In the sixth and last part of this series on growth hacking, we’re finally going to talk about the magic word that every small business owner and startup founder likes to hear: revenue.
Turning engaged, acquired visitors into paying customers is the core of what keeps any business alive. It’s also, unsurprisingly, the hardest part of the funnel to get right. People will sign up for a lot of things as long as the content remains free; getting them to pay for something, especially on a repeating or continuing basis, can be tricky.
Establishing a consistent and growing stream of revenue is challenging for a couple of reasons. One is obvious: there’s a big difference between getting customers to explore your services and products and say nice things about what you do, versus getting them to pull the trigger and actually spend some of their hard-earned money. The second reason is more about your own mindset as an entrepreneur, especially if you’re under a lot of financial pressure to get the ball rolling. Businesses can get so hung up on the idea of wanting to push people to buy things, that the other steps get put on the back burner. The trick is to find a balance – sales are important, of course, but the key here is to drive those sales by using all six steps as a comprehensive system.
This is why revenue is the last step in the Pirate Funnel system – it’s essential that you fight the urge to put it first. It’s only by building a strong foundation through all the other steps that consistently-accumulating revenue becomes possible.
In other words, it’s not just about getting people to spend money as a one-off to help with your initial cashflow panic. The whole point of the AAARRR funnel is that it keeps it keeps paying customers coming back, staying loyal, and encouraging their friends to hop on board.
There are three main things to remember when you’re fine-tuning this last part of the process:
1. Keep increasing value. Even if you’re offering a very popular product or service, if it stays exactly the same for too long, people will grow bored and frustrated with it. Listen to what your customers are telling you they want, and turn their feedback into a plan for improvements, new products, or more comprehensive service features. In order for people to keep wanting to pay you, they have to feel like they’re always getting their money’s worth and then some.
2. Don’t be afraid to try things. Test, analyze, adjust, repeat. Every time you try something new, measure what kind of a difference it’s making. If you’re having trouble getting monthly subscribers to renew, you can try offering a discount if they sign up for annual billing. If you’re sending out physical products, try a pricing structure that includes free shipping to see if that helps reduce cart abandonment.
3. Keep your eyes on the road. When money finally starts coming in at a decent pace, you might feel inclined to breathe a sigh of relief and coast for a while. Don’t give in to this temptation – the whole point of growth hacking is to build momentum, so when you do start seeing revenue, that’s the time to push forward even more eagerly, and see just how far you can go.
The most important thing to remember is that successful, long-term growth requires commitment. It’s great to have a formula to help you build things up quickly, but in order to sustain what you’ve built, you need to stay on top of the process. The AAARRR growth hacking funnel is not a magic route to success, but for those who are willing to put in the time and effort, it can be an incredibly effective way to go from fledgling startup to flourishing business in a remarkably short period of time.