Growth Loops

Intro

Growth loops are when you take an output of your product and repurpose it as an input acquisition channel (where people put their attention).

Examples

User-generated content (Reddit)
  1. You search for cat pictures on Google [input - SEO]
  2. You click the top Reddit post for cat pictures
  3. You go "Reddit is cool!"
  4. You sign up for Reddit
  5. You post your dog pictures [output - content that ranks]
  6. Those dog pictures rank on Google [input]
  7. New people search for dog pictures and find your post
Inherent Referral (Box)
  1. You get an email that a client shared a Box file with you [input - your email inbox]
  2. You make a Box account to access it
  3. You go "Box is better than [my old way of sharing files]!"
  4. You share files with an agency on Box [output - agency's email address]
  5. Your agency contact gets an email [input] that you shared a file with them
Branded clothing (Livestrong bracelets)
  1. You see someone wearing a yellow bracelet that says "Livestrong" [input - people walking by you]
  2. You go, "That looks cool!"
  3. You google Livestrong (or ask a friend what it means)
  4. You buy a bracelet on the site and wear it around town [output - bracelet with a unique word]
  5. Someone else sees you [input] wearing the bracelet
More examples (most of these are OK but not great)

Funnels vs. Loops

Here’s a traditional marketing “funnel”. It’s a simplified version of the buyer’s journey.

image

It’s a very linear way to get customers. You pour people in the top of the funnel, they move through it, and get ejected at the other end. Sort of like a factory line: get ‘em in, get ‘em through, get ‘em out.

In contrast, growth loops feed back into themselves.

image

Why are growth loops so powerful? They compound. One user becomes two, two become four, four become eight, etc. It’s sweet, sweet, exponential growth. (That elusive thing Silicon Valley hypebeasts are always talking about.)

Aside from the obvious benefit (more users), you can also afford to spend more to get users because each user now brings in many more. For example, if ads weren’t profitable in the past, they may be profitable now that you have a growth loop.

When we first work with company, we try to figure out the existing loops — the fire we can pour gas on.

If we can’t think of any, we move to brainstorming potential growth loops that might work for them. This is a much, much harder problem. But the payoffs are big.

Without clear growth loops, it’s hard to scale to more and more users. You have to invest a ton of money and effort to, e.g., optimize ads or write content. But with growth loops, all the work is done for you, and in most cases, users come for free.

How do I come up with growth loops?

#1: Think about all the outputs of your product.

Examples:

  1. Do people complete a quiz to sign up?
  2. Do experts respond to questions as part of your product?
  3. Do users create posts?
  4. Do people join video sessions as part of your product?
  5. Do people naturally talk about you after they use you?

#2: Map those outputs to inputs.

Continuing the examples above. (Inputs are in green, outputs are in blue.)

  1. Automatically send quiz data and unique quiz answers to journalists through email.
    • Automatically ship people a branded poster they can show off to friends in their living room with the inspirational quote they chose in their quiz.
  2. Monitor Twitter and Reddit for people asking common questions about gardening, then post relevant responses from your gardening experts that link back to your site.
    • Hire a VA to clip expert responses, transcribe them with Rev.ai, and post the video + transcript on their own unique pages on your site — titled with the question being asked. Wait for them to rank in Google searches.
  3. Hire an intern to filter for the most eye-popping posts your users make every week and share them on Twitter, Linkedin, and relevant subreddits.
    • Make posts publicly viewable so they rank in Google searches.
  4. Clip the videos into 15 second - 1 minute snackable pieces of content and automatically post them to Instagram and Tiktok.

Some products don't have a natural growth loop and that's OK. Don’t force them. For example, if you’re selling supply chain software, don't force your users to tweet about you. That’s not why they tweet, and it’s a recipe for bad reviews and worse conversion rates.