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Neil Patel predicts that agencies will focus on hiring growth hackers in 2014. He explains:
  • How these agencies will update their business models to charge clients for related services
  • Issues that they may encounter during this process
  • How they can get it right
He compares this shift to a recent focuses on both creative technology and customer acquisition.
  • MB

    Morgan Brown

    about 5 years ago #

    I think agencies will definitely get in on the growth hacker trend, some just for the buzz, but others as a way to differentiate and bring value to their clients. A few random thoughts:

    - For agencies to embrace growth hacking they have to get out of the 'campaign mindset'. This is deeply embedded. Everything is a campaign. To growth hackers, growth is always, every day, never ceasing. A campaign mentality has to be replaced by a continuous growth mentality.

    - Growth is about results, and not arbitrary, middle of the road results like click through rate, but real results. Number of users, cost per acquisition, retention, customer lifetime value. Many agencies shirk from owning these numbers. One, it's super risky to own those numbers as an agency—it's easy to tell if you're winning or losing. Two, because most agencies don't control the product experience, so it's tough to be tied to LTV when you dump people on the doorstep of a house which isn't yours to run.

    - To my point above, agencies will need to get more embedded with the product team, to help affect the product experience and help drive growth out of that experience. Without that ability, their opportunity for success is going to be severely limited by what the product does or doesn't do.

    Where I think agencies _can_ succeed with Growth hacking is in their ability to help their clients with the following:

    1) Language/Market Fit—A take on PMF, I heard this from Jim Currier at the GrowthHackers conference and it makes a lot of sense, the language you use for a product or service can vastly alter the user behavior AND the product design.

    His example is a photo-sharing service that went viral in the 2000's. At first the product tagline was "Store photos online". The word "store" is a powerful framing word—you think archival, backup, security, longevity. A personal locker for your memories. It's not just the users who think this way about the word, it's ALSO the product design and development team.

    That company changed from "store photos online" to "share photos online" and instantly it changed behavior. Now users were using it to share photos with friends—instantly creating lift—and the product team started thinking in terms of optimizing for sharing instead of storing. A major shift in product priorities all centered around sharing—the word of mouth, viral driver of growth.

    Agencies can be a tremendous asset in that regard.

    - Agencies can help test and iterate on the creative and copy that work the best. Growth hacking is not limited to free/low cost channels. It's ideal, but not a requirement. Agencies can help quickly iterate through paid campaigns to find things that really resonate and drive high-value customers to the service.

    When you are able to find the right customer via paid ads that converts better than anyone else, you can spend more than anyone else and dominate the channel. The mindset of small bets, quick iteration and creative thinking that are growth hacking hallmarks are all valuable here and something that agencies can own.

    - Understanding the customer. Core to growth hacking is discovering deep insights about your customers that help you optimize your product, message and model to drive growth. Agencies have long been tasked with consumer research, which has typically fallen to 3rd party research to validate media spend, etc. What if that research was turned inward to company databases and analytics to uncover insights. Sean says it's about turning data into a tool for growth instead of an accountability function. If agencies could turn their research prowess loose on company data they might glean those insights that unlock new growth opportunities.

    - Getting creative. This is what agencies do, but it's been about ad spend and campaign driven performance. If they were encouraged to get creative about the product, and thought about it in an ongoing, non-campaign focused manner, they'd be able to deliver ongoing value toward growth.

    Obviously there's a lot to talk about here. And no doubt agencies will want to be riding the buzzword, but they will have to make some adjustments to their model, push hard on their clients, and be willing to fail while learning where the real opportunities are.

    • LM

      Laura Moreno

      about 4 years ago #

      Great ideas Morgan! I agree 100%. I think agencies are kind of freaking out a little bit about growth hacking. They shouldn't be in my opinion. Some other agencies think the term will disappear, which I really don't think so. Thanks again for the post and all the best! Laura

    • BS

      Barrie Seppings

      about 5 years ago #

      This is great thinking Morgan. I reckon there's a lot to be gained from examining the strengths/weaknesses of both cultures and working out how a new combination might be able to outperform either, and you've clearly spent a lot of time looking at it this way. Kind of like hacking the Agency model for growth. Nice work.

  • SD

    Siddharth Deswal

    about 5 years ago #

    I'm not sure how this will work. Here are a few questions:

    1) Agencies want growth hackers, but do growth hackers want to work at agencies? Will 'I work at an agency' ever be cool enough for someone who has the skills to execute growth hacks?

    2) Growth hacking is primarily a series of experiments where the winners are iterated upon. That obviously includes a lot of failure. Does any large brand (which make up the bulk of agencies' clients) allow failure on its public facing properties? For example, will Vodafone allow a growth hacker to try experiments that might fail on its website?

    3) To my understanding, growth hacking doesn't have a 'strategy'. That is, you can't expect a growth hacking roadmap or plan which someone will stick to (please correct me if I'm wrong). But large organizations work on systems, processes, plans and budgets that enable them to grow while ensuring everything works well together. How does growth hacking fit in such a place?

    4) How can a large company move as quickly as a startup? To illustrate, let's suppose I wanted to implement Live Chat on Visual Website Optimizer, I could get it done in about a day max. Now what if Apple wants to implement live chat on their website? Given the number of daily visitors, they'd have to first get IT approval. Then, understand how many people do they need to hire to man those chat requests (maybe back here in India). Remember that it takes about 2 to 3 months on average to find the right candidate for any job. And finally, you've got to train all the people you've hired for all the queries they'll be handling. So one simple experiment... to see if live chat works for Apple or not, turns out to be a fairly significant activity that costs a lot of time and money.

    All in all Barrie, growth hacking might be this new cool thing, but I'm not sure if its scrappy nature will fit very well with agencies and their clients. Your views?

    • BS

      Barrie Seppings

      about 5 years ago #

      nope, not going to be a natural fit. If it was, it would already have happened, en masse.

      A1. Maybe not cool enough, but the access to resources, scale and budgets is hard to beat. My agency, for example, has quietly been a massive Analytics division (people and tech). Also, agencies can (sometimes) pay a good salary and move you around their network. Don't worry, plenty of agency people believe the grass is greener on the startup side, too. So the traffic won't be all one-way

      A2. The vast majority of marketing 'fails' are invisible - just wasted budget or ineffective tactics. As long as the hacks being proposed don't actually put the brand in visible jeopardy, most organisations would find 'underperformance' an acceptable risk - especially if it's priced right.

      A3. To my understanding, most agency strategy doesn't involve strategy either ;-)

      A4. This is actually the biggest mis-match between the two cultures - very insightful, Siddarth. Growth Hackers will have to be very clear and stick to their guns about the operating environment they will require from their new 'owners'.

  • RE

    Rachel Ergo

    about 5 years ago #

    One way I've been able to apply growth hacking to the digital agency setting is by having the account teams execute their standard processes and methodologies, and then the growth team supports the accounts internally by measuring, optimizing, and identifying new opportunities to increase growth. Still tons of limitations though.

    If you check out the inbound marketing agency community, you'll find many are starting to take more ownership of real growth metrics.

    • BS

      Barrie Seppings

      about 5 years ago #

      That's common sense on a stick, Rachael. Love it.
      Take an aspect or skill from the Growth Hacking kitbag, apply it to a part of an existing process/team/organisation, merchandise the results, earn some trust, ask for a bigger assignment. Rinse and repeat.
      PR divisions of agencies did exactly this with social, and now some are the tail that wag the dog.

  • LR

    Liam Reynolds

    about 5 years ago #

    Interesting article and one that's quite close to my heart as I've been on both sides of this divide.

    Here in the UK, I've noticed that advertising agencies are wising up to Growth Hacking as we get a lot of enquiries from some pretty big players out there.

    What I find interesting about this is that the agency model is (was) typically built on delivering some big creative campaigns for a lot of cash and the idea of any measurement or evaluation usually an after thought, typically picked up by their media agency. Ad agencies are highly commercial animals but usually do what's best for them (creative reputation & revenue) than what's best for their clients. So there's going to be an interesting evolution of their business model if they do adopt the Growth Hacking manifesto and start putting their clients business first!

    The other thing is that over the years, agencies have developed to (some extent) mirror their clients...so very much all the different parts of the business (SEO, CRM, social media, advertising etc) all operating in independent silo's. So structurally, they've still got a long way to go before they genuinely join all the dots together.

  • SE

    Sean Ellis

    about 5 years ago #

    I love that the author of this article is a creative director from Olgilvy. Very interesting to see his perspective.

    • BS

      Barrie Seppings

      about 5 years ago #

      Hey thanks for the linkage Sean!

      From a 'big agency' perspective, Growth Hacking is probably the best articulation I've encountered so far of the 'integration' that agencies have been attempting for some time. They're trying to figure out data, trying to figure out customer experience, and you'd be surprised how many big players are still trying to figure out social, content etc.
      In some cases, they are trying to weigh in on product dev too, but traditionally, they've come at it like consultants (which is where the big money is/was).

      To further refine the prediction, the adoption of Growth Hacking will be not unlike the first wave of ‘digital’ to roll through agencyland, which was repeated when ‘social’ emerged.

      It’s hard to say how it will mature in terms of individuals and their roles, I’d say some (younger) people will just naturally operate as a ‘Growth Hackers’ because it seems like common sense to them.

      Some will adapt because they see merit in the approach and will be able to pick the situations in which it’s most suitable. (I'm most likely going to be here, I reckon.)

      And then some will continue to see it as an on/off tactic & deploy it as such, perhaps making it like a ‘swat team’ or a separate discipline, like digital and social still are in some organisations.

      Any of these approaches could work, depending on what sort of business the Agency ultimately wants to become (or remain). The key is a willingness for the individual to learn and the organisation to experiment.

      • CB

        Chris Bolman

        about 5 years ago #

        Barrie,

        Great points and great article. I think your last point about willingness to experiment is important. There's some pretty significant cultural resistance to the designating "growth hacking" (or it needs to be socialized a lot better). Was just talking to a firm in NYC about this last week who were looking for "growth hacking" help, but when I actually talked to the execution team I'd be collaborating with they were basically like "so are you going to rent a bunch of black hat Siberian linux servers to conduct programmatic espionage on our competitors?" It was pretty palpable that individual career (and at a macro level, brand) safety were paramount, and taking creative risks that might jeopardize either was a show-stopper.

        Those fears aren't going to be put to bed overnight.

        • BS

          Barrie Seppings

          about 5 years ago #

          That would have been a hilarious meeting. There's absolutely a culture of fear in most companies that have marketing budgets big enough to consider hiring an agency. It's the challenger brands or the brands that are in the most trouble that will be prepared to take calculated risks (like when Ford was close to collapsing and made a psuedo-documentary about their attempt at a turnaround).
          One thing I've learned in agency land - you can only help people who actually want to be helped.

  • ET

    Everette Taylor

    about 5 years ago #

    I love the quote by Neil Patel and I'm right there with you in optimism. Absolutely fascinated with the future of Growth Hacking and to think of the possibility of Growth Hackers being employed by fortune 500 companies is encouraging.

    One of the reasons I'm in the startup arena is the flexibility and creativity that it provides as a Growth Hacker, not some of the rigidness and monotony that some bigger companies maintain.

    Great article Barrie.

  • CB

    Chris Bolman

    about 5 years ago #

    This is actually happening (or already starting to). In the past month I've experienced a significant uptick in inbound job inquiries out of NYC from much larger and more mature ad-oriented companies/agencies. It used to just be startups.

  • JC

    Jeffrey Chew

    about 5 years ago #

    great. well thought out and written. thansk Sean..Thanks Barrie

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