What lies next for the Growth Hacker?

The Growth Hacker is constantly on top of the return-to-effort ratio of the channel they are experimenting with. For this, they implement data collection techniques (using tools like Google Analytics, MixPanel) to know how many people visited the product via the channel and how many of them completed the desired behavior (“converted”). They calculate average cost involved in successfully getting a converted user (“CAC”, customer acquisition cost) and long term value (“LTV”) obtained from the converted user. For a channel to be feasible in long run, LTV should be greater than CAC by few multiples (each product vertical has their own thumb rule of what the multiple should be like).

Eventually, optimization on a channel saturates to its natural limit. An experienced Growth Hacker will have an intuitive understanding of when the channel starts hitting the limit. Also, as knowledge about a new channel becomes mainstream, more Growth Hackers try to utilize the channel. This further saturates the channel as well as increases cost of using the channel for all. A Growth Hacker will make a judged call of which point on the channel’s adoption curve they are on and keep looking for next opportunity which presents itself.

Ultimately, the product has to stand on its own feet. The direct traffic to the product should hold its own and allow the Growth Hacker to utilize that to reach out to new potential users. The product should be great at solving the user’s need and be compelling enough to make the user form a habit of using the product. The Growth Hacker helps the product to be known to early adopters, but the success of the product is equally dependent on how useful those early adopters find the product.