All your strategies focused on growth are, in fact, investment strategies. You are investing time, effort, and company resources to achieve massive growth in a limited time. What does your decision-making process look like? Do you base your decisions on a hunch or on past experiences? Or, are you using a data-driven approach?

Investing with data can appear cutting-edge. One may struggle to see the value it brings to growth hacking initiatives, especially if they don’t have any contact with data and analytics within the growth hacking domain. Let’s see what value data-driven3 growth hacking brings to the table.

Growth hacking – the essentials

People across verticals have been using the term “growth hacking” ever since Sean Elis used the term “Growth Hacker” to describe a person focused on finding the best strategy to promote rapid business growth. Today the term refers to all strategies developed with business growth in mind.

Growth hacking also implies cost efficiency. In other words, it refers to strategies tailored to maximize the conversion rates while keeping the costs minimal. Given that startups and small businesses have limited budgets, it doesn’t come as a surprise to see these two frequently turning to growth hacking strategies. Now, let’s see what it has to do with investing with data.

Investing with data and growth hacking 

Investing with data stands at the opposite of investing on a hunch or basing decisions on speculations. Ask any trader out there about their own opinion, and you’ll most certainly get a different one from each one you ask. The same applies to growth hacking. 

How do you make the right decisions then? This is where investing with data and investment research comes in. 

As an investor, you want to identify the best investment opportunities. In the world of growth hacking, you want to identify a strategy that’s worth your resources and effort. However, instead of basing decisions on a hunch, you base them on data.

That’s what people refer to as a data-driven approach, in our case, data-driven growth hacking. 

What is data-driven growth hacking?

Data-driven growth hacking still refers to identifying and using the best marketing and sales strategies and improving business processes to maximize profits. But instead of basing decisions on a hunch, it implies that you should use data. But, where does the data come from?

The data is already there, on your social media profiles and hidden in your business interactions and history with consumers. Plus, you can create new sets of data running tests, experiments, and forecasting business KPIs. 

When you have access to data, you can make smarter decisions. Investing with data can help you identify growth hacking shortcuts and achieve your goals much faster. Here are a couple of noteworthy benefits data-driven growth hacking brings to the table.

Minimize the risk of making errors

The most commonly made mistakes during growth marketing campaigns are rooted in biased decisions. Biases often happen because growth teams are driven by past experiences. There is no room for errors when you are running tests and experiments trying to identify the factors that positively affect your KPIs. The wants and needs of your customers at every step of their buying decision is a story only data can tell.

With data, your experiments will deliver accurate outputs and help you make data-driven business decisions. You can use data to identify factors that drive customer behavior and choose the best possible strategy to achieve a desirable outcome. 

Facilitate innovation

Business innovation is far more than coming up with new ideas and implementing them in your business processes. From the growth hacker’s point of view, every innovation has to be turned into a hypothesis when you look at it. Then, that hypothesis must be tested and either validated or discarded. If your growth ideas, decision after decision, keep damaging business, it kills innovation and loses you money.

The data, on the other hand, can stabilize the process. How come? Because with data, you can run experiments and safely validate hypotheses and only implement them when they prove safe. It will enable your growth marketing team to embrace innovation without worrying about whether it backfires on the company. 

Become more flexible

Flexibility follows innovation. Imagine punishing or, even worse, being forced to let go of people because their ideas took a chunk of your business performance. It simply sends a message that there is no room to wiggle. With limited flexibility, your growth teams won’t be able to innovate and experiment.

Investing with data can help you change it. You will have all the flexibility in the world to run experiments and validate hypotheses. Your teams will have more opportunities to learn and improve. You will establish a data-driven culture and bring flexibility to your entire organization and not only growth teams. 

Launch perfect digital marketing campaigns

One of the main challenges of digital marketing is choosing the right content and marketing channel. When you are able to aggregate and analyze data, making the right choices is no longer a challenge. Data will help you identify buyer personas and build ideal customer profiles.

You have half of your growth hacking puzzle solved when you know where your potential customers hang out and what they want and need. All that’s left is for you to run a couple of experiments across different marketing channels and choose the one with the highest conversion rates.

Conclusion

Many people think about traders and stocks when they see “investing with data”. However, big data has penetrated many industries, and it has slowly become the most prominent business paradigm. As you can see, if you pair data with growth hacking, you can unlock many benefits ranging from increased flexibility to next-level digital marketing campaigns.