If you are new to the world of growth, you might not have heard about martech or growth stacks before. That is okay, but no matter if you are in product or in marketing, you should change that fact. Let me tell you a bit about it from my personal experience.
While growth stacks have been around for a very long time, we have not necessarily called them that in the past. It is essentially a set of SaaS tools working together to help you analyze your customer’s behavior, acquire new customers, and communicate with your customers in the optimal way.
📊 For many people in product, their first experience with growth stacks are product analytics and experimentation tools that allow them to understand their customers’ journey, measure their core metrics (e.g. around activation and retention), and run A/B tests. Product managers may also run user surveys and user interviews, or send transactional messages (email, push, SMS) related to the product experience.
↔️ Ideally all of these tools are interconnected so that I can e.g. use my product analytics tool to create and sync cohorts with my messaging and survey tool, and vice versa see messaging results in my analytics tool. This is where a CDP (Customer Data Platform) comes into play. A CDP essentially provides a persistent and unified view on each customer profile that is accessible to other systems; as such it routes and syncs data of all systems with each other, allowing you to create a more and more personalized experience for your customers.
📢 What about marketing? You guessed right. They have a great need for the growth stack which is not coincidentally also commonly referred to as martech (marketing tech). It helps them attribute advertisement spend, craft personalized messages, design and experiment with personalized as, and ultimately optimize their marketing spend.
Now that we have settled that there is something in it for everyone, I will provide more information about the growth stack’s main advantages and how to get started.
It fascinates me how many companies have little to no martech or growth stack. To add to that fascination, some of these companies are running very successful businesses 🤑 Now imagine what these companies could achieve if they would start using a growth stack…
🤝 Having a growth stack in place facilitates communication between your product, engineering, and marketing teams, and also helps establish a common language.
↔️ Thinking of your tools as a stack opposed to single tools, will help you understand relationships in your data you might not have uncovered otherwise.
🕵️ Analyzing your customer behavior allows product managers to build a better product. Among others, Product is now quicker in understanding user behavior and building hypotheses, and prioritizes work based on data and not solely gut-feeling. All of this ultimately increases conversion and boosts retention.
💸 Being able to attribute ad spend allows Marketing to optimize their spend, and scale the most successful channels and campaigns.
📈 Scaling your business will be much easier. Sync data through your CDP so that you can personalize experiences for your customers from acquisition and onboarding to ongoing product usage.
🤳 Your teams also gain agility by being able to self-serve (e.g. create new campaigns, create new analyses). And despite self-serving, it allows spending more time on creative tasks as more time-consuming tasks are automated.
👉 I have only touched certain aspects of a growth stack’s advantages. Each tool you add to the growth stack will add another layer of insights; think about how CRM and messaging benefits from data from product analytics or user surveys, or how adding software to take care of your subscription pricing will reduce manual work and provide insights into your predicted LTV that will in turn help identify your most profitable acquisition channels.
Now that you have heard about martech and growth stacks, and know their benefits, let us take a look at how to get started with your own martech or growth stack. Let me guide you how I would get started and why 👇
1️. In my opinion, the best way to get started is by setting up a product analytics tool. Why? Because it provides immediate insights to your product and marketing teams. It helps them build a common language, work towards the same goals, track metrics, understand user behavior, and ultimately move towards data-driven decision making. 🤔 But setting up a data taxonomy and tracking events is a lot of work and an incredibly cumbersome burden, isn't it? Yes and no. You can start small, get your first wins, and then gradually expand. For instance, you might start by tracking only the onboarding and activation funnel or even just parts of it. Without too many efforts, your team sees what works well and what does not, adjusts the process, and continues tracking further events to gain more insights apart from onboarding conversion rates.
2️. With product analytics alone, you may manage to change your company culture slowly but steadily. Once your product analytics are somewhat settled, and you have built up an appetite for more sophisticated use cases, it is time to think about your CDP (customer data platform). The CDP will serve as your basis for further integrations. It provides a persistent and unified view on each customer profile syncing data of all your tools with each other. Why is it so important? Because you want to avoid having a Frankenstein system where your tools use different data taxonomies and while some tools may talk to each other, some don't. 🎬 Once you have your CDP and product analytics set up, it is show time. You are now ready to expand into the vast field of growth stack tools. Depending on your priorities, the next tool to add to your growth stack will differ. I will write about a few possible paths in the near future.
Your growth stack consists of a CDP and product analytics tool? Great, you’re probably already much further than many of your competitors out there! If you want to do even better, have a look at some of the possible paths you can take now 👇
📧 Messaging and CRM: many will argue that CRM is a must have in your tool box. No matter if it is transactional or promotional messages, you will nearly always have a need for communicating with your customers via email, push, in-app or SMS. If you cannot come up with a use case, think again. And then implement the tool of your choice for automating and personalizing your messages as much as possible
❓ User interviews and surveys: adding surveys to your growth stack is a simple yet effective addition. You can use your product analytics tool to create cohorts that you want to survey. For example, you only want to pop up a short question to users from a defined country who performed a certain core action more than x times last week.
🧭 Marketing spend attribution: in particular in the mobile world, attributing ad spend to your users continues becoming tougher and tougher. Attribution platforms can help you gain some clarity into what channels and campaigns are performing better than others. By attributing your ad spend not only to high-level metrics such as installs but rather to in-app purchases, you will be scaling the right campaigns. You may also decide to send lookalike audiences of your favorite customers (defined in your product analytics tool) to your ad platforms through your attribution platform of choice.
🧪 Experimentation: are you having a hypothesis that a revised onboarding flow could increase your conversion rates? Run an A/B test instead of assigning all of your traffic to the new variant and then having a hard time evaluating whether it improved the conversion rates and avoid discussions around whether it worked or not. While you set up feature flags in your experimentation tool, you use your existing product analytics tool for evaluating the impact of the experiment. Fingers crossed that you hit that statistical significance 🤞
👉 While the above covers the most common scenarios, it does not describe all possibilities; there are simply too many to put in one article. If you need help setting up your growth stack, feel free to reach out.
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