Notes on Hacking Growth

I recently read Hacking Growth by Sean Ellis and Morgan Brown. I highlighted and took notes on points that I found helpful and questions…

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I recently read Hacking Growth by Sean Ellis and Morgan Brown. I highlighted and took notes on points that I found helpful and questions that I asked myself. If you work on or with a growth team I recommend reading the book for practical advice and ideas.

Hacking Growth: How Today's Fastest-Growing Companies Drive Breakout Success
The definitive playbook by the pioneers of Growth Hacking, one of the hottest business methodologies in Silicon Valley…


  • How much drop off is there from people who get invited to those that sign up and why? (Page 4)

  • Dropbox offered more storage in lieu of credit or money. What do our users value disproportionately? (page 7, 167)

  • “We looked at the experiments twice a week…” Does this imply that rigorous AB testing is not necessary for a successful growth program? (page 8)

  • How can we increase the tempo of our experimentation? (Page 18)

  • You need data scientists who can really appreciate consumer insights and understand business problems (page 20)

  • Most growth is due to an accumulation of small wins (page 22)

Part I: The Method

  • How many surveys are we running and are we doing so systematically? (page 31)

  • The growth lead then ensures that the team is not derailed by pursuing ideas that don’t contribute to their stated goal, tabling those for when the focus changes and those ideas will serve the new objective (page 37)

  • A standout data scientist can make the difference between a growth team squandering its time and mining data gold (page 42)

  • The growth hacking process is a continuous cycle comprising four key steps: (1) data analysis and insight gathering; (2) idea generation; (3) experiment prioritization; and (4) running the experiments, and then circles back to the analyze step to review results and decide the next steps (page 43)

  • Viral word of mouth can work two ways; it can supercharge growth or it can stop it in its tracks (page 60)

  • Can you identify an aha moment that users love? (page 64)

  • Customers who went through up-front product training were retained much longer than those who didn’t. (page 84)

  • Scattershot experimentation is a sure way to waste time and effort (page 89)

  • What is our fundamental growth equation? (page 91)

  • “A good plan violently executed now is better than a perfect plan tomorrow.” -Patton (page 99)

  • If no one on the team (outside of the data analysts) can understand your findings, they are unlikely to result in meaningful action (page 102)

  • Metrics should be presented as ratios rather than static numbers (page 106)

  • The companies that grow the fastest are the ones that learn the fastest (page 111)

  • Where do we keep our “idea pipeline”? (page 119)

  • Authors suggest 99% statistical significance because they run so many tests (page 131)

  • Control always wins! (page 131)

  • Potential confounding issues, such as the time of year the test was run, or if there were other promotions that may skew behavior (page 132)

Part II: The Growth Hacking Playbook

  • The downside of offering cash, even in the form of discounts, is that it’s very easy to calculate its value in relation to what you are asked to do to receive it, and this can make it hard to motivate people to act without larger sums to stir action (page 167)

  • The first rule of designing and optimizing your NUX is to treat it as a unique, onetime encounter with your product (page 183)

  • How can we flip the funnel? (page 184)

  • Sometimes you want to put some positive friction in a user’s way (page 187)

  • Zappos tried to create higher-frequency shoppers by gamifying the shopping experience; offering badges for doing things like favoriting a shoe model and buying multiple pairs, but the badges offered no value — no higher discounts or other benefits — and left customers confused, leading Zappos to ultimately shutter the effort. (page 192)

  • The most effective rewards in a gamified setting come in the form of status, access, power, and stuff (page 193)

  • Can we create a holdout group to measure the aggregate impact of growth campaigns? (page 196)

  • Three categories of trigger: facilitator, which helps those with high motivation but low ability take action; signal, which helps keep people with high motivation and high ability headed in the right direction and encourages repeat action; spark, which spurs people with high ability yet low motivation to take action (page 197)

  • Cialdini’s 6 principles of persuasion: (page 197)

  1. Reciprocity — whereby people are more likely to do something in return of a favor, regardless of the favor done and the ask now presented to them

  2. Commitment and consistency — people who have taken one action are likely to take another, regardless of the size of or difference in action

  3. Social proof — in a state of uncertainty, people look to the actions of others to help them make their own decisions

  4. Authority — people look to those in the position of authority to decide which actions to take

  5. Liking — people will do business more readily with people and companies they like over those they don’t or are indifferent to

  6. Scarcity — people will take action when they are worried that they will miss out on the opportunity in the future

  • Think of retention in 3 phases: initial, medium-term, long-term

  • Frequent-flier programs have long used social rewards such as improved status, access to exclusive lounges, and preferential boarding order, and found them to be far stronger motivators of loyalty than discounted airfare.

  • Bing Gordon, a venture capitalist at Kleiner Perkins Caufield & Byers, shared how powerful the “Coming Soon” hack can be when he recounted a conversation that he had with HBO chief executive Chris Albrecht. Albrecht had okayed the production of Rome, an original production that is famous for being one of the most expensive shows ever made for television, with a per episode cost of $ 9 million. When Gordon asked Albrecht if the exorbitant cost was tough to swallow for a show that ultimately didn’t draw a ton of viewership, the HBO CEO shared with Gordon the power of “Coming Soon” by revealing that HBO experienced almost no customer churn between the time the show was announced and the first episode aired; subscribers, it turned out, were intent on sticking around to see what the fuss around the new show was all about — even if many didn’t end up ultimately watching it. Indeed, for those two intervening months, the company experienced near-zero customer churn, with those captured revenues more than paying for the cost of production. (page 224)

  • HotelTonight, a mobile app that allows customers to book last-minute hotel rooms at a significant discount, made an important and unexpected discovery when they analyzed the purchase behavior of their customers based on how they connected to the app (that is, either over Wi-Fi or via 3G or 4G cellular connections). Their hypothesis for the rather confusing finding that customers who connected via 3G or 4G booked at twice the rate of those using the app over Wi-Fi (after all, shouldn’t it be easier to book on Wi-Fi?) was that comparison shopping on other travel sites was easier over Wi-Fi than over a spotty data connection; that with spotty data the sluggish competitive websites were too slow and unreliable, leading those customers to more readily book with HotelTonight rather than doing the comparison shopping that could have easily been done over fast Wi-Fi. Using this insight, HotelTonight focused its advertising to target only users who weren’t using Wi-Fi to connect to the Web, and drove higher purchase rates from new customers who saw their ads as a result. (page 237)

  • DON’T BE INTRUSIVE customizing can backfire if you’re not sensitive. If you seem to be prying too deeply into people’s lives, customization becomes creepy (page 244)

  • No matter what product you are trying to monetize, as you create options for customers, you want to be sure that your pricing is in proportion to the value they are getting from the use of your product. (page 249)

  • But beware: as with personalization, dynamic pricing can backfire if done wrong, as the travel website Orbitz learned when news broke that users who shopped for travel deals on the site using a Mac computer were routinely shown higher-priced hotels and travel packages than those who accessed the site on a PC. Indeed, Orbitz research had shown that Mac users were willing and able to spend up to 30 percent more on hotel rooms, and the company used the data to extract more revenue from them. 11 Needless to say that upon learning this, Mac customers were not pleased. (page 251)

  • Venture capitalist Josh Kopelman dubbed this pricing conundrum the penny gap, which refers to the large difference consumers perceive between a product being free and paying even a small amount for it. (page 256)

  • We all know that consumers are not always rational or predictable. They say they want one thing, yet pay for another (page 258)

  • Some of Costco's product demonstrations have increased purchasing by as much as 2,000%, in part because when customers feel that they have received something for free they feel compelled to reciprocate with a purchase. (page 259)

  • Testimonials should be CRAVENS: Credible, Relevant, Attractive, Visual, Enumerated, Nearby purchase points, and Specific (page 261)

  • Growth stalls can occur because companies lose focus on their core products or services, becoming distracted by the launch of shiny new products, bells-and-whistles extensions, and making an entry into new markets (I saw this at Wealthfront.) (page 267)