How do you lower the CPA by 100% but still get a 500% increase in marketing ROI? Maybe… Growth Hack.

This is a great blog about how you can grow your start up. It’s very relevant for me as just starting work for JusTaxi a mobile app start up that get the best price for taxi’s in Manchester, as they needed a 100% decrease in their cost per acquisition and a 500% increase in the number of downloads they were getting.

For the record, in our new app download for getting the best taxi price in Manchester, we are using one of the techniques below. You will have to download the JusTaxi app yourself, to find out which one.

As The Next Web report – “Startups are a special breed of companies when it comes to marketing. If a big corporation is pushing a new product, you might expect them to take out TV ads, online ads, maybe hire a PR agency and set up big distribution partnerships.

Most startups however, don’t have the kind of money required to do that. So what do startups do? Rely on cheaper forms of marketing: Blogging, email, viral tactics etc.”

As a start up business advertising and a specialist in digital guerrilla marketing for over 10 years I have been teaching start ups some of these low cost high impact marketing tactics. But you will be amazed how many still are not used effectively.

The Next Web take this idea of effectiveness even further with ‘Growth Hacks’ (itsefl a clever way of rebranding an old terminology – which IS  another #greatmarketing tactic)

“Growth hacks are clever marketing tricks used by startups in order to get more users (often for free or very little cost). Sometimes they are simple, sometimes they are quite technical – but what they have in common is that they can be highly effective.

Here are five of the most famous growth hacks of all time.

1. The Little Bighorn

What is this? If your target market is difficult to reach, instead of tackling it head on, go after an adjacent market in order to stimulate demand.

Why do I know this? This tactic was made famous by Facebook.

Back when Facebook was still just for schools, some schools already had their own social networks. Instead of trying to market directly to students at those schools (“but we already have a social network!”) Facebook targeted schools in the vicinity, which would inevitably be home to friends of the target school’s students.

Once all your friends were on Facebook and you’re the last one left standing… it’s kind of hard to say no!

Why does it work? Joining something because your friends are on it or because they said it’s cool is called “social proof.” Social proof is one of the most powerful elemental forces of the internet, at your disposal. Use it wisely!

2. The Waiting List

What is this? Instead of letting users sign up and start using your service immediately, put them into a waiting list which you slowly work through.

Why do I know this? This tactic was made famous by Mailbox. After downloading the Mailbox app you’d be told exactly which number you were in the queue (inevitably some crazy high number).

Why does it work? It’s another form of social proof, that lots of other people are waiting to “try” an app. Mailbox was lucky in that this growth hack generated the company a lot of press and a cult of followers. It must have done something right because even before officially launching, Mailbox was acquired by Dropbox for an alleged $100 million.

3. The Cross Post

What is this? A feature on your app allows a user to post to one of their existing social networks, usually with a line that credits your app in some way. For example, perhaps announcing to the world how you “Just saved money with JusTaxi – the free taxi fare comparison app

Why do I know this? Airbnb and Instagram popularised this growth hack.

Airbnb had an early feature that allowed users to post their listings to Craigslist, taking advantage of Craiglist’s massive scale. Instagram encouraged users to post to Twitter and Facebook by making cross-posting a big part of the user journey when uploading a photo.

Why does it work? Getting your app’s content posted through a major distribution channel exposes more people to your app and results in more users trying your app out. Instagram ended up disrupting Facebook’s own photo sharing feature so much that Facebook acquired them for $1 billion.

4. The By The Way

What is this? Probably all over your site and blog you’ve got pages branded with your name and logo. That makes sense. But take it one step further and put the same thing at the bottom of content your users create.

Why do I know this? This tactic was made famous by Hotmail.

At the bottom of every email Hotmail sent out was a message saying “get your free email account now!” At a time in history where people were paying their ISPs for email accounts, Hotmail’s offer was an attractive one.

Why does it work? You are getting your users to advertise your service for you to their friends. And the best part? It scales infinitely and doesn’t cost you anything.

5. The Back Scratch

What is this? Incentivise users to invite their friends by offering a 2-way reward. A reward for the friend who gets invited, and a reward for the person who did the inviting. I think we will have to do this with Justaxi – perhaps giving people points or money off when they post on Facebook – what do you think?

Why do I know this? PayPal famously offered a $20 2-way reward in their early stages of growth. If you successfully referred a friend you would get $10 and your friend would get $10.

PayPal grew to tens of millions of users before ending this promotion, but you can probably name at least three companies off the top of your head that offer something similar.

Why does it work? Users like free money, whodathunk!

Of course, this growth hack is expensive to pull off. But compared to other paid acquisition channels such as PPC, a referral program like this can require less ongoing maintenance and result in more high quality users.”

It’s interesting to see this – as before I came to the company as marketing manager – Justaxi tried to use a printed press advertising campaign with a promo code – and very very few people used it. To be honest with you I know why and it is not a mistake we will make again. We are now advertising through twitter and mobile, for our geo location taxi comparison app for Manchester, sometimes with a promotion code, and guess what our cost per acquisition has come down 500% …. now next I have to get our downloads up by the same percentage. Nobody said it be easy!

But I think that perhaps with a cunning cross post – coming from inside the app – we may have a chance.


And perhaps if we had on Jon Yongfook (the guy who wrote most of this article) as our mentor – as he is a serial entrepreneur based in Asia. He started and sold a popular recipe portal, and now runs a virtual assistant software company. He mentors young startups at Singapore Management University and True Incube Thailand, a 500 Startups Partner.