Product-market fit is a standard to which a product satisfies the market’s demand. You can also describe it as a stage or process employed by a start-up company during which they successfully identify their target customers. Moreover, this provides the company to serve the customers with the right products. While the term growth hacking is a strategy focused only on growth. Used by the early-stage start-up companies who prefer massive growth in small budgets or short time. Let’s continue to read and get to know more about product-market fit vs growth hacking.
What you’ll read:
Besides the differentiation, you will find these in the blog:
Product-market fit
Understanding product-market fit
How to go about product-market fit
Growth Hacking
What is growth hacking?
What are the best growth hacking strategies?
Implementing Growth hacking
Growth hacking examples
PRODUCT-MARKET FIT
Product-market fit has been a common concept among start-ups. When a company fails to employ the concept, the result is unsatisfied buyers and you cannot run your business with an unsatisfied customer. In that case, no one will buy your products, that’s the reason why every business focuses on the key point “Customer Satisfaction.”
Consider the product-market as sailing, where demand is the wind and sail is the product. A proper sail and wind are necessitated to power up a boat. Similarly, to run a successful company, build a product that satisfies the need for a market.
Understanding and measuring product-market fit
The first thing that we should talk over in product-market fit vs growth hacking is their individual way of measurement and understanding. Conduct surveys to measure the product-market fit. With this, you will be able to identify whether your product fits in the “must-have” list of the customers or not. It’s an in-depth understanding of the questions like “who your customers are?” and “how they feel about your company’s product?”.
Understand more about the questions like “Is the product creating an organic growth? Are people willing to pay for your company’s product? Do your customers recommend your products to other people?” If the answer is yes, then congratulations! You perfectly have the product-market fit. The first step towards product-market fit is to find customers via word of mouth. Employ the first step before you build a market to scale user acquisition.
Your product might satisfy a small segment of the market at the beginning of your start-up. It is crucial to establish a relationship with your customers. Keep on talking with them over and over again to develop the understanding and increase your customers.
How to go about product-market fit?
Create a relationship with your customers
Continuous interviews with your customers and your users are mandatory. With this, you get to improve your products and build strong relationships. In the beginning, reaching out to your customers and users directly might be difficult. Go on by yourself and talk to the customers about your products. Customers and user interviews can be conducted via the hangout chats or in person. It depends on what and how you need to investigate. Prepare the template of specific questions. Also, try to improvise and elaborate on the questions to bring up prolix conversations.
When talking about product-market fit a company generally asks questions that answer certain things like:
- Customer and user’s background.
- Discover the customer’s pain points they experience and how they solve it.
- Questions like ‘How your product will help your customers? How customers are using your products? Did customers find ways to use your product with other tools?’
On the other side, employ the internal team members of your company in collecting the data. Support yourself, if you’re a small team. When you succeed to grow, build a team for customer support. It will help you in interacting with the customers and will get to learn their needs.
Build up a system to store the customer’s needs and report their problems, like effective CRM software. When you receive complaints regarding your product, grab it to learn about the demand. Incorporate the required features in your product and make it more useful.
Customer feedback is crucial for every company. Few feedbacks might help you today while others after a year. Always tend to adapt according to the customer’s needs and satisfaction.
GROWTH HACKING
In 2010, Sean Ellis coined the term “growth hacking” while he was trying to come up with a new job description. The growth hacking strategy aims to acquire customers and users while you spend less of your money.
Who is a growth hacker?
A growth hacker employs low-cost strategies and creative ideas. That helps the business to acquire and retain customers. Also, anyone involved in a product as product engineers and managers can be known as growth hackers.
How does growth hacking work?
Many start-ups use ‘pirate funnel’ for their business’s growth. That includes activation, retention, referral, acquisition, and revenue. Raising brand awareness seems to be the best part of growth hacking.
How to begin with growth hacking
The first step involves creating a product. Test it on whether customers want to buy it and are willing to pay for it. With this, you can gather data to understand your buyer personas. Finally, you can target the growth marketing tactics with the collected data. Continue to update your products on regular basis. Rely on your customer’s feedback and check whether you are on the right path. If not make changes in your products and make the customers love your products. Use conversion optimization techniques, which makes it prominent for effective growth hacking.
What are the best growth hacking strategies?
The growth hacking strategies are in three categories
- Advertising
- Content marketing
- Product marketing
From the above strategies, content marketing is a low-cost method. Attract customers to read about your products. Content marketing activities include:
- podcasting
- writing papers and e-book
- Guest blogging
- A blog with valuable and shareable content.
- Running webinars
- Creating social media content
- Joining relevant forums, groups, and subreddits
- Running contests
- Influencer marketing
- Building a strong connection via e-mail marketing
- Improving content visibility with SEO
- Getting listed in the relevant sites and marketplaces
Product marketing involves techniques for creating your products to look appealing and to build a user base. Product marketing includes:
- Offering incentives for referrals.
- Affiliate marketing will collaborate with content marketing tactics.
- Use an invite-only signup system that leverages the Fear of Missing Out (FOMO).
While the advertising involves social media advertising, television channel-wise advertising, and pay per click (PPC) advertising to promote your business.
Implement growth hacking in your team
Behind every successful growth, hacking activity is a structured process that is instability and iteration. Whether you’re a large organization or a start-up, B2C, or B2B, the process can be incorporated and customized into a successful growth strategy.
Set a measurable goal:
A growth hacker’s success lies in actionable goals that lead you into the overall growth. It helps in limiting the temptation to burden your focus and maximizes the time you spend on refining your approach.
Make your product perfect:
Analyze the requirement and preferences of your target market. Make use of the data to enhance your product.
Test your approach:
Growth hacking is a collection of creativity and experimentation. Testing is essential to know which product will and will not work. Keep your test simple and lean. Record the data to implement the best combination providing an enhancement in growth.
Analyze Performance:
Analytic is essential to stay on the right path towards your goal. Make a goal in achieving success with your product. As your graph progresses, the acquired data can be used to adjust and adapt changes in your products to get up to your goal.
Optimize:
Success comes with a bit of practice and patients. Implement a new approach or change the previous effort. As there is always a value for the ‘learning-by-doing’ approach. So, learn about your failures in your product. It will help you to produce a successful product that satisfies your customer.
Examples of Growth Hacking:
Let’s dive into a few popular examples of the successful growth hacking campaigns:
Hotmail:
Hotmail encourages people to sign up for a new account that appended a line to each outgoing email.
Dropbox:
Dropbox rewards existing users with additional storage, for the act of inviting new users.
Facebook:
Facebook encourages people to add their email id and contacts on their sign–up. Therefore, as it sends a notification to the user’s mail, it prompts them to sign-in and to see what had been said about them.
Dollar Shave:
Dollar Shave used video marketing to promote the service of sending people one dollar worth of razor blades. At the end of the day, the video went up viral promoting their company.
Product-market fit vs growth hacking
- Product market fit focuses on the growth of the target audience while growth hacking focuses on the growth of the business.
- Growth hacking aims for rapid growth while product-market fit aims for sustaining the growth of your business.
- Product-market fit involves slow and steady growth (similar to a tortoise). Growth hacking involves rapid growth (similar to the rabbit).
- Since a simple tactic is used as a growth hack, it seems cheaper than having a product-market fit. Product-market fit includes broader concepts that involve a ton of money for the company’s product to be fit into the market’s demand.
- If you’re focusing on brand awareness, go for product-market fit but if you feel to be focused solely on the growth of your business, then go for growth hacking.
- Every business requires to achieve product-market fit before starting with growth hacking.
In conclusion, growth hacking vs product market fit are the two faces of the same coin. You should note down the pros and cons and follow one that you believe will get you the best results. If you want us to help your startup in consulting or in digital marketing we can help you out. Check out our website.