The growth hacking canvas is a tool and framework to have a set of processes that allow you to ask the right questions to generate growth ideas, consistently.
Growth hacking is a process of rapid experimentation, that is meant to unlock growth ideas to allow startups and less structured organizations to gain traction, as quickly as possible.
This process goes through four main phases that as in a loop comprise data analysis and insight gathering, idea generation, experiment prioritization, and running tests.
The process is ongoing, and it needs to happen over and over before being able to determine whether it works:
One key ingredient of growth hacking is the team. Indeed, the growth hacker isn’t a magician that makes companies grow magically.
Instead, it is a member of a team that coordinates to analyze the data and prioritizes the activities.
Usually, this is a so-called T-shaped profile:
A T-shaped profile is a person that has broad competencies in several areas, together with deep competence in one or two areas of expertise.
Growth hacking is first of all also a way to acquire clients and grow a business.
This means being able to track the activities of the growth marketer and assess at which stage of a sales funnel an activity falls.
Usually, growth hackers refer to the pirates’ funnel, also called the AARRR funnel:
The AARRR funnel has the following stages:
Acquisition
Activation
Retention
Revenue
Referral
This, of course, is an abstract framework and just one way to assess the path to acquiring customers, and users and gaining traction.
According to the growth hacking canvas from alexandercowan.com, those are the following building blocks and questions to ask:
Segments & Personas: Who are the customers? What do they think? See? Feel? Do?
Value Propositions: What’s compelling about the product to these personas? Why do they buy it, use it?
Brand Experiences:What are the key experiences customers have with the product? How do they find it? Buy it? Use it? How does this differ across actors? If a CIO or parent buys it and then a support person or child uses it, how does that work?
Branding: What is the personality of the brand? Its positioning? How does it talk about itself? How do is that executed?
Lexicon: What words and phrases do customers use to talk about the area? What do they type into Google?
Assets:What are the product’s most important brand assets?
Activities:What are the most important growth activities?
Organic Channels:What organic (unpaid) channels are most important to the product’s branding and growth?
Paid Channels:What paid channels are most important to the product’s branding and growth?
Promotional Infrastructure:What promotional infrastructure (email lists, in-store displays, social media accounts) is working for the brand?
The growth hacking canvas from growthhackingcanvas.com comprise ten building blocks that can be summarized in:
S.M.A.R.T GOALS: Goals that are specific, measurable, attainable, relevant, and timely
TARGET AUDIENCE: Who are you targeting with your specific marketing actions? Why are these segments so important?
ACQUISITION: How do users find you?
ACTIVATION: How can people refer to their friends?
RETENTION: Why would users come back?
REFERRAL: How can people refer to their friends?
REVENUE: How will you get paying customers?
BUDGET: What budget will you allocate to which actions?
GROWTH AREAS: Which areas will you focus on?
TOOLS: Which tools do you use for each area?
Key Takeaways
The Growth Hacking Canvas: The Growth Hacking Canvas is a powerful tool and framework that has become increasingly popular in the world of startups and growth-oriented organizations. It is designed to facilitate the generation of innovative growth ideas through a systematic and iterative process. By combining rapid experimentation and data analysis, the Growth Hacking Canvas enables companies to identify and implement strategies that can unlock rapid and sustainable growth.
Phases of Growth Hacking: The growth hacking process is structured around several key phases, each contributing to the overall objective of achieving accelerated growth. The first phase involves data analysis, where growth hackers dive deep into various metrics and user behaviors to gain valuable insights. These insights then serve as the foundation for the idea generation phase, where creative solutions and growth experiments are brainstormed.
T-Shaped Profile: Central to the success of growth hacking is the role of the growth hacker. Growth hackers are not magicians who magically make companies grow; instead, they are vital members of a team with a unique skill set. They possess a T-shaped profile, which means they have a broad range of competencies across multiple areas, making them versatile team players. At the same time, they have deep expertise in one or two specific areas, such as analytics, marketing, coding, or design.
Pirates’ Funnel (AARRR Funnel): The Pirates’ Funnel, also known as the AARRR Funnel, is a fundamental framework for growth hackers to assess and optimize the customer journey. It consists of five crucial stages that map out the entire lifecycle of a customer: Acquisition, which focuses on attracting potential customers; Activation, where users take the first meaningful action; Retention, aiming to keep users engaged and coming back; Revenue, converting users into paying customers; and Referral, encouraging users to refer others to the product or service.
Case Study
Company
Description
Growth Hacking Canvas Components
Dropbox
Dropbox
In its early days, Dropbox used a “refer a friend” growth hack. Users were encouraged to refer friends in exchange for extra storage space. This viral growth strategy led to millions of new users.
– Acquisition: Referral program incentivizing users to refer friends. – Activation: Extra storage space as a reward for referrals. – Revenue: Increased premium subscriptions.
Airbnb
Airbnb
Airbnb implemented a referral program where both referrers and referees received travel credits. This incentivized users to invite others, resulting in significant user growth.
– Activation: Incentivized referral program. – Referral: Encouraged users to refer friends and earn credits.
Hotmail
Hotmail
Hotmail added a simple message at the end of every outgoing email: “P.S. I love you. Get your free email at Hotmail.” This message turned every user into a potential Hotmail advocate.
– Activation: In-email referral message.
LinkedIn
LinkedIn
LinkedIn’s “People You May Know” feature encouraged users to connect with others in their network. This social interaction increased engagement and user retention on the platform.
– Activation: Feature to connect with others in the network. – Retention: Enhanced user engagement.
Uber
Uber
Uber utilized a growth hack by offering promo codes to new users. Word-of-mouth referrals and the convenience of ride-sharing contributed to its rapid expansion in multiple cities.
– Acquisition: Promo codes for new users. – Referral: Word-of-mouth referrals.
PayPal
PayPal
PayPal rewarded users with cash for referring new users and encouraged them to link their bank accounts for secure transactions. This strategy contributed to PayPal’s early growth.
– Acquisition: Cash rewards for referrals. – Activation: Encouraged linking bank accounts for secure transactions.
Evernote
Evernote
Evernote used the “freemium” model, offering a free basic version and a premium version. Users were enticed by the free version and then converted into paying customers for premium features.
– Activation: Freemium model offering free basic version. – Revenue: Conversion of users to premium subscribers.
Instagram
Instagram
Instagram leveraged social media integration, allowing users to share their photos on platforms like Facebook and Twitter. This virality attracted new users and increased engagement.
– Activation: Social media integration for sharing photos. – Referral: Viral sharing on social media platforms.
HubSpot
HubSpot
HubSpot offered a free marketing assessment tool in exchange for users’ contact information. This strategy generated leads and expanded their user base.
– Acquisition: Offered a free marketing assessment tool. – Activation: Collected contact information for lead generation.
Business development comprises a set of strategies and actions to grow a business via a mixture of sales, marketing, and distribution. While marketing usually relies on automation to reach a wider audience, and sales typically leverage a one-to-one approach. The business development’s role is that of generating distribution.
Market development is a growth-centric strategy that businesses use to identify or develop new market segments for existing products. Companies utilize the market development strategy to discover new potential buyers of their products or services.
A total addressable market or TAM is the available market for a product or service. That is a metric usually leveraged by startups to understand the business potential of an industry. Typically, a large addressable market is appealing to venture capitalists willing to back startups with extensive growth potential.
Growth engineering is a systematic, technical approach to the improvement of conversion and the user experience. Combined with business engineering it helps business people build valuable companies from scratch.
Growth marketing is a process of rapid experimentation, which in a way has to be “scientific” by keeping in mind that it is used by startups to grow, quickly. Thus, the “scientific” here is not meant in the academic sense. Growth marketing is expected to unlock growth, quickly and with an often limited budget.
Blitzscaling is a business concept and a book written by Reid Hoffman (LinkedIn Co-founder) and Chris Yeh. At its core, the concept of Blitzscaling is about growing at a rate that is so much faster than your competitors, that make you feel uncomfortable. In short, Blitzscaling is prioritizing speed over efficiency in the face of uncertainty.
In the Lean Startup, Eric Ries defined the engine of growth as “the mechanism that startups use to achieve sustainable growth.” He described sustainable growth as following a simple rule, “new customers come from the actions of past customers.” The three engines of growth are the sticky engine, the viral engine, and the paid engine. Each of those can be measured and tracked by a few key metrics.
fixed mindset believes their intelligence and talents are fixed traits that cannot be developed. The two mindsets were developed by American psychologist Carol Dweck while studying human motivation.
Both mindsets are comprised of conscious and subconscious thought patterns established at a very young age. In adult life, they have profound implications for personal and professional success.
Individuals with a growth mindset devote more time and effort to achieving difficult goals and by extension, are less concerned with the opinions or abilities of others. Individuals with a fixed mindset are sensitive to criticism and may be preoccupied with proving their talents to others.
The more you move from consumers to enterprise clients, the more you’ll need a sales force able to manage complex sales. As a rule of thumb, a more expensive product, in B2B or Enterprise, will require an organizational structure around sales. An inexpensive product to be offered to consumers will leverage on marketing.
STP marketing simplifies the market segmentation process and is one of the most commonly used approaches in modern marketing. The core focus of STP marketing is commercial effectiveness. Marketers use the approach to select the most valuable segments from a target audience and develop a product positioning strategy and marketing mix for each.
The sales funnel is a model used in marketing to represent an ideal, potential journey that potential customers go through before becoming actual customers. As a representation, it is also often an approximation, that helps marketing and sales teams structure their processes at scale, thus building repeatable sales and marketing tactics to convert customers.
Venture capitalist, Dave McClure, coined the acronym AARRR which is a simplified model that enables to understand what metrics and channels to look at, at each stage for the users’ path toward becoming customers and referrers of a brand.
The general concept of Bootstrapping connects to “a self-starting process that is supposed to proceed without external input.” In business, Bootstrapping means financing the growth of the company from the available cash flows produced by a viable business model. Bootstrapping requires the mastery of the key customers driving growth.
A sales cycle is the process that your company takes to sell your services and products. In simple words, it’s a series of steps that your sales reps need to go through with prospects that lead up to a closed sale.
Distribution represents the set of tactics, deals, and strategies that enable a company to make a product and service easily reachable and reached by its potential customers. It also serves as the bridge between product and marketing to create a controlled journey of how potential customers perceive a product before buying it.
Zero to One is a book by Peter Thiel. But it also represents a business mindset, more typical of tech, where building something wholly new is the default mode, rather than building something incrementally better. The core premise of Zero to One then is that it’s much more valuable to create a whole new market/product rather than starting from existing markets.
A digital channel is a marketing channel, part of a distributionstrategy, helping an organization to reach its potential customers via electronic means. There are several digital marketing channels, usually divided into organic and paid channels. Some organic channels are SEO, SMO, email marketing. And some paid channels comprise SEM, SMM, and display advertising.
RevOps – short for Revenue Operations – is a framework that aims to maximize the revenue potential of an organization. RevOps seeks to align these departments by giving them access to the same data and tools. With shared information, each then understands their role in the sales funnel and can work collaboratively to increase revenue.
In a logrolling negotiation, one party offers a concession on one issue to gain ground on another issue. In logrolling, there is no desire by either party to advertise the extent of their power, rights, or entitlements. This makes it a particularly effective strategy in complex negotiations where partial or complete impasses exist.
Win-win negotiations first rose to prominence during the 1980s, thanks in part to books like Roger Fisher, William Ury, and Bruce Patton’s bestseller Getting to Yes: Negotiating Agreement Without Giving In. Having said that, there was also a shifting mindset at the time as negotiators saw win-win negotiations as preferable to the then-dominant win-lose approach. A win-win negotiation is a negotiation outcome resulting in a mutually acceptable and beneficial deal for all involved parties.
In negotiation theory, BATNA stands for “Best Alternative To a Negotiated Agreement,” and it’s one of the key tenets of negotiation theory. Indeed, it describes the best course of action a party can take if negotiations fail to reach an agreement. This simple strategy can help improve the negotiation as each party is (in theory) willing to take the best course of action, as otherwise, an agreement won’t be reached.
In negotiation, WATNA stands for “worst alternative to a negotiated agreement,” representing one of several alternative options if a resolution cannot be reached. This is a useful technique to help understand what might be a negotiation outcome, that even if negative is still better than a WATNA, making the deal still feasible.
The ZOPA (zone of possible agreement) describes an area in which two negotiation parties may find common ground. Indeed, ZOPA is critical to explore the deals where the parties get a mutually beneficial outcome to prevent the risk of a win-lose, or lose-win scenario. And therefore get to the point of a win-win negotiation outcome.
Revenue modeling is a process of incorporating a sustainable financial model for revenue generation within a business model design. Revenue modeling can help to understand what options make more sense in creating a digital business from scratch; alternatively, it can help in analyzing existing digital businesses and reverse engineer them.
Customer experience maps are visual representations of every encounter a customer has with a brand. On a customer experience map, interactions called touchpoints visually denote each interaction that a business has with its consumers. Typically, these include every interaction from the first contact to marketing, branding, sales, and customer support.
AIDA stands for attention, interest, desire, and action. That is a model that is used in marketing to describe the potential journey a customer might go through before purchasing a product or service. The AIDA model helps organizations focus their efforts when optimizing their marketing activities based on the customers’ journeys.
Social selling is a process of developing trust, rapport, and a relationship with a prospect to enhance the sales cycle. It usually happens through tech platforms (like LinkedIn, Twitter, Facebook, and more), which enable salespeople to engage with potential prospects before closing the sale, thus becoming more effective.
The CHAMP methodology is an iteration of the BANT sales process for modern B2B applications. While budget, authority, need, and timing are important aspects of qualifying sales leads, the CHAMP methodology was developed after sales reps questioned the order in which the BANT process is followed.
The BANT process was conceived at IBM in the 1950s as a way to quickly identify prospects most likely to make a purchase. Despite its introduction around 70 years ago, the BANT process remains relevant today and was formally adopted into IBM’s Business Agility Solution Identification Guide.
The MEDDIC sales process was developed in 1996 by Dick Dunkel at software company Parametric Technology Corporation (PTC). The MEDDIC sales process is a framework used by B2B sales teams to foster predictable and efficient growth.
The virtuous cycle is a positive loop or a set of positive loops that trigger a non-linear growth. Indeed, in the context of digital platforms, virtuous cycles – also defined as flywheel models – help companies capture more market shares by accelerating growth. The classic example is Amazon’s lower prices driving more consumers, driving more sellers, thus improving variety and convenience, thus accelerating growth.
Business storytelling is a critical part of developing a business model. Indeed, the way you frame the story of your organization will influence its brand in the long-term. That’s because your brand story is tied to your brand identity, and it enables people to identify with a company.
Enterprise sales describes the procurement of large contracts that tend to be characterized by multiple decision-makers, complicated implementation, higher risk levels, or longer sales cycles.
Outside sales occur when a salesperson meets with prospects or customers in the field. This sort of sales function is critical to acquire larger accounts, like enterprise customers, for which the acquisition process is usually longer, more complex and it requires the understanding of the target organization. Thus the outside sales will cut through the noise to acquire a large enterprise account for the organization.
A freeterprise is a combination of free and enterprise where free professional accounts are driven into the funnel through the free product. As the opportunity is identified the company assigns the free account to a salesperson within the organization (inside sales or fields sales) to convert that into a B2B/enterprise account.
Palantir is a software company offering intelligence services from governments and institutions to large commercial organizations. The company’s two main platforms Gotham and Foundry, are integrated at enterprise-level. Its business model follows three phases: Acquire, Expand, and Scale. The company bears the pilot costs in the acquire and expand phases, and it runs at a loss. Where in the scale phase, the customers’ contribution margins become positive.
Consultative selling is a sales approach favoring relationship building and open dialogue to adequately meet the needs of a prospective customer. By building trust quickly a consultative selling approach can help the customer better meet her/his expectations and the salesperson hit her/his targets more effectively.
A unique selling proposition (USP) enables a business to differentiate itself from its competitors. Importantly, a USP enables a business to stand for something that they, in turn, become known among consumers. A strong and recognizable USP is crucial to operating successfully in competitive markets.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
