Demystifying the Jargon: A Beginner's Guide to Growth Terminologies for SaaS Businesses
Updated: Mar 9
As businesses aim to scale and expand their reach, growth marketing has become a popular strategy. Growth marketing is the process of using marketing and data-driven techniques to acquire and retain customers, increase revenue, and ultimately grow a business. Growth marketing involves using a wide range of tactics and techniques, many of which are rooted in data analysis, experimentation, and automation.
Here are some of the most important growth marketing terminologies that every marketer should know.
A growth framework is a system that guides and measures the effectiveness of growth marketing efforts. A growth framework typically includes a set of principles, strategies, tactics, and metrics that can be used to achieve growth goals. One of the most popular growth frameworks is the "pirate metrics" or AARRR framework, which stands for Acquisition, Activation, Retention, Revenue, and Referral. This framework is useful for businesses that rely on customer acquisition and retention to drive growth.
Growth hacking is a marketing technique that uses creative, low-cost strategies to acquire and retain customers. Growth hacking often involves using social media, content marketing, email marketing, and other digital channels to drive traffic and engagement. Growth hacking is often associated with startups and early-stage businesses that need to rapidly scale their customer base.
A growth loop is a series of actions that a user takes that results in a positive outcome, which then leads to the user repeating the action. In a SaaS context, a growth loop might involve a user signing up for a free trial, receiving value from the product, and then sharing their positive experience with others. This sharing of positive experiences can lead to more users signing up for the free trial and repeating the cycle.
Growth loops are an important part of many successful SaaS businesses, as they can help to drive sustainable growth and revenue.
A growth model is a framework or system that helps businesses to achieve sustainable growth. Growth models provide a structured approach to identifying and implementing growth strategies, and can include frameworks such as the Pirate Metrics (AARRR), the Bullseye Framework, and the Lean Startup Methodology.
The Pirate Metrics (AARRR) framework is a commonly used growth model in the SaaS industry. It includes the following five stages:
Acquisition: attracting new users to the product or service
Activation: getting users to experience the core value of the product or service
Retention: keeping users engaged and returning to the product or service
Revenue: monetizing the product or service through paid features or upgrades
Referral: encouraging satisfied users to recommend the product or service to others
By understanding and applying a growth model like AARRR, SaaS businesses can develop a comprehensive growth strategy and optimize their efforts for maximum impact.
A growth lever is a specific strategy or tactic that a business can use to achieve growth. Growth levers can include initiatives such as improving the onboarding process, optimizing pricing, or launching new features.
Growth levers can be organized into three categories:
Acquisition levers: initiatives that are designed to attract new users to the product or service, such as content marketing, paid advertising, or search engine optimization (SEO).
Activation levers: initiatives that are designed to help new users experience the core value of the product or service, such as improving the onboarding process or providing product tutorials.
Retention levers: initiatives that are designed to keep users engaged and returning to the product or service, such as email marketing, push notifications, or loyalty programs.
By identifying and implementing the most effective growth levers for their business, SaaS companies can achieve sustainable growth and revenue.
Growth motion is the way in which a SaaS business drives growth by leveraging one or more functions of the business, such as sales, product, or marketing. There are three subcategories of growth motion:
Sales-led growth: This approach involves a heavy focus on sales and requires a strong sales team to drive growth. This approach typically involves a high-touch sales process and a focus on large enterprise customers.
Product-led growth: This approach involves leveraging the product itself as a driver of growth. A product-led growth approach focuses on creating a high-quality product that users love and promoting the product through word-of-mouth marketing and virality. Product-led growth often requires a strong product team and a focus on user experience.
Marketing-led growth: This approach involves leveraging marketing channels to drive growth, such as content marketing, paid advertising, and email marketing. Marketing-led growth requires a strong marketing team and a focus on data analysis and optimization.
By understanding and leveraging the most effective growth motion for their business, SaaS companies can achieve sustainable growth and revenue.
"The Definitive Guide to Growth Hacking" by Neil Patel and Bronson Taylor (https://neilpatel.com/what-is-growth-hacking/)
"A Beginner's Guide to Product-Led Growth" by Wes Bush (https://www.productled.com/guides/product-led-growth/)
"The Ultimate Guide to SaaS Customer Acquisition" by Sean Ellis and Ethan Garr (https://growthhackers.com/growth-studies/ultimate-guide-saas-customer-acquisition)
"The Bullseye Framework for Finding the Most Effective Channel for Your Business" by Justin Mares and Gabriel Weinberg (https://www.gabrielweinberg.com/blog/the-bullseye-framework-for-finding-the-most-effective-channel-for-your-business)
"The Lean Startup Methodology" by Eric Ries (https://www.startupgrind.com/blog/the-lean-startup-methodology/)
"The Top 10 SaaS Metrics for High-Growth Companies" by Tomasz Tunguz (https://tomasztunguz.com/top10/)
"What Is Growth Motion?" by Jeremy Shearer (https://www.chargify.com/blog/what-is-growth-motion/)