing so.

Marketers are desperate for an audience and will do anything to get one, even if it means going against the rules of permission based marketing.

The difference in retargeting vs. growth hacking

It’s not just complicated, it takes time. Facebook allows us to do this for years and you can upload a contact list in ten minutes.

Retargeting is used because users are aware they will be retargeted when they opt-in to your contact list.

But emailing from other sites and apps is considered spammy. Here’s why.

Every Marketers Should be Accountable

When users opt-in for emails, they expect to receive certain information. GDPR tells us that we need to specify what kind of email content will be sent and how their data will be managed.

But when you upload email addresses to another site and start sending people messages, they may not necessarily know where the blame lies. They are getting unwanted messages from a different source.

“There’s a buffer layer between the users and marketers,” Gaetano said. “If they get pissed off at us on this other site that we manage, then all they do is unsubscribe from it but not make an actual spam complaint against us.

Marketers are already in the hot seat, but if they use a site like Facebook to buffer them from user criticism, their accountability will disappear.

Making Do With a Little Assistance from Your Friends

Sean Ellis, the founder and CEO of GrowthHackers, is a brilliant guy who realized that activating your most loyal customers can be powerful. In one example with Dropbox, they offered 16 GB of free space to people when their friends signed up.

Referral sales is a good example of growth hacking because it puts the power in your hands and incentivizes you to tell people about our product.

While many companies offer tangible rewards, it is more important to focus on your alpha audience. They will help you reach viral growth.

“I think one of the most important things in growth hacking is to be resourceful,” Gaetano says. “At the end of the day, it’s about making an impact with fewer resources and still getting a sizable return on those efforts.”

One of the most powerful ways to get people hooked on your product is by getting them in that early adoption phase. You can do this by giving out a freebie after they friend you or invite their friends.

Plan and Test if It’s Legit

Growth hacking is often an experiment that needs to be tested and measured against clear objectives.

How to determine whether or not an ad is worth running

You need to figure out how long the experiment will last. And you also have to consider what it is costing your team in terms of time and effort.

What other things could you have done instead? Any sort of marketing has to be treated like a campaign. You need to decide what the outcome should be and whether or not it was successful.

It’s important to figure out if an idea is worth trying in the first place. For example, Sales Hacker uses a system called BRASS (Blink, Relevance, AvailabilityAvailability), which assigns numbers to different aspects of an idea and compares them with other ideas.

Where growth hacking comes to a halt and permission based marketing takes over

Gaetano feels like growth hacking needs to be more clearly defined, and it should stop overlapping with permission based marketing.

In order to test something out, you need a good framework. You have to know how long it will take and if the outcome is successful.

Growth hacking is an essential part of marketing today, but it’s important to remember that there are no shortcuts. If you don’t have a strategy that involves days and months or even years of hard work – then your company won’t last long.


Need Help Automating Your Sales Prospecting Process?

LeadFuze gives you all the data you need to find ideal leads, including full contact information.

Go through a variety of filters to zero in on the leads you want to reach. This is crazy specific, but you could find all the people that match the following: 

  • A company in the Financial Services or Banking industry
  • Who have more than 10 employees
  • That spend money on Adwords
  • Who use Hubspot
  • Who currently have job openings for marketing help
  • With the role of HR Manager
  • That has only been in this role for less than 1 year
Just to give you an idea. 😀

 

Editors Note:

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Justin McGill
About Author: Justin McGill
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