case study growth strategy

Growth Strategy

In case interviews , you are often tasked with developing strategies to increase a company's revenue . It's crucial to conduct a systematic analysis to provide well-founded and actionable recommendations .

🔎 Below, you'll find essential factors to consider and how to structure your response clearly and precisely. Our goal is to provide you with a practical guide to help you succeed in case interviews and develop compelling growth strategies.

Key Factors for Revenue Growth

When developing growth strategies, the focus can vary. Here are some key factors to consider:

• Product Mix : Analyze the product range and its life cycles .

Example: A company selling clothing might expand its range to include sportswear in order to reach a broader target audience and create additional revenue streams.

• Market Growth : Examine the industry ’s growth rate.

Example: If the market for sustainable fashion is growing, a company specializing in sustainable products could increase its market share through targeted expansion.

• Customer Satisfaction : Consider how satisfied customers are with the products.

Example: A smartphone manufacturer could gain valuable insights through regular customer satisfaction surveys and make product improvements to strengthen customer loyalty.

• Price Comparison : Compare prices with those of competitors.

Example: An electronics manufacturer might compare its prices with those of competing brands to remain competitive and adjust pricing strategies .

• Price Sensitivity : Determine how sensitive customers are to price changes.

Example: A luxury goods manufacturer could study how price changes affect demand for its products to optimize price adjustments and refine its pricing strategy.

• Marketing Strategies : Assess the effectiveness of current marketing channels.

Example: An online retailer might increase its reach and boost sales through targeted social media campaigns and influencer marketing.

• Competitor Analysis : Analyze competitors' marketing strategies.

Example: A food manufacturer could analyze competitors’ advertising strategies and stand out with innovative marketing ideas to gain market share.

• Available Resources : Review the budget for growth initiatives.

Example: A start-up might assess how much budget is available for product development and marketing to plan targeted investments in growth initiatives.

• Shareholder Expectations : Consider shareholders' expectations.

Example: A publicly traded company might develop strategic measures to meet shareholder expectations for revenue growth and profitability , thereby strengthening investor confidence.

Main Approaches to Revenue Growth

There are two primary approaches to revenue growth: organic and inorganic.

• Organic Growth involves expanding distribution channels to reach new sales avenues and entering new geographic or demographic markets. This includes launching targeted marketing campaigns, optimizing existing ones, broadening product lines by introducing new products, and enhancing customer retention through stronger relationships and loyalty.
• Inorganic Growth focuses on mergers and acquisitions. This approach involves acquiring other companies to quickly integrate new markets or products and forming partnerships to leverage synergies and accelerate growth.

Conclusion: Successful Growth Strategies for Consulting Cases

In case interviews, it's crucial to identify the right growth strategies . A detailed analysis of products, pricing, marketing activities, and financial resources will help you effectively utilize both organic and inorganic growth approaches. With a structured and well-founded approach, you can present convincing and actionable solutions. Good luck with your case interview preparation!

In our Case Library , you'll find not only case studies on growth strategy but also numerous other relevant topics such as market analysis , market entry , restructuring , and much more. Why not take a look inside? 🚀

Do you have a question about growth strategy cases that we haven't covered in the article yet? No problem! Just ask our experienced coaches in our Consulting Q&A .

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Hacking the Case Interview

Case interview frameworks or consulting frameworks are arguably the most critical component of a case interview. Outstanding case frameworks   set you up for success for the case while poor frameworks make the case difficult to solve.

Struggling on how to use frameworks in your case interviews? Unsure of which frameworks to use?

Don't worry because we have you covered! We'll teach you step-by-step, how to craft tailored and unique frameworks for any case interview situation.

By the end of this article, you will learn four different strategies on how to create unique and tailored frameworks for any case interview.

Strategy #1: Creating Frameworks from Scratch

• Strategy #2: Memorizing 8 – 10 Broad Business Areas
• Strategy #3: Breaking Down Stakeholders
• Strategy #4: Breaking Down Processes
• Strategy #5: Two-Part MECE Frameworks

You will apply these strategies to learn how to create case frameworks for the six most common types of case interviews.

Profitability Framework

Market entry framework, merger and acquisition framework, pricing framework, new product framework, market sizing framework.

You will also learn six consulting frameworks that nearly every consultant knows.

Porter’s Five Forces Framework

Swot framework, 4 p’s framework, 3 c’s / business situation framework, bcg 2x2 matrix framework, mckinsey 7s framework.

If you’re looking for a step-by-step shortcut to learn case interviews quickly, enroll in our case interview course . These insider strategies from a former Bain interviewer helped 30,000+ land consulting offers while saving hundreds of hours of prep time.

What is a Case Interview Framework?

A case interview framework is simply a tool that helps you structure and break down complex problems into simpler, smaller components. Think of a framework as brainstorming different ideas and organizing them into different categories.

Let’s look at an example: Coca-Cola is a large manufacturer and retailer of non-alcoholic beverages, such as sodas, juices, sports drinks, and teas. They are looking to grow and are considering entering the beer market in the United States. Should they enter?

In order for you to decide whether Coca-Cola should enter the beer market, you likely have many different questions you’d like to ask:

• Does Coca-Cola know how to produce beer?
• Would people buy beer made by Coca-Cola?
• Where would Coca-Cola sell its beer?
• How much would it cost to enter the beer market?
• Will Coca-Cola be profitable from selling beer?
• How would Coca-Cola outcompete competitors?
• What is the size of the beer market in the United States?

This is not a very structured way of thinking through the case. The questions are listed in no particular order. Additionally, many of the questions are similar to one another and could be grouped together.

A case framework would provide a structure to organize these ideas and questions in a way that is easy to understand.

A framework for this case might look like the following.

Notice that we have simplified the list of questions we had into four main categories. These broad categories are frequently called framework “buckets.” Also notice that we have grouped similar questions together under each framework bucket.

This case framework tells us what areas we need to explore in order to make a recommendation to Coca-Cola. It also clearly shows what questions we need to answer under each area.

This is the power of a case interview framework. It simplifies a complex business problem into smaller and separate components that we can tackle one at a time.

So how do you develop a case framework? The next section will reveal four robust strategies for creating unique and tailored consulting frameworks for any case interview.

Case Interview Framework Strategies

There are four case interview framework strategies you should have in your toolkit:  

When given a case interview, you will need to decide which framework strategy you want to use. Some framework strategies will be more effective than others depending on what type of case interview you get.

Therefore, choose the case framework strategy that is easiest for you given the type of case that you get.

This case framework strategy can be used for any type of case. This is the most time-consuming strategy, but yields case frameworks that are the most tailored and unique for the given case interview.

To create a framework from scratch, ask yourself what 3 – 4 statements must be true for you to be 100% confident in your recommendation. These 3 – 4 areas will become the buckets in your framework.

Once you have your framework buckets, brainstorm a few questions for each bucket that you need answers to.

Let’s return to the Coca-Cola case example in which we are asked to determine whether or not they should enter the beer market. What 3 – 4 statements must be true for us to recommend that Coca-Cola should enter the beer market?

The four major statements that must be true are:

• The beer market is an attractive market
• Competitors in the market are weak
• Coca-Cola has the capabilities to produce outstanding beer
• Coca-Cola will be highly profitable from entering the beer market

These will be the major areas or buckets in our framework.

Next, let’s add a few bullet points under each area to add more detail to our case framework.

To determine whether the beer market is attractive, we would need to know the market size, the market growth rate, and the average profit margins in the market.

To assess whether the market is competitive, we would need to know who the competitors are, how much market share they have, and if they have any differentiation or competitive advantages.

To decide whether Coca-Cola has the capabilities to produce beer, we need to know if there are any capability gaps or if there are significant synergies that Coca-Cola can leverage.

Finally, to determine the expected profitability of entering the market, we would need to know what expected revenues are, what expected costs are, and how long it would take Coca-Cola to break even.

This gives us our case framework.

You can repeat this process for any case interview that you get to create an outstanding case framework.

Strategy #2: Memorizing 8 – 10 Broad Business Areas to Make a Framework

Creating case frameworks from scratch can be quite time-consuming. Because of this, many interview candidates make the mistake of using memorized frameworks for case interviews.

Candidates will either use a single memorized framework for every case or memorize a different framework for every type of case interview.

The issue with using memorized frameworks is that they aren’t tailored to the specific case you are solving for. When given an atypical business problem, your framework areas or buckets will not be entirely relevant.

A poor framework makes the case interview significantly more difficult to solve.

Additionally, Interviewers can easily tell that you are regurgitating memorized information and not thinking critically.

Instead of creating frameworks from scratch each time, this second case framework strategy provides a method to speed up the process while still creating frameworks that are unique and tailored to the case. Additionally, you won’t need to memorize multiple different frameworks.

First, memorize a list of 8 - 10 broad business areas, such as the following:

When given a case, mentally run through this list and pick the 3 - 5 areas that are most relevant to the case.

This will be your framework.

If the list does not give you enough areas for your framework, brainstorm and add your own ideas as areas to your framework.

Finally, add a few bullet points under each area to add more detail to your case framework.

This strategy guarantees that your framework elements are relevant to the case. It also demonstrates that you can create unique, tailored frameworks for every business problem.

Let’s return to the Coca-Cola case example in which we are asked to determine whether or not they should enter the beer market.

Running through our list of memorized framework areas, the following six areas would be relevant:

• Market attractiveness : Is the beer market attractive?
• Competitive landscape : How tough is competition?
• Company capabilities : Does Coca-Cola have the capabilities to enter the market?
• Profitability : Will Coca-Cola be profitable from entering the market?
• Risks : What are the risks of entering the market?
• Strategic alternatives : Are there other more attractive markets Coca-Cola should enter?

You can pick 3 – 5 of these areas as the basis for your framework.

This strategy is a shortcut for creating unique and tailored frameworks for every business problem. Even if you and a friend used this same strategy, you both may end up with different frameworks.

That is completely fine. As long as the buckets in your framework are major areas and are relevant to the case, your case framework will be significantly better than most candidates’ frameworks.

You do not need to develop a framework entirely from scratch every time to create outstanding case frameworks. This case framework strategy can be applied to over 90% of case interviews.

For the remaining 10% of case interviews, you will need to learn and use the next two case interview framework strategies.

Strategy #3: Breaking Down Stakeholders to Make a Framework

The first two case framework strategies can be applied to over 90% of cases. However, some cases may require you to identify and focus on various stakeholders that are involved in running or operating a business.

For these cases, the primary areas of your case framework will be these major stakeholders.

Let’s take a look at an example: Your client is a non-profit blood bank. They have volunteer nurses that go to schools and companies to collect blood from donors. They then sell this blood to hospitals, which use this blood for emergency situations when a blood transfusion is required. Currently, Hearts4Lives is not profitable because they are not able to collect enough blood to sell to their hospital partners. What can they do to fix this?

This case involves many different stakeholders:

• Volunteer nurses
• Blood donors
• Schools and companies

For cases in which many different stakeholders are involved, it will be useful to look at each stakeholder and determine what each could do to address the problem.

One potential framework could look like the following:

Strategy #4: Breaking Down Processes to make a Framework

Similar to the previous case framework strategy, some cases may require you to focus on improving or optimizing a particular process.

For these cases, the primary areas of your case framework will be each major step of the process.

Let’s take a look at an example: Your client is a waste disposal company that manages a fleet of drivers and garbage trucks that go to residential homes, collect garbage, and then dump the garbage in city landfills. They have an obligation to collect each home’s garbage once a week. Recently, they have been failing to meet this requirement and are backed up with garbage disposal requests. What is causing this issue and what should they do to fix it?

For cases involving processes and efficiencies, it can be helpful to look at the different components or steps in the process.

We can think about the process of collecting and disposing of garbage in the following steps:

• Get in a garbage truck
• Drive along a designated route
• Collect garbage at each stop
• Dispose of the garbage in the landfill

Using these steps as the primary areas of our framework, we can create the following case framework:

Once you have systematically listed all of the steps in a process, you can identify the pain points or bottlenecks that are causing the issue and determine ways to improve the process.

Strategy #5: Two-part MECE Frameworks

An easy way to make a 100% MECE framework is to use a two-part MECE framework. For the first step, start with a X and Not X framework. Some examples include:

• Internal / external
• Short-term / long-term
• Economic / non-economic
• Quantitative / qualitative
• Direct / indirect
• Supply-side / demand-side
• Upside / downside
• Benefits / cost

There are probably hundreds more frameworks that follow this pattern.

These frameworks are by definition 100% MECE. Since all of these frameworks are X or Not-X, they are mutually exclusive. There is no redundancy or overlap between X and Not-X.

Together, X and Not-X are also completely exhaustive. They cover the universe of all ideas and possibilities.

The X and Not-X framework by itself is good enough for a lot of the questions you could get asked in a case interview.

If you’re asked to brainstorm ways to decrease costs, you can create a framework consisting of decreasing variable costs and decreasing non-variable costs, also known as fixed costs.

If you’re asked to brainstorm barriers to entry, you can create a framework consisting of economic barriers to entry, such as cash and equipment, and non-economic barriers to entry, such as brand name or distribution channels.

However, to take your framework to the next level and truly impress your interviewer, we have the option of doing step two.

Step two involves adding another layer of X and Not X into your framework. What do we mean by this?

Let’s say you are trying to help a city decide whether they should host the upcoming summer Olympics. You start off with a framework consisting of benefits and costs. You can take this framework to the next level by adding another layer, such as adding in short-term and long-term.

With this additional layer, your framework now has four categories: short-term benefits, long-term benefits, short-term costs, and long-term costs. This is a 100% MECE framework that enables you to think through all possible considerations in deciding whether a city should host the Olympics.

Let’s look at another example. Suppose you are trying to figure out how to reduce a company’s costs. You start with a framework consisting of variable costs and fixed costs. You can take this framework to the next level by adding another layer, such as direct and indirect.

With this additional layer, your framework now has four categories: ways to directly reduce variable costs, ways to indirectly reduce variable costs, ways to directly reduce fixed costs, and ways to indirectly reduce fixed costs. This is another 100% MECE framework.

Case Frameworks: The 6 Most Common Frameworks

There are six common case frameworks in consulting case interviews.  

Profitability frameworks are the most common types of frameworks you’ll likely use in consulting first round interviews.

A profitability case might look like this: “An electric car manufacturer has recently been experiencing a decline in profits. What should they do?”

There are two steps to solving a profitability case.

First, you need to understand quantitatively, what is the driver causing the decline in profits?

You should know the following basic profit formulas.

Is the decline in profitability due to a decline in revenue, an increase in costs, or both?

On the revenue side, what is causing the decline? Is it from a decrease in quantity of units sold? If so, is the decrease concentrated in a particular product line, geography, or customer segment?

Or is the decline due to a decrease in price? Are we selling products at a lower price? Is there a sales mix change? In other words, are we selling more low-priced products and fewer high-priced products?

On the cost side, what is causing the increase in costs? Is it from an increase in variable costs? If so, which cost elements have gone up?

Or is the increase in costs due to an increase in fixed costs? If so, which fixed costs have gone up?

Next, you need to understand qualitatively, what factors are driving the decline in profitability that you identified in the previous step.

Looking at customers, have customer needs or preferences changed? Have their purchasing habits or behaviors changed? Have their perceptions of the company changed?

Looking at competitors, have new players entered the market? Have existing competitors made any recent strategic moves? Are competitors also experiencing a decline in profitability?

Looking at the market, are there any market trends that we should be aware of? For example, are there new technology or regulatory changes? How do these trends impact profitability?

Putting all of this together, we get the following profitability framework.

Once you have gone through this profitability framework and understand both quantitatively what is causing the decline in profits and qualitatively why this is happening, you can begin brainstorming ideas to address the profitability issue.

Among the ideas that you brainstorm, you can prioritize which recommendations to focus on based on the level of impact and ease of implementation.

See the video below for an example of how to solve a profitability case using this profitability framework.

Market entry frameworks are the second most common types of frameworks you’ll likely use in consulting first round interviews.

A market entry case might look like this: “Coca-Cola is considering entering the beer market in the United States. Should they enter?”

To create a market entry framework, there are typically four statements that need to be true in order for you to recommend entering the market:

• The market is attractive
• Competition is weak
• The company has the capabilities to enter
• The company will be highly profitable from entering the market

These statements form the foundation of our market entry framework.

Note the logical order of the buckets in the framework.

We first want to determine whether the market is attractive. Then, we need to check if competition is weak and if there is an opportunity to capture meaningful market share.

If these two conditions are true, then we need to confirm that the company actually has the capabilities to enter the market.

Finally, even if the company has the capabilities to enter the market, we need to verify that they will be profitable from entering.

This is a logical progression that your market entry framework will take you through to develop a recommendation for market entry cases.

Merger and acquisition frameworks are also common frameworks you’ll use in consulting interviews.

There are two common business situations.

The first situation is a company looking to acquire another company in order to access a new market, access new customers, or to grow its revenues and profits.

Another situation is a private equity company looking to acquire a company as an investment. Their goal is to then grow the business using their operational expertise and then sell the company years later for a high return on investment. This type of case interview is called a private equity case interview .

In either of these situations, mergers and acquisition cases typically involve acquiring an attractive, successful company.

It is rare to get a case in which a company or private equity firm is looking to acquire a poorly performing company to purchase at a discount. Nevertheless, you can always clarify the goal of the merger or acquisition with the interviewer before beginning the case.

In order to recommend making an acquisition, four statements need to be true.  

• The market that the acquisition target is in is attractive
• The acquisition target is an attractive company
• The acquisition generates meaningful synergies
• The acquisition target is at a great price and will generate high returns on investment

These statements become the basis of our merger and acquisition framework.

Synergies is an area that should absolutely be included in any merger or acquisition framework. A merger or acquisition can lead to revenue synergies and cost synergies.

Revenue synergies include:

• Having access to new customer segments
• Having access to new markets
• Having access to new distribution channels
• Cross-selling opportunities
• Up-selling opportunities

Cost synergies include:

• Eliminating cost redundancies
• Consolidating functions or groups
• Increasing buying power with suppliers, manufacturers, distributors, or retailers

Pricing frameworks are used in cases involving the pricing of a product or service. To develop a pricing framework, you should be familiar with the three different ways to price a product or service.

• Pricing based on costs : set a price by applying a profit margin on the total costs to produce or deliver the product or service
• Pricing based on competition : set a price based on what competitors are charging for products similar to yours
• Pricing based on value added : set a price by quantifying the benefits that the product provides customers

Your answer to pricing cases will likely involve a mix of all three of these pricing strategies.

Your pricing framework will look something like the following.

Pricing based on costs will determine the minimum price you can realistically set. Pricing based on value added will determine the maximum possible price. Pricing based on competition will determine which price in between these two price points you should set.

In order to get customers to purchase your product, the difference between your price point and the customer’s maximum willingness to pay must be greater than or equal to the difference between your competitor’s price point and the customer’s maximum willingness to pay for their product.

New product frameworks are used to help a company decide whether or not to launch a product or service.

New product frameworks share many similarities with market entry frameworks. In order to recommend launching a new product, the following statements would need to be true:

• The product targets an attractive market segment
• The product meets customer needs and is superior to competitor products
• The company has the capabilities to successfully launch the product
• Launching the product will be highly profitable

Expanding on these areas, your new product framework could look like the following:

A comprehensive guide to market sizing questions and market sizing frameworks can be found in our comprehensive market sizing article. You can also watch the video below:

As a summary, market sizing or estimation questions ask you to determine the size of a particular market or to estimate a particular figure.

There are two different market sizing frameworks or approaches:

• Top-down approach : start with a large number and then refine and break down the number until you get your answer
• Bottom-up approach : start with a small number and then build up and increase the number until you get your answer

To create your market sizing framework, simply write out in bullet points, the exact steps you would take to calculate the requested market size or estimation figure.

Consulting Frameworks Every Consultant Knows

There are six consulting frameworks that nearly every consultant knows.

I would not recommend using these exact frameworks during a case interview because the interviewer may think you are just regurgitating memorized information instead of thinking critically about the case.

Instead use the four framework strategies that we covered earlier in this article to create tailored and unique frameworks for each case.

Nevertheless, it is helpful to review these common consulting frameworks in order to understand the fundamental concepts and business principles behind them.

Porter’s Five Forces framework was developed by Harvard Business School professor Michael Porter. This framework is used to analyze the attractiveness of a particular industry.

There are five forces that determine whether an industry is attractive or unattractive.

Competitive rivalry:  How competitive is the industry?

The more competitive an industry is in terms of number and strength of competitors, the less attractive the industry is. The less competitive an industry is, the more attractive the industry is.

Supplier power:  How much power do suppliers have?

Suppliers are companies that provide the raw materials for your company to produce goods or services. The fewer suppliers there are, the more bargaining power suppliers have in setting prices. The more suppliers there are, the weaker bargaining power suppliers have in setting prices.

Therefore, high supplier power makes the industry less attractive while low supplier power makes the industry more attractive.   

Buyer power:  How much power do buyers have?

Buyers are customers or companies that purchase your company’s product. The more buyers there are, the weaker bargaining power buyers have in setting prices. The fewer buyers there are, the more bargaining power buyers have in setting prices.

Therefore, high buyer power makes the industry less attractive while low buyer power makes the industry more attractive.   

Threat of substitution:  How difficult is it for customers to find and use substitutes over your product?

The availability of many substitutes makes the industry less attractive while a lack of substitutes makes the industry more attractive

Threat of new entry:  How difficult is it for new players to enter the market?

If barriers to entry are high, then it is difficult for new players to enter the market and it is easier for existing players to maintain their market share.

If barriers to entry are low, then it is easy for new players to enter the market and more difficult for existing players to maintain their market share.

A low threat of new entrants makes the market more attractive while a high threat of new entrants makes the market less attractive.

A SWOT framework is used to assess a company’s strategic position. SWOT stands for strengths, weaknesses, opportunities, and threats.

Strengths : What does the company do well? What qualities separate them from competitors?

Weaknesses : What does the company do poorly? What are the things that competitors do better?

Opportunities : Where are the company’s opportunities for growth or improvement?

Threats : Who are the most threatening competitors? What are the major risks to the company’s business?

The 4 P’s framework is used to develop a marketing strategy for a product. The 4 P’s in this framework are: product, place, promotion, and price.

Product : If there are multiple products or different versions of a product, you will need to decide which product to market. To do this, you will need to fully understand the benefits and points of differentiation of each product.

Select the product that best fits customer needs for the customer segment you are focusing on.

Place : You will need to decide where the product will be sold to customers. Different customer segments have different purchasing habits and behaviors. Therefore, some distribution channels will be more effective than others.

Should the product be sold directly to the customer online? Should the product be sold in the company’s stores? Should the product be sold through retail partners instead?

Promotion : You will need to decide how to spread information about the product to customers. Different customer segments have different media consumption habits and preferences. Therefore, some promotional strategies will be more effective than others.

Promotional techniques and strategies include advertising, social media marketing, email marketing, search engine marketing, video marketing, and public relations. Select the strategies and techniques that will be the most effective.

Price : You will need to decide how to price the product. Pricing is important because it determines the profits and the quantity of units sold. Pricing can also communicate information on the quality or value of the product.

If you price the product too high, you may be pricing the product above your customer segment’s willingness to pay. This would lead to lost sales.

If you price the product too low, you may be losing potential profit from customers who were willing to pay a higher price. You may also be losing profits from customers who perceive the product as low-quality due to a low price point.

In deciding on a price, you can consider the costs to produce the product, the prices of other similar products, and the value that you are providing to customers.

The 3 C’s framework is used to develop a business strategy for a company. 3 C’s stands for customers, competition, and company.

The business situation framework was developed by a former McKinsey consultant, Victor Cheng, who added a fourth component to this framework, product.

Both of these frameworks are used to develop a business strategy for a company in a variety of situations, such as market entry, new product launch, and acquisition.

There is another similar framework called the 4C framework that expands upon the 3 C's. The 4C framework stands for customer, competition, capabilities, and cost.

The BCG 2x2 Matrix Framework was developed by BCG founder Bruce Hendersen. It is used to examine all of the different businesses of a company to determine which businesses the company should invest in and focus on.

The BCG 2x2 Matrix has two different dimensions:

• Market growth : How quickly is the market growing?
• Relative market share : How much market share does the company have compared to competitors?

Each business of the company can be assessed on these two dimensions on a scale of low to high. This is what creates the 2x2 Matrix because it creates four different quadrants.

Each quadrant has a recommended strategy.

• Stars : These are businesses that have high market growth rate and high relative market share. These businesses should be heavily invested in so they can continue to grow.
• Cows :   These are businesses that have low market growth rate, but high relative market share. These businesses should be maintained since they are stable, profitable businesses.
• Dogs :   These are businesses that have low market growth rate and low relative market share. These businesses should not be invested in and should possibly even be divested to free up cash for other businesses.
• Unknown : These are businesses that have high market growth rate and low relative market share. The strategy for these businesses is not clear. With enough investment, these businesses could become stars. However, these businesses could also become dogs if the market growth slows or declines.

The McKinsey 7S Framework was developed by two former McKinsey consultants, Tom Peters and Robert Waterman. The 7S Framework identifies seven elements that a company needs to align on in order to be successful.

These elements are:

• Strategy : The company’s plan to grow and outcompete competitors
• Structure : The organization of the company
• Systems : The company’s daily activities and processes
• Shared values : The core beliefs, values, or mission of the company
• Style : The style of leadership or management used
• Staff : The employees that are hired
• Skills : The capabilities of the company’s employees

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Home » Management Case Studies » Case Study: Nestle’s Growth Strategy

Case Study: Nestle’s Growth Strategy

Nestle is one of the oldest of all multinational businesses. The company was founded in Switzerland in 1866 by Heinrich Nestle, who established Nestle to distribute “milk food,” a type of infant food he had invented that was made from powdered milk, baked food, and sugar. From its very early days, the company looked to other countries for growth opportunities, establishing its first foreign offices in London in 1868. In 1905, the company merged with the Anglo-Swiss Condensed Milk, thereby broadening the company’s product line to include both condensed milk and infant formulas. Forced by Switzer ­land’s small size to look outside’ its borders for growth opportunities, Nestle established condensed milk and infant food processing plants in the United States and Britain in the late 19th century and in Australia, South America, Africa, and Asia in the first three decades of the 20th century. In 1929, Nestle moved into the chocolate business when it acquired a Swiss chocolate maker. This was fol ­lowed in 1938 by the development of Nestle’s most rev ­olutionary product, Nescafe, the world’s first soluble coffee drink. After World War 11, Nestle continued to expand into other areas of the food business, primarily through a series of acquisitions that included Maggi (1947), Cross & Blackwell (1960), Findus (1962), Libby’s (1970), Stouffer’s (1973), Carnation (1985), Rowntree (1988), and Perrier (1992). By the late 1990s, Nestle had 500 factories in 76 countries and sold its products in a staggering 193 nations-almost every country in the world. In 1998, the company generated sales of close to SWF 72 billion ($51 billion), only 1 percent of which occurred in its home country. Similarly, only 3 percent of its- 210,000 employees were located in Switzerland. Nestle was the world’s biggest maker of infant formula, powdered milk, chocolates, instant coffee, soups, and mineral waters. It was number two in ice cream, breakfast cereals, and pet food. Roughly 38 percent of its food sales were made in Europe, 32 percent in the Americas, and 20 percent in Africa and Asia.

Management Structure

Nestle is a decentralized organization . Responsibility for operating decisions is pushed down to local units, which typically enjoy a high degree of autonomy with regard to decisions involving pricing, distribution, marketing, human resources, and so on. At the same time, the company is organized into seven worldwide strategic business units (SBUs) that have responsibility for high-level strategic decisions and business development. For example, a strategic business unit focuses on coffee and beverages. Another one focuses on confectionery and ice cream. These SBUs engage in overall strategy development, including acquisitions and market entry strategy. In recent years, two-thirds of Nestle’s growth has come from acquisitions, so this is a critical function. Running in parallel to this structure is a regional organization that divides the world into five major geographical zones, such as Europe, North America and Asia. The regional organizations assist in the overall strategy development process and are responsible for developing regional strategies (an example would be Nestle’s strategy in the Middle East, which was discussed earlier). Neither the SBU nor regional managers, however, get involved in local operating or strategic decisions on anything other than an exceptional basis.

Although Nestle makes intensive use of local managers to knit its diverse worldwide operations together, the company relies on its “expatriate army.” This consists of about 700 managers who spend the bulk of their careers on foreign assignments , moving from one country to the next. Selected primarily on the basis of their ability, drive and willingness to live a quasi-nomadic lifestyle, these individuals often work in half-a-dozen nations during their careers. Nestle also uses management development programs as a strategic tool for creating an esprit de corps among managers. At Rive-Reine, the company’s international training center in Switzerland, the company brings together, managers from around the world, at different stages in their careers, for specially targetted development programs of two to three weeks’ duration. The objective of these programs is to give the managers a better understanding of Nestle’s culture and strategy, and to give them access to the company’s top management.

The research and development operation has a special place within Nestle, which is not surprising for a company that was established to commercialize innovative food stuffs. The R&D function comprises 18 different groups that operate in 11 countries throughout the world. Nestle spends approximately 1 percent of its annual sales revenue on R&D and has 3,100 employees dedicated to the function. Around 70 percent of the R&D budget is spent on development initiatives. These initiatives focus on developing products and processes that fulfill market needs, as identified by the SBUs, in concert with regional and local managers. For example, Nestle instant noodle products were originally developed by the R&D group in response to the perceived needs of local operating companies through the Asian region. The company also has longer-term development projects that focus on developing new technological platforms, such as non-animal protein sources or agricultural biotechnology products.

A Growth Strategy for the 21 st Century

Despite its undisputed success, Nestle realized by the early 1990s, that it faced significant challenges in maintaining its growth rate. The large Western European and North American markets were mature. In several countries, population growth had stagnated and in some, there had been a small decline in food consumption. The retail environment in many Western nations had become increasingly challenging and the balance of power was shifting away from the large-scale manufacturers of branded foods and beverages, and toward nationwide supermarket and discount chains. Increasingly, retailers found themselves in the unfamiliar position of playing off against each other – manufacturers of branded foods, thus bargaining down prices. Particularly in Europe, this trend was enhanced by the successful introduction of private-label brands by several of Europe’s leading supermarket chains. The results included increased price competition in several key segments of the food and beverage market, such as cereals, coffee and soft drinks.

At Nestle, one response has been to look toward emerging markets in Eastern Europe, Asia and Latin America for growth possibilities. The logic is simple and obvious – a combination of economic and population growth, when coupled with the widespread adoption of market-oriented economic policies by the governments of many developing nations, makes for attractive business opportunities. Many of these countries are still relatively poor, but their economies are growing rapidly. For example, if current economic growth forecasts occur, by 2010, there will be 700 million people in China and India that have income levels approaching those of Spain in the mid-1990s. As income levels rise, it is increasingly likely that consumers in these nations will start to substitute branded food products for basic foodstuffs, creating a large market opportunity for companies such as Nestle.

In general, Nestle’s growth strategy had been to enter emerging markets early – before competitors – and build a substantial position by selling basic food items that appeal to the local population base, such as infant formula, condensed milk, noodles and tofu. By narrowing its initial market focus to just a handful of strategic brands, Nestle claims it can simplify life, reduce risk, and concentrate its marketing resources and managerial effort on a limited number of key niches. The goal is to build a commanding market position in each of these niches. By pursuing such a strategy, Nestle has taken as much as 85 percent of the market for instant coffee in Mexico, 66 percent of the market for powdered milk in the Philippines, and 70 percent of the markets for soups in Chile. As income levels rise, the company progressively moves out from these niches, introducing more upscale items, such as mineral water, chocolate, cookies, and prepared foodstuffs.

Although the company is known worldwide for several key brands, such as Nescafe, it uses local brands in many markets. The company owns 8,500 brands, but only 750 of them are registered in more than one country, and only 80 are registered in more than 10 countries. While the company will use the same “global brands” in multiple developed markets, in the developing world it focuses on trying to optimize ingredients and processing technology to local conditions and then using a brand name that resonates locally. Customization rather than globalization is the key to the Nestle’s growth strategy in emerging markets.

Executing the Strategy

Successful execution of the strategy for developing markets requires a degree of flexibility, an ability to adapt in often unforeseen ways to local conditions, and a long-term perspective that puts building a sustainable business before short-term profitability. In Nigeria, for example, a crumbling road system, aging trucks, and the danger of violence forced the company to re-think its traditional distribution methods. Instead of operating a central warehouse, as is its preference in most nations, the country. For safety reasons, trucks carrying Nestle goods are allowed to travel only during the day and frequently under-armed guard. Marketing also poses challenges in Nigeria. With little opportunity for typical Western-style advertising on television of billboards, the company hired local singers to go to towns and villages offering a mix of entertainment and product demonstrations.

China provides another interesting example of local adaptation and long-term focus. After 13 years of talks, Nestle was formally invited into China in 1987, by the Government of Heilongjiang province. Nestle opened a plant to produce powdered milk and infant formula there in 1990, but quickly realized that the local rail and road infrastructure was inadequate and inhibited the collection of milk and delivery of finished products. Rather than make do with the local infrastructure, Nestle embarked on an ambitious plan to establish its own distribution network, known as milk roads, between 27 villages in the region and factory collection points, called chilling centres. Farmers brought their milk – often on bicycles or carts – to the centres where it was weighed and analysed. Unlike the government, Nestle paid the farmers promptly. Suddenly the farmers had an incentive to produce milk and many bought a second cow, increasing the cow population in the district by 3,000 to 9,000 in 18 months. Area managers then organized a delivery system that used dedicated vans to deliver the milk to Nestle’s factory.

Although at first glance this might seem to be a very costly solution, Nestle calculated that the long-term benefits would be substantial. Nestle’s strategy is similar to that undertaken by many European and American companies during the first waves of industrialization in those countries. Companies often had to invest in infrastructure that we now take for granted to get production off the ground. Once the infrastructure was in place, in China, Nestle’s production took off. In 1990, 316 tons of powdered milk and infant formula were produced. By 1994, output exceeded 10,000 tons and the company decided to triple capacity. Based on this experience, Nestle decided to build another two powdered milk factories in China and was aiming to generate sales of $700 million by 2000.

Nestle is pursuing a similar long-term bet in the Middle East, an area in which most multinational food companies have little presence. Collectively, the Middle East accounts for only about 2 percent of Nestle’s worldwide sales and the individual markets are very small. However, Nestle’s long-term strategy is based on the assumption that regional conflicts will subside and intra-regional trade will expand as trade barriers between countries in the region come down. Once that happens, Nestle’s factories in the Middle East should be able to sell throughout the region, thereby realizing scale economies. In anticipation of this development, Nestle has established a network of factories in five countries, in the hope that each will, someday, supply the entire region with different products. The company, currently makes ice-cream in Dubai, soups and cereals in Saudi Arabia, yogurt and bouillon in Egypt, chocolate in Turkey, and ketchup and instant noodles in Syria. For the present, Nestle can survive in these markets by using local materials and focusing on local demand. The Syrian factory, for example, relies on products that use tomatoes, a major local agricultural product. Syria also produces wheat, which is the main ingredient in instant noodles. Even if trade barriers don’t come down soon, Nestle has indicated it will remain committed to the region. By using local inputs and focussing on local consumer needs, it has earned a good rate of return in the region, even though the individual markets are small.

Despite its successes in places such as China and parts of the Middle East, not all of Nestle’s moves have worked out so well. Like several other Western companies, Nestle has had its problems in Japan, where a failure to adapt its coffee brand to local conditions meant the loss of a significant market opportunity to another Western company, Coca Cola. For years, Nestle’s instant coffee brand was the dominant coffee product in Japan. In the 1960s, cold canned coffee (which can be purchased from soda vending machines) started to gain a following in Japan. Nestle dismissed the product as just a coffee-flavoured drink rather than the real thing and declined to enter the market. Nestle’s local partner at the time, Kirin Beer, was so incensed at Nestle’s refusal to enter the canned coffee market that it broke off its relationship with the company. In contrast, Coca Cola entered the market with Georgia, a product developed specifically for this segment of the Japanese market. By leveraging its existing distribution channel, Coca Cola captured a 40 percent share of the $4 billion a year, market for canned coffee in Japan. Nestle, which failed to enter the market until the 1980s, has only a 4 percent share.

While Nestle has built businesses from the ground up, in many emerging markets, such as Nigeria and China, in others it will purchase local companies if suitable candidates can be found. The company pursued such a strategy in Poland, which it entered in 1994, by purchasing Goplana, the country’s second largest chocolate manufacturer. With the collapse of communism and the opening of the Polish market, income levels in Poland have started to rise and so has chocolate consumption. Once a scarce item, the market grew by 8 percent a year, throughout the 1990s. To take advantage of this opportunity, Nestle has pursued a strategy of evolution, rather than revolution. It has kept the top management of the company staffed with locals – as it does in most of its operations around the world – and carefully adjusted Goplana’s product line to better match local opportunities. At the same time, it has pumped money into Goplana’s marketing, which has enabled the unit to gain share from several other chocolate makers in the country. Still, competition in the market is intense. Eight companies, including several foreign-owned enterprises, such as the market leader, Wedel, which is owned by PepsiCo , are vying for market share, and this has depressed prices and profit margins, despite the healthy volume growth.

Discussions:

• Does it make sense for Nestle to focus its growth efforts on emerging markets? Why?
• What is the company’s strategy with regard to business development in emerging markets? Does this strategy make sense? From an organizational perspective, what is required for this strategy to work effectively?
• Through your own research on NESTLE, identify appropriate performance indicators. Once you have gathered relevant data on these, undertake a performance analysis of the company over the last five years. What does the analysis tell you about the success or otherwise of the strategy adopted by the company?
• How would you describe Nestle’s strategic posture at the corporate level; is it pursuing a global strategy, a multidomestic strategy an international strategy or a transnational strategy?
• Does this overall strategic posture make sense given the markets and countries that Nestle participates in? Why?
• Is Nestle’s management structure and philosophy aligned with its overall strategic posture?

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• Case Study: Lenovo’s “PC Plus” Strategy
• Case Study: Ryanair Business Strategy Analysis
• Case Study on Marketing Strategy: Starbucks Entry to China
• Business Strategy Case Study: Relaunch of Fiat 500
• Case Study of Dell: Primary Target Markets and Positioning Strategy
• Case Study: An Assessment of Wal-Mart’s Global Expansion Strategy
• Case Study: Strategy of Ryanair

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47 case interview examples (from McKinsey, BCG, Bain, etc.)

One of the best ways to prepare for   case interviews  at firms like McKinsey, BCG, or Bain, is by studying case interview examples. 

There are a lot of free sample cases out there, but it's really hard to know where to start. So in this article, we have listed all the best free case examples available, in one place.

The below list of resources includes interactive case interview samples provided by consulting firms, video case interview demonstrations, case books, and materials developed by the team here at IGotAnOffer. Let's continue to the list.

• McKinsey examples
• BCG examples
• Bain examples
• Deloitte examples
• Other firms' examples
• Case books from consulting clubs
• Case interview preparation

Click here to practise 1-on-1 with MBB ex-interviewers

1. mckinsey case interview examples.

• Beautify case interview (McKinsey website)
• Diconsa case interview (McKinsey website)
• Electro-light case interview (McKinsey website)
• GlobaPharm case interview (McKinsey website)
• National Education case interview (McKinsey website)
• Talbot Trucks case interview (McKinsey website)
• Shops Corporation case interview (McKinsey website)
• Conservation Forever case interview (McKinsey website)
• McKinsey case interview guide (by IGotAnOffer)
• Profitability case with ex-McKinsey manager (by IGotAnOffer)
• McKinsey live case interview extract (by IGotAnOffer) - See below

2. BCG case interview examples

• Foods Inc and GenCo case samples  (BCG website)
• Chateau Boomerang written case interview  (BCG website)
• BCG case interview guide (by IGotAnOffer)
• Written cases guide (by IGotAnOffer)
• BCG live case interview with notes (by IGotAnOffer)
• BCG mock case interview with ex-BCG associate director - Public sector case (by IGotAnOffer)
• BCG mock case interview: Revenue problem case (by IGotAnOffer) - See below

3. Bain case interview examples

• CoffeeCo practice case (Bain website)
• FashionCo practice case (Bain website)
• Associate Consultant mock interview video (Bain website)
• Consultant mock interview video (Bain website)
• Written case interview tips (Bain website)
• Bain case interview guide   (by IGotAnOffer)
• Digital transformation case with ex-Bain consultant
• Bain case mock interview with ex-Bain manager (below)

4. Deloitte case interview examples

• Engagement Strategy practice case (Deloitte website)
• Recreation Unlimited practice case (Deloitte website)
• Strategic Vision practice case (Deloitte website)
• Retail Strategy practice case  (Deloitte website)
• Finance Strategy practice case  (Deloitte website)
• Talent Management practice case (Deloitte website)
• Enterprise Resource Management practice case (Deloitte website)
• Footloose written case  (by Deloitte)
• Deloitte case interview guide (by IGotAnOffer)

5. Accenture case interview examples

• Case interview workbook (by Accenture)
• Accenture case interview guide (by IGotAnOffer)

6. OC&C case interview examples

• Leisure Club case example (by OC&C)
• Imported Spirits case example (by OC&C)

7. Oliver Wyman case interview examples

• Wumbleworld case sample (Oliver Wyman website)
• Aqualine case sample (Oliver Wyman website)
• Oliver Wyman case interview guide (by IGotAnOffer)

8. A.T. Kearney case interview examples

• Promotion planning case question (A.T. Kearney website)
• Consulting case book and examples (by A.T. Kearney)
• AT Kearney case interview guide (by IGotAnOffer)

9. Strategy& / PWC case interview examples

• Presentation overview with sample questions (by Strategy& / PWC)
• Strategy& / PWC case interview guide (by IGotAnOffer)

10. L.E.K. Consulting case interview examples

• Case interview example video walkthrough   (L.E.K. website)
• Market sizing case example video walkthrough  (L.E.K. website)

11. Roland Berger case interview examples

• Transit oriented development case webinar part 1  (Roland Berger website)
• Transit oriented development case webinar part 2   (Roland Berger website)
• 3D printed hip implants case webinar part 1   (Roland Berger website)
• 3D printed hip implants case webinar part 2   (Roland Berger website)
• Roland Berger case interview guide   (by IGotAnOffer)

12. Capital One case interview examples

• Case interview example video walkthrough  (Capital One website)
• Capital One case interview guide (by IGotAnOffer)

12. EY Parthenon case interview examples

• Candidate-led case example with feedback (by IGotAnOffer)

14. Consulting clubs case interview examples

• Berkeley case book (2006)
• Columbia case book (2006)
• Darden case book (2012)
• Darden case book (2018)
• Duke case book (2010)
• Duke case book (2014)
• ESADE case book (2011)
• Goizueta case book (2006)
• Illinois case book (2015)
• LBS case book (2006)
• MIT case book (2001)
• Notre Dame case book (2017)
• Ross case book (2010)
• Wharton case book (2010)

Practice with experts

Using case interview examples is a key part of your interview preparation, but it isn’t enough.

At some point you’ll want to practise with friends or family who can give some useful feedback. However, if you really want the best possible preparation for your case interview, you'll also want to work with ex-consultants who have experience running interviews at McKinsey, Bain, BCG, etc.

If you know anyone who fits that description, fantastic! But for most of us, it's tough to find the right connections to make this happen. And it might also be difficult to practice multiple hours with that person unless you know them really well.

Here's the good news. We've already made the connections for you. We’ve created a coaching service where you can do mock case interviews 1-on-1 with ex-interviewers from MBB firms . Start scheduling sessions today!

Related articles:

• Growth marketing

Impressive growth marketing case studies from Dashly clients [tactics, tools, results]

Ever wondered what it’s like to peek behind the growth hackers’ curtain? Well, buckle up! I’m the skipper at Dashly’s Growth Team and I’ve got some secrets to spill. Arm yourself with our most impressive growth marketing case studies straight from our playbook!

Cutting to the chase — these are tales of cunning tactics, cunning tools, and pretty darn good results. Sketches of how we’ve driven businesses from various sectors, SaaS companies included, to pump up their marketing game and reach those exhilarating milestones.

Through this breezy read, we’re letting you in on the nitty-gritty of how we collaborate with our customers. It’s about creating sterling strategies and celebrating stellar outcomes.

And guess what? We’re going to reveal our backstage magic — the strategies and stories of success. So get ready to dig deep into how we’ve woven growth into our clients’ stories. These bite-sized nuggets of wisdom could be the spark you need to level up your own game!

Yup, every business is its own beast, but when we face it together and learn from each other, that’s where you find the real growth. Let’s dive in!

Skyrocket marketing lead generation

+1,152 leads growth with a chatbot growth marketing case .

One of the customers’ case studies Dashly is working on is a school aimed at film production. When folks browse through their site investigating different courses, decision-making isn’t typically a rapid process.

And the fix for this?

The crew behind the digital academy figured out the preferences of the site visitors and assembled their contact details for the sales people. This opened the gateways for them to connect with the potential leads and offer guidance in selecting the most fitting course.

Qualifying leads emerge as a vital element in hacking growth as it lends you a meaningful understanding of your intended crowd.

So, they decided to integrate a Dashly chatbot on their online platform to:

👉 Kickstart chats with the guests; 👉 Put forward qualifying queries; 👉 Compile contact numbers.

This collected data is then transported to amoCRM, arming the sales folks with all the info they need to give potential students a ring and make a suitable course suggestion.

The payoff? They achieved 1,152 leads growth in a mere five months.

+12% target leads growth with pop-up quiz and chatbot

We’re weaving the saga of Seamus Bennett (CEO and co-founder of  KVR , a top-tier software development firm), who onboarded Dashly to turbocharge the lead qualification mechanics on his website, a strategic move to drive growth.

Sales heavyweights previously operated exclusively with those eager to swiftly fork out funds and dive headfirst into product deployment. But to amp up revenue and align with growth marketing strategies, the case required mastering techniques to engage with prospects requiring more nurturing time and not prepped for an instant buy. This marketing growth strategy is somewhat convoluted.

The mission of pushing for long-term sales may appear a tad alien to sales veterans whose monthly windfalls hinge on achieving preset sales targets. What’s the remedy?

1. Lead qualification pop-up quiz on product pages (since its visitors are more ready to buy.)

Thus, they can define leads that meet the ICP portrait and call them first. It’s one of the best growth marketing tips .

2. Chatbot to capture and qualify blog readers 

Each reader browsing the content within the blog articles was given the chance to interact with a chatbot following the initial 30 seconds of their session. The outcomes for the company:

👉 An increase of 12% in orders due to the integration of engaging pop-up quizzes and the chatbot into their strategy. 👉 A solid 60% of orders originating from the quizzes and the Dashly chatbot are specifically targeted.

Read the entire story

Thanks! Here’s your copy of  the growth strategy template

School for IT and Data specialists got +44% applications growth

This case study of Dashly client was grappling with an issue: An underwhelming number of applications on the course pages. A chunk of visitors bounce without sealing the deal, and inquiries of those who eventually do aren’t attended to speedily by the managing crew. Hence, the anticipated uptick in key growth marketing metrics for their business remained elusive.

Chatbot on the “Data Science from scratch” course page

The chatbot, snugly fit within the Dashly platform, doesn’t suddenly prompt you to enroll for a course. Instead, it gently evolves into a lead qualifier, presenting itself as an assistant to help carve your education journey and manage personal career hurdles.

The impact made by this implementation in their product strategy: 

• 7.5% of users disclosed their emails,
• 5.3% parted with their phone numbers.

Chatbot on the “Data Science: Advanced course” page

This particular page is tailored for seasoned pros looking to carve a niche in this industry. Here, the chatbot’s objective is to reinforce the fact that they’ve stumbled upon the perfect hotspot to satisfy their ambitions and elevate their abilities, perfectly aligning with the company’s growth goals.

Leveraging creative marketing, the chatbot dangled the bait of a complimentary career guide, a savvy marketing tactic intended to coax leads into revealing their contact information.

The results:

👉 22,7% shared emails, 👉 15,5% shared phone numbers.

Marketing case studies on how to boost conversion into signup

+70% conversion onto sign-up with a chatbot .

Teaming up with Anthony, co-founder of an  online platform for Instagram account growth , we tackled a case focused on this hiccup: incoming users ducked out before reaching the payment section. So what was the panacea for this marketing problem with room for growth?

They already had an enticing deal in place — an automated message paired with a free audit.

However, the original format of the deal wasn’t exactly cutting it. To amplify the shift from mere browsing to actual signup, we proposed tailoring this offer around the distinct pain points of the customers, and rolling it out as an engaging dialogue with a chatbot. 

Using a chatbot, they got a 70% growth in conversion to users signups. As for the overall funnel performance, it added 5% to the conversion to sign-up.

Thanks! Here’s your copy of 100 growth ideas

How growth hackers engage users to complete registration

In Dashly, we work with Freedom24 — a fintech company. They have a registration issue. After registration in a website form, users should confirm their residential address with a utility bill or any other document. Some of them find this step rather difficult and abandon registration.

Freedom24 marketing team sends them three onboarding emails :

👉 The first one describes the benefits a client gets after opening an account. 👉 The second message highlights the opportunity to get support.  👉 The third email intrigues you with 30 days of the free-of-charge Promo account.

Freedom24 marketers use the same CTA at the beginning and end of each email message to highlight the main action.

At Dashly, we’re collaborating with Freedom24 — a fintech company . They are grappling with a registration snag. Upon registration via the website form, users must verify their residential address with a utility bill or some equivalent document. Some folks find this step rather cumbersome, leading them to ditch the registration process partway.

So, what’s the resolution?

The nifty Freedom24 marketing team sets into motion three onboarding emails for users: 

👉 The initial one elaborates on the perks awaiting a client following account activation.  👉 The subsequent email underscores the provision of assistance.  👉 The final email hooks you with a tantalizing offer of enjoying a free-for-any-charge Promo account for 30 days.

To strike home their focal point, Freedom24 marketers smartly lace the same call-to-action (CTA) at the commencement and termination of each content email to capture attention. This has proved beneficial to both users and the business.

Open Rate: 23.15% CTR: 2,59%

Open Rate: 43.55% CTR: 10,51%

Open Rate: 46.61% CTR: 1,60%

Since 50% of the website traffic goes to the Freedom24 app, its users receive relevant push notifications as well:

Open Rate: 30.47% CTR: 3.65%

Open Rate: 13.55% CTR: 0.57%

Open Rate: 18.18% CTR: 0.65%

Consequently, folks who’ve signed up at Freedom24, courtesy of this strategy incorporated into the email program: 

👉 Recall the importance of initiating an account to commence their investment journey through the platform,  👉 Understand the correct pathway to seek aid for account setup,  👉 Spark an inner urge to expedite the process.

Need more inspo for your growth strategy? We’re here to help 👇

Marketing case studies about conversion to payment 

+30% free-to-paid conversion rate growth with a chatbot on pricing page.

Switching gears to our following collaborator — LeadGen App . They come armed with a form-builder service that empowers SME enterprises, digital agencies, and marketers to craft forms primed for conversion, resulting in an uptick in feedback during lead generation campaigns. Amid a sea of  growth marketing tools , data driven CEO Christopher chose to enlist Dashly platform to tackle the ensuing challenge — boost the conversion rate from free to paid users. One of the solutions we made was launching a chatbot on their pricing page:

Opting for any of the given options, like “How does LeadGen App stand out from other growth marketing services ,” you are greeted with an in-depth response. This comes as linked case content that guides visitors straight to the free account registration step:

At the end of the message customers see a link leading them to the registration and LeadGen App Pro Tariff: 

When visitors look for a certain feature, the chatbot asks them to share an email. Thus, Christopher can contact them later about the chosen feature.

Chatbots truly are a force to reckon with in various B2B growth hacking strategies . Armed with chatbots, Christopher now has a steady inflow of registrations and quality leads to follow up, effectively aligning with his strategy.

The impact : 

A surge in the number of users who interacted with the chatbot on the pricing page significantly boosted sales. This steered the company towards a substantial 31% uptick in sales transactions following the first month of  chatbot implementation in their content.

Read also: 25 Growth Marketing Books to Skyrocket Success

+$2k revenue with video pop-ups growth marketing case 

Before collaboration with Dashly, this online platform for Instagram account growth saw merely 23% of total users invest in their features.

In tandem with the client, we brought to life an onboarding system using Dashly’s toolkit. This system was designed to steer B2B users through the sales funnel, inspiring them to spring for feature purchases. Subsequently, we integrated pop-ups into the business platform, utilizing them to underline the worth of premium features.

In our most triumphant growth marketing experiment, we slipped in a video guide from the company.

The result in a month after the implementation:

• revenue amounted to $2k (the minimum price for a feature is $3, and we got 653 transactions);
• conversion to purchasing a full audit was 8% of impressions.

Read also: Growth marketing vs performance marketing and RevOps vs Sales Ops .

+30% features sales with triggered email for bounced free users

Apart from pop-ups, for a former client, we rolled out email drives designed to reel in users who dropped off the platform without buying features. Each of these campaigns contained a pair of emails: 👉 Email one was promptly delivered right after a user jumped ship; 👉 Email two, crafted to avoid causing annoyance, was scheduled to be sent after a two-day gap. 

If a user snagged a feature post the first email, they were spared the receipt of the second one.

Here’s a glimpse at the top-performing email, boasting a 53% Open Rate. This marketing maneuver, as part of the case, enabled the growth marketing squad to rake in a revenue north of $1.5k.

Overall email performance a month after the implementation:

• revenue — $1.5k (ARPU— $2.5, 574 transactions);
• the Conversion Rate of each email was from 7% to 15%;
• emails generated 30% of all feature sales.

User activation into a product

+33% conversion to the first application among new users (cpa network) .

This firm operates as a  CPA network affiliating bank programs, microfinance entities, insurance, and law enterprises. The company’s income is tightly linked to the activity level at which webmasters spotlight their offers.

Picture this: a user signs up on the site but is left scratching their head about your product’s workings. Typically, they might try to crack the code independently but eventually lose steam and slip into a “dormant” client mode. You can dodge this scenario, though, by immediately encouraging your clients to delve deeper and read about your product’s details.

This activation into the product is a crucial leap on the growth hacking canvas .

The solution?

Chatbot for user onboarding 👉

• Greets the webmaster on the dashboard after the signup. Qualifies users.
• Sends case studies, tool guides, and creative ideas for ads.
• Informs about bonuses.
• 1580 users interacted with the onboarding chatbot;
• The conversion rate of users to the first application has increased by 33%.

Reactivate inactive users

Every enterprise encounters customers who refrain from using its product, bypass the website, and treat communication efforts on different channels with indifference. It’s an age-old truth.

To tackle this hurdle, Freedom24 (fintech project) marketers resort to putting varied hypotheses to the test. For instance, their recent brainwave to “rekindle” interaction with such clients revolved around a combo of  app push notifications plus bonus-centric emails .

Indeed, this growth marketing tactic continues to clock in rigidly for the business, maintaining interaction with customers:

20 euro offer interested 2.95% of users who read this message in the app and 18.58% of clients who read it in email.

Marketing campaigns on how to greet and assist potential customers 

Initiate interaction with a potential client by extending a warm welcome via live chat . Slice up the audience into segments and then craft bespoke triggered messages tailored to each group for this company.

A subtle “How can we help? We’re here for you 😊” might suffice for first-timers. This approach ensures customers know precisely where to turn if they encounter a snag.

For the repeat customers, such as our boomerang buddy Mr. Yakamoto, the style can be more relaxed and chummy. Referencing a customer’s past dealings is an ace up the sleeve in terms of an engagement strategy. It allows you to resume dialogue right where you left off last.

Divvy up the audience and shoot proactive messages across varying stages of the customer journey. It ranks as one of the premier customer engagement strategies in growth marketing! Dashly client OpenCRM got aboard this tactic and witnessed a dazzling 400% surge in the total number of conversations 👇

Pro tip: you can also set up a virtual assistant. In our reality, a chatbot comes in handy for this task. 

Here’s how Dashly’s chatbot became a game-changer in guiding those visiting digital schools towards the right course choice. It’s all about the strategic “Data Science from Scratch” course page. Here, growth marketing tactics kick in and marketers start casual chats with visitors. The goal? To clear up any confusion and highlight the real value of the school’s courses.

No hard sell here — the chatbot doesn’t just blurt out “Sign up for this course” — no sirree. Instead, it gently guides and supports potential students, turning them into hot leads.

The chatbot jumps into action 29 seconds after a customer lands on the “Data Science from Scratch” course page. Its job? To aid SkillFactory customers navigate the maze of education and career decisions. So, there’s no aimless wandering around the website. Customers get the advice they need, right on the get-go, on the same page.

And the results speak for themselves:

⭐ 7.5% of visitors who got the chat message left their emails, ⭐ 5.3% of these visitors even shared their phone numbers.

What is a growth marketing case study?

A growth marketing case study is a detailed narrative that focuses on a company’s strategic use of growth marketing tactics. It chronicles how the company solved a problem, overcame a challenge or seized an opportunity, to drive significant growth or increase conversions.

How are growth marketing case studies useful for my business?

Growth marketing case studies can provide you with valuable insights into effective strategies and tactics used by other businesses. This helps you learn from their successes (or failures), trigger fresh ideas for your own strategies, and improve your decision-making process.

What information can I typically find in a growth marketing case study?

A growth marketing case study usually provides details about the subject company, its marketing objectives, the strategies it implemented, the challenges it faced, and the results it achieved. It may also provide analyses of strategy effectiveness as well as lessons learned.

Where can I find growth marketing case studies?

You can typically find growth marketing case studies on business education websites, marketing blogs, market research sites, and websites of marketing agencies. They can also be found in eBooks, whitepapers, and reports published by software providers or marketing consultancies.

How can I create a growth marketing case study for my business?

Creating a growth marketing case study involves defining your objectives and key measurements, documenting your strategies and their implementations, monitoring and recording results, and analyzing outcomes. It’s crucial to remember that an ideal case study not only highlights successes, but also provides a thoughtful evaluation of what could have been done better.

• Deep dive into growth marketing analytics with Dashly experts
• 22 SaaS growth hack Facebook tactics to boost your business
• Skyrocket your company revenue with a complete guide to  RevOps Revenue Operations
• RevOps tech stack : Guide to the best tools
• Revenue operations metrics : 10 metrics and KPIs to track your performance
• RevOps best practices : 13 tactics to implement this year
• Top 10 product led growth software your competitors use in 2023
• 10 product led growth companies that boost their development right now
• Growth marketing framework : Battle-tested insights from Dashly experts

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The framework for nailing revenue growth case questions

You’ve just been given a case question on growing an existing business. It’s up to you to organize your ideas into a structure that’s going to set you up for success.

The chances of being faced with this scenario in a case interview are high. In our 2023 analysis of case study interview questions at McKinsey, BCG and Bain , revenue growth was the second-most frequently cited topic, accounting for 15% of the case questions reported.

Here’s a framework we’ve developed to help you tackle case questions on revenue growth with clarity and confidence.

The two main ways to grow a business

The revenue growth framework is based on the principle that there are two main ways to grow a company’s revenue:

• Growing its core business
• Growing outside of its core business

To grow the core business , you could:

• grow across your current market segments
• and/or invest in the fastest-growing segments in the market

To grow across your current market segments you might look at how you could acquire or retain customers and increase how much they spend.

To invest in the fastest-growing market segments, you could look at the geographies, types of customers or product lines that are likely to experience the fastest growth.

To grow the business outside of its core offering , you could:

• sell new products to your current clients
• and/or leverage your capabilities to get into new business areas

To sell a new product to your current clients, you might look at introducing products that are similar or related to your existing products. These are options that will seem like a natural extension of your current offering. Your client might purchase these new products or services either when they buy your existing products or at a later stage.

To use your capabilities to get into new businesses, you would look at the assets that give your company a competitive advantage. These might include its brand, know-how, distribution network, or production facilities. You would then look at products and services that could make the best use of these assets.

To use this revenue growth framework in a case interview, draw two branches or ‘buckets’ to represent the main ways to grow a business. Then unpack the next level of detail in each subsequent branch, as shown in the example below.

The revenue growth case framework in practice

When you put this framework to use in a case interview, it’s vital that your segmentation and ideas are relevant to the client and their industry. You shouldn’t simply regurgitate the same structure for each case.

Imagine you’re a car maker with a strong presence in the SUV market. If you were to grow within that market, you might consider making better cars, improving your marketing, or offering competitive prices.

If you were to think about positioning your brand to maximize long-term growth you might invest in electric vehicles, a new low-cost line of cars, or possibly in the Asian market.

If you were to grow outside of your core business, you could sell new products – such as insurance and maintenance plans – or consider leasing to your current clients.

Alternatively, you could use your capabilities to get into new business areas, such as trucks, buses or motorbikes.

Remember that when you answer a case question on revenue growth, it’s important to identify the most relevant drivers for the situation you’ve been asked to consider. For instance, it wouldn’t make much sense for a startup that’s trying to establish itself in its core market to even consider growing outside of it. What would make sense will depend on a number of factors, such as time horizon, market maturity, and the position of the company in its market.

In any case, the revenue growth framework is an excellent starting point and a strong foundation from which to drive the rest of the case. You can learn more about how to use the framework – along with nine others that will help you answer the most common case interview questions – in the Case Interview Prep Course, included in our Consulting Interview Prep Toolkit .

Designed to teach you how to tackle each dimension of the case and fit interviews, the Toolkit contains all the online courses, sample interviews, case material, and practice tools you’ll need to ace any case interview. This includes access to our Case Library of over 100 cases, which span a range of sectors, functions and question types, including revenue growth.

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Subway’s Competitive Strategy & Growth Strategies

Subway’s competitive strategy and growth strategies direct business development toward industry leadership while maintaining the brand and what it stands for. This competitive strategy determines the competitive advantages and business competencies that are utilized to ensure profitability despite competition in the global fast-food market. The growth strategies guide Subway’s approaches and investments to grow its business and reach its goals. These strategies influence organizational development and reflect managerial decisions for addressing current foodservice market conditions and expectations. The PESTLE/PESTEL analysis of Subway provides details about these factors and trends that affect the foodservice industry and the implementation of the company’s intensive growth strategies and generic competitive strategy.

Subway’s growth strategies rely on a bigger market share, while the company’s competitive strategy depends on cost effective operations. The strategic goals and targets of Subway’s mission and vision are supported through growth and competitive advantages resulting from the company’s intensive growth strategies and generic competitive strategy.

Subway’s Competitive Strategy

Subway’s primary competitive strategy is cost leadership . According to Michael Porter’s model of generic strategies for competitive advantage, the objective of cost leadership is to minimize the costs of operating the quick-service restaurant (QSR) business. Through lower costs, this competitive strategy allows the company to improve its profit margins and to offer competitive prices for its various menu items. In this case, cost leadership is achieved through standardization and economies of scale, which are among the competitive advantages identified in the SWOT analysis of Subway . For example, standardized menu items and food preparation processes maximize efficiency and minimize waste, leading to reduced costs. Economies of scale enable cost-effective processes that support Subway’s competitive strategy of cost leadership.

Subway’s secondary competitive strategy is differentiation . Michael Porter’s model states that this generic strategy involves developing and using competitive advantages that differentiate the company, such as unique characteristics of food and beverage. Subway’s strategic objective for this competitive strategy is to ensure that its products and food service are unique enough to stand out from the competition. The Five Forces analysis of Subway shows aggressive rivalry involving major foodservice competitors, like McDonald’s , Burger King , and Wendy’s , as well as Starbucks . Subway’s competitive strategy of differentiation focuses on product characteristics, such as design, freshness, and quality, to attract consumers away from these competitors.

Subway’s Growth Strategies

Subway’s primary growth strategy is market penetration . Based on the Ansoff Matrix of intensive growth strategies, market penetration involves selling more of the same food and drinks in the company’s current markets. For example, with its competitive advantages, Subway aims to grow its business, revenues, and profits by selling more of its submarine sandwiches and drinks in the United States, Canada, and the European Union. The company implements this growth strategy through more aggressive franchising to establish more locations. In this regard, the generic competitive strategy of cost leadership enables competitive prices that attract consumers and support Subway’s growth strategy of market penetration. Similarly, the competitive strategy of differentiation leads to the uniqueness of submarine sandwich characteristics that attract more consumers, fueling the company’s growth.

Subway’s secondary growth strategy is product development . In the Ansoff Matrix, this intensive growth strategy involves offering new products to current markets and target customers. For example, Subway occasionally rolls out new menu items as part of this growth strategy. However, product development is only a secondary growth strategy because it involves considerable risks, such as the risk of producing food and beverage that do not generate satisfactory profits. Based on the competitive strategy of cost leadership, costs are minimized in implementing Subway’s growth strategy of product development. Also, the company’s competitive strategy of differentiation means that this growth strategy of product development focuses on new products that have unique attributes as competitive advantages.

Considerations in Implementing Subway’s Competitive Strategy & Growth Strategies

Subway’s operations management decisions determine the success of implementing the competitive strategy of cost leadership in the fast-food restaurant chain. For example, decisions on quality management, inventory management, and supply chain management influence the costs of operating the foodservice business and, thus, the cost-leadership status and competitive advantage of the organization. Also, the effectiveness of Subway’s marketing mix (4Ps) influences success in implementing the growth strategy of market penetration. Marketing strategies and tactics affect the company’s market share, as well as revenues and profits from offering new menu items to target consumers.

• About Subway .
• Gim, J., & Jang, S. (2023). Dividend and investment decisions in asymmetric information environments: Evidence from the restaurant industry. International Journal of Contemporary Hospitality Management, 35 (5), 1779-1801.
• Leppänen, P., George, G., & Alexy, O. (2023). When do novel business models lead to high performance? A configurational approach to value drivers, competitive strategy, and firm environment. Academy of Management Journal, 66 (1), 164-194.
• Subway Franchise Advantage .
• Subway Franchise Growth Opportunities .
• Susanto, A., & Fauziah, H. (2023). The influence of product placement and product attributes toward purchase intention of Subway sandwich. International Journal of Science and Business, 19 (1), 128-146.
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• Educators, Researchers, and Students: You are permitted to quote or paraphrase parts of this article (not the entire article) for educational or research purposes, as long as the article is properly cited and referenced together with its URL/link.

How to Answer Growth Strategy Case Questions in Management Consulting Interviews?

Learn how to ace growth strategy case questions in management consulting interviews with our comprehensive guide.

Posted May 11, 2023

Featuring Manali P.

Beyond the Case: Ace Your MBB Behavioral Interviews

Starting tuesday, september 24.

9:00 PM UTC · 30 minutes

Table of Contents

If you are pursuing a career in management consulting, then it is important to be familiar with case interviews. Case interviews are a common part of the recruitment process and are used to evaluate a candidate's problem-solving skills and ability to think critically. Growth strategy cases are one type of case interview that you may encounter. In this article, we will provide you with a comprehensive guide on how to answer growth strategy case questions in management consulting interviews.

Understanding the Basics of Growth Strategy Case Questions

Growth strategy case questions require you to analyze a company's current situation and identify opportunities for growth. The case may involve a company that is looking to expand into new markets, launch new products, or increase revenue. Your job as a consultant is to help the company develop a growth strategy that is based on sound analysis and effective decision making.

When analyzing a company's current situation, it is important to consider both internal and external factors. Internal factors may include the company's financial health, organizational structure, and current product offerings. External factors may include market trends, competition, and regulatory changes. By taking a holistic approach to analysis, you can identify the most promising opportunities for growth and develop a strategy that is tailored to the company's unique situation.

Tips for Analyzing Growth Strategy Case Questions

One of the key skills required for growth strategy case questions is the ability to analyze complex business problems. You need to be able to break down the case into its component parts, identify the key drivers and barriers to growth, and develop a structured approach to solving the problem. Some tips for analyzing growth strategy case questions include:

• Understanding the company's business model, including its products, customers, and competitors
• Identifying trends in the industry, such as changes in consumer behavior or emerging technologies
• Assessing the company's internal capabilities, including its financial position, operations, and talent

Another important aspect of analyzing growth strategy case questions is to consider the external factors that may impact the company's growth potential. This includes factors such as government regulations, economic conditions, and market saturation. It is important to understand how these external factors may affect the company's ability to grow and develop a strategy that takes them into account.

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Identifying Key Growth Drivers and Barriers in Case Questions

Once you have analyzed the case, you need to identify the key drivers and barriers to growth. These may include factors such as market size, the competitive landscape, regulatory environment, and customer preferences. It is important to prioritize these factors based on their impact on the company's growth potential.

Additionally, it is important to consider external factors that may impact the company's growth potential, such as economic trends, technological advancements, and political instability. These factors can have a significant impact on the company's ability to grow and succeed in the long term. By taking a holistic approach to analyzing the case, you can identify both internal and external factors that may impact the company's growth potential and develop a comprehensive strategy to address them.

Breaking Down Complex Business Problems to Develop Growth Strategies

Developing a growth strategy requires you to develop a deep understanding of the company's current position and future potential. You need to be able to break down complex business problems into manageable parts and develop focused solutions based on analysis. Some frameworks that you may find helpful for developing growth strategies include Porter's Five Forces, SWOT analysis, and the Boston Consulting Group (BCG) matrix.

One important aspect of developing growth strategies is to identify the key drivers of growth for the company. This involves analyzing the market trends, customer needs, and competitive landscape to determine where the company can differentiate itself and create value for its customers. By focusing on these key drivers, you can develop targeted growth strategies that align with the company's strengths and opportunities.

Another important consideration when developing growth strategies is to ensure that they are sustainable over the long term. This requires taking into account factors such as the company's financial resources, organizational capabilities, and risk tolerance. By developing growth strategies that are aligned with the company's overall vision and mission, and that take into account these key factors, you can create a roadmap for sustainable growth that will help the company achieve its goals over the long term.

Applying Frameworks to Solve Growth Strategy Case Questions

Frameworks such as Porter's Five Forces can help you evaluate the competitive dynamics of an industry, while the BCG matrix can help you analyze a company's product portfolio and make strategic decisions about investment. Applying these frameworks to the case will help you develop a structured approach to solving the problem and ensure that your recommendations are based on sound analysis.

Another useful framework to consider when solving growth strategy case questions is the Ansoff Matrix. This matrix helps you evaluate different growth strategies for a company, including market penetration, market development, product development, and diversification. By using the Ansoff Matrix, you can identify the best growth strategy for the company based on its current market position and growth objectives.

Using Data and Analytics to Support Your Growth Strategy Recommendations

An important part of developing a growth strategy is the use of data and analytics to support your recommendations. You need to be able to gather and analyze data on the market, customers, and competitors, and develop insights that support your strategy. Using analytics tools such as regression analysis and forecasting can help you make data-driven decisions and enhance the credibility of your recommendations.

Another important aspect of using data and analytics in your growth strategy is the ability to track and measure the success of your recommendations. By setting clear metrics and KPIs, you can monitor the impact of your strategy and make adjustments as needed. This allows you to continuously improve and optimize your growth strategy over time.

It's also important to consider the ethical implications of using data and analytics in your growth strategy. You need to ensure that you are collecting and using data in a responsible and transparent manner, and that you are respecting the privacy and rights of your customers. By prioritizing ethical considerations, you can build trust with your customers and stakeholders, and create a sustainable foundation for long-term growth.

Developing a Structured Approach to Answering Growth Strategy Case Questions

When answering growth strategy case questions, it is important to have a structured approach that helps you stay focused and organized. One effective approach is the MECE (Mutually Exclusive Collectively Exhaustive) framework, which involves breaking down a problem into mutually exclusive and collectively exhaustive parts. This approach can help you ensure that you are addressing all aspects of the case and not missing any critical insights.

Another important aspect of developing a structured approach to answering growth strategy case questions is to prioritize your analysis based on the most critical factors. This can be achieved by using a hypothesis-driven approach, where you start with a hypothesis about the most important factors driving growth and then test it through your analysis. By focusing on the most critical factors, you can avoid getting bogged down in irrelevant details and ensure that your analysis is focused and impactful.

Common Mistakes to Avoid When Answering Growth Strategy Case Questions

Some common mistakes that candidates make when answering growth strategy case questions include:

• Ignoring key data or insights that are relevant to the case
• Rushing through the analysis phase and not taking the time to fully understand the problem
• Jumping to conclusions without considering the bigger picture
• Not engaging the interviewer or asking questions to clarify the problem
• Focusing too much on one aspect of the case to the exclusion of others

Another common mistake that candidates make when answering growth strategy case questions is failing to consider the potential risks and challenges associated with their proposed solution. It's important to not only identify opportunities for growth, but also to assess the feasibility and potential drawbacks of each option. Additionally, candidates may overlook the importance of effective communication and presentation skills when presenting their findings and recommendations to the interviewer. Clear and concise communication is key to effectively conveying your ideas and demonstrating your problem-solving abilities.

Practicing with Sample Case Questions to Improve Your Skills in Answering Growth Strategy Case Questions

The best way to improve your skills in answering growth strategy case questions is to practice with sample case questions. There are many resources online that provide free sample case questions, as well as books and courses that offer more in-depth practice. Remember to focus on developing your analytical and problem-solving skills, and to take a structured approach to answering the questions.

The Importance of Communication and Presentation Skills in Answering Growth Strategy Case Questions

Finally, it is important to remember that communication and presentation skills are also critical when answering growth strategy case questions. You need to be able to clearly articulate your ideas and recommendations, and to present your analysis in a way that is easy for others to understand. Some tips for improving your communication and presentation skills include:

• Practicing your presentation skills, including voice projection, eye contact, and body language
• Preparing visual aids, such as slides or diagrams, to help illustrate your point
• Developing a clear and concise message that summarizes your analysis and recommendations
• Engaging the audience by asking questions or soliciting feedback
• Maintaining a positive and confident attitude throughout the presentation

How to Prepare for Growth Strategy Case Questions Before an Interview

If you are preparing for a management consulting interview that includes growth strategy case questions, there are several things you can do to get ready:

• Research the company and its industry to gain a better understanding of the context that the case questions may relate to
• Practice with sample case questions to develop your analytical and problem-solving skills
• Review frameworks such as Porter's Five Forces and the BCG matrix to become familiar with the tools that are commonly used in growth strategy analysis
• Seek feedback from others, such as colleagues or mentors, on your problem-solving and communication skills

Differences Between Answering Growth Strategy Cases in First-Round vs Final-Round Interviews

Finally, it is important to note that there may be differences in the complexity and depth of growth strategy case questions between first-round and final-round interviews. In first-round interviews, the focus is typically on evaluating your problem-solving skills and ability to think critically, while in final-round interviews, the focus may shift to evaluating your communication and presentation skills, as well as your fit with the company culture.

In conclusion, answering growth strategy case questions in management consulting interviews requires a combination of analytical, problem-solving, and communication skills. By developing a structured approach, practicing with sample case questions, and seeking feedback from others, you can improve your chances of success in these types of interviews.

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29 Growth Marketing Case Studies

by Samuel J. Woods

More than anything else, I regularly come across people asking for growth marketing case studies .

It’s one thing to have a list of “growth hacks” and a general sense of growth marketing methodology and process.

But quite another to learn how other companies went from zero to traction, then scale and growth.

Everyone wants to discover what other companies have done successfully. And see what’s possible, across channels, growth processes , “growth hacking”, and growth teams .

But uncovering hidden growth opportunities takes time, effort, analysis, and constant testing.

So, I analyzed and studied how a number of companies did it.

What you’ll see in this article are a wide range of companies—SaaS, apps, marketplaces, e-commerce, platforms.

Many went from small to big, fast.

Here are 29 growth marketing case studies.

Growth Marketing Case Studies Reveal a Variety of Growth Paths

Given the spread in types of companies, you can expect to learn about various growth strategies, tactics, and the path they took toward exponential growth.

Some took years, others took months. But one way or another, they tapped into a market, a need, with a product or service that solved their problems.

Growth Marketing Case Study #1: Etsy

From June 2005 to 2022, craft super seller Etsy went from a concept to nearly 14 billion in sales (in 2021), including more than 4 million sellers and almost 40 million active buyers.

Now, Etsy is a publicly-traded Nasdaq company (ETSY) with a $13 billion market cap.

How did they do it? Here’s the snapshot.

A Needed Change: Craft sellers were aggravated that eBay was so cumbersome, stingy, and seemed to lack care for sellers. These factors created an environment that was supercharged for a platform like Etsy.

They Weren’t Lazy: A marketplace is unique because it requires both buyers and sellers to be successful.

Without awesome products, there would be no need for buyers.

The founders went to every artisan flea market and craft fair to introduce them to the craft-specific selling platform.

Finding Buyers: Etsy was able to tap into a rise in the craft industry fueled by a renaissance of handmade crafters.

Some of these early product creators had built an audience but hadn’t interconnected or listed their items through an eCommerce platform.

Growing Organically: Typically, Etsy only pays for around 2-7% of their traffic (which is insane). This “grassroots” growth comes from getting out of the way of their sellers.

With 150 third-party apps and sellers who are empowered to grow their own business as they see fit, getting out of the way has led to the exponential growth of both sellers and buyers.

Continued Growth: Since its IPO, Etsy has continued to grow rapidly. Now, growth comes primarily through experimentation and a growth marketing strategy handled by teams of people.

Split testing, coming up with experiments, breaking down features, and changing small elements to gauge usefulness and user response has fueled growth.

Key Takeaways from Etsy:

• Having a keen sense of market needs can lead to initial traction and validation.
• One of the best ways to see growth in a new online business is to promote it through physical events to the public.
• Provide the right tool(s) and network with key players (that have an audience that needs your stuff).
• Figuring out ways to empower users to become brand ambassadors is a key to long-term and sustainable growth.
• Large amounts of growth are possible at every level. Strategies may change, and teams may grow, but organized experimentation, failing fast, and setting up processes will help you succeed.

Growth Marketing Case Study #2: Nasty Gal

From 2006 until 2008, Nasty Gal was an eBay business that bought and sold vintage goods for its founder (Sophia Amoruso) to try and make a living.

In 2008, she opened a stand-alone e-Commerce site, and by 2011, it hit $28 million in sales.

The following year, Nasty Gal reported $100 million in revenue and began experimenting with physical locations.

Here’s the brief on how.

Consistent Persistence: Amoruso started an eBay store (called Nasty Gal Vintage) back in 2006 to pay rent. She realized a heavy desire among millennials to dress in vintage clothes due to the unique styles of previous eras.

When she hit what would be a detrimental blow to most (her eBay store was shut down), it didn’t stop her.

That persistence led to an independent site with $28 million in revenue by 2011 (all from vintage clothing arbitrage).

Leveraging Platforms: Using share-worthy style, high margin vintage finds, and a few local models, Nasty Gal built a large following using eBay and social platforms like Myspace (well before Facebook ads).

Her strategy was simple in the early days. She made her models not only look but feel awesome and set out to “…sell things for more than you bought them.”

Perceived Value: Without even knowing what it was, Sophia knew that if she positioned clothing a certain way, it would drive up the price of the early eBay auctions.

Taking decades-old clothing and styling it on the right college-aged model with thoughtful positioning and accessories meant large profits early on and continues today. The way you present can alter the way products are perceived.

Initial Testing: Early eBay was a split-testing ground for Nasty Gal. Testing everything, including the headlines on auctions, the images available, product styles, and putting one article of clothing on several different models to try what hit and missed.

This experimentation led to gains week after week and a store that constantly performed better.

Raising the Stakes: Once the eBay store was shut down, the site came to life with a hefty social following and loyal fans. Selling out of merchandise led to Amoruso seeking a Nasty Gal line.

Through continued experimentation, social presence, and sticking to its core audience, the company has seen incredible growth.

With $100 million in revenue (2015), $65 million in VC funds last year, and two physical locations, the growth is set to continue.

Growth Marketing Case Study #3: Growth Hackers

This look at Growth Hackers will speak strongly to the frustrated founder who has hit a growth plateau.

The company seemingly stalled at 90,000 users. Then, after a little focus and only 11 weeks, that number reached over 150,000.

Get ready for a straight dose of data as we look at how they did it.

High Tempo Time: Testing different growth strategies had slowed, and goals weren’t being met. These two factors led to a stagnant user growth chart and a company not living up to its name. Recognizing this was a huge first step to setting a goal of three experiments per week.

Defining Experiments: The types of things Growth Hackers identify as experiments aren’t just a simple split test (even though those are included). New initiatives, new/revamped product releases, and other things were included to test.

It Takes a Village: A team of people was gathered from around the company to be involved with generating the ideas for experimentation.

The Hackers cited that if one person is in charge of the idea process, the number of experiments to be tested will run out without seeing the type of growth that is desired.

Their efforts resulted in hundreds of ideas that had to be prioritized by potential benefit and ease/speed of implementation.

Pace Yourself (and Meet Often): Some of the experiments took more effort than others (which is normal). However, when these larger tests were run, it caused the crew not to hit their three-a-week goal.

This problem required that they set weekly meetings to identify problems and methodically sort through their experiment list.

The Process Works: Growth Hackers was able to grow the number of users (62,000) within 11 weeks. That same number of users took 32 weeks for the company to attain during launch.

Growth Marketing Case Study #4: Slack

If you love growth stories, you’ve heard of slack. This would-be game company that turned its focus to team communication has received an incredible amount of attention.

From 15,000 users at launch (February 2014) to over 10 million daily active users now, their story is nothing short of amazing.

Here are the highlights of their early traction.

Defining a New Tool: For slack, defining itself was an issue at first. It was when they defined an entire software category that existed(but really didn’t) that they found their focus.

Offices around the world were using dozens of different tools to communicate with other team members and colleagues which made slack a no-brainer to create.

Selling the Dream: Slack is a useful tool, but offices had to be convinced they really needed it (borderline couldn’t live without it).

Since they were able to identify a whole new market, they also had to deal with educating their ideal customers and convincing them it was a need.

Once they were able to get this across, traction came like a flood.

Focus is Key: Early on, the slack founders were influenced to pick out the software’s key features and just do those as well as they possibly could.

Winning big where they won instead of even focusing across the board.

Features weren’t wholeheartedly denied, but an incredible level of care was spent perfecting file sharing and search synchronization (incredibly important to highly connected teams).

Once offices saw the results, word of mouth caused growth to catch fire again.

Give it Away: Slack followed suit of some of the most popular organization apps and offered a free service that was incredibly useful. Teams who saw that value would get the better options to a tune of a 30% conversion rate (free to paid).

A freemium model was a huge factor in the early growth that brought all of the media and VC attention, but the app itself kept paying customers.

Smooth Onboarding: Since it is a useful tool, slack had to be careful not to create a cumbersome learning curve for users.

The development of a simple and intuitive interface that allows teams to be created seamlessly and communicate immediately helped more people hit the ground running.

Growth Marketing Case Study #5: New Relic

New Relic is an analytics company that reveals the deepest secrets of cloud software and apps.

From their start in 2008 until now, they’ve managed to gain 15,400 clients (as of 2020) and monitor over 1 million websites and 1 billion (with a b) apps.

Their customers range from startups to Fortune 500s and government agencies. Their growth is incredible.

So how’d they do it? Here’s how.

Solve a Problem: The basic rule of entrepreneurship is to solve a need, and New Relic knew that they would have to create something great for a market as picky as a development community.

Early traction can almost all be traced by the quality of their product and its usefulness, making their focus on providing an excellent tool worthwhile.

Create Salespeople: Early marketing efforts were heavily focused on not only selling to large development firms but specifically Ruby on Rails programmers.

This approach was different in the sense that New Relic went after people instead of agencies, leading to popularity among those who would actually use their product.

Things like t-shirts for users and meetups led to a sense of community all built around their excellent product.

Give It Away: A freemium model would give skittish developers a chance to view their program’s analytics, enticing them to upgrade to paid.

New Relic’s marketing was simple, convince prospects to sign up and deploy to get a t-shirt and let the product do the rest.

Spending Money: In addition to shirts, the company is spending money on social ads and traffic at a high rate to gain relevant traffic. The brand is also employing multiple tools and SaaS products to gather the data they need to grow even faster.

Addictive Personality: With the product just being so dang valuable, their customers actually get dependent on the insights gained from it.

This need for the data has led to an almost unheard of negative churn rate (meaning their customers spend more year over year).

This rare occurrence happens due to the amount of data created and the space taken up on servers. Talk about growth.

Growth Marketing Case Study #6: Tinder

Shrouded in scandal and misinformation, tinder has a truly fascinating story.

Their growth has come from a mix of newsworthy attention as well as innovation in a stale and competitive market.

From the start in late 2012 until now, they’ve garnered 75 million monthly active users.

All those people use the iconic “swipe” feature over 1 billion times per day.

How much they’re worth and how much trouble they’ve seen maybe cloudy, but the best story is in their growth.

Here’s the snapshot.

Ground Game: Online dating is a notoriously tough niche, but tinder knew what it needed to succeed.

A large number of females using the app would then entice guys to join, but the supply of potential dates had to be there first.

They met this problem from sorority houses, getting girls to sign up one dorm at a time. Next, you just had to tell the college guys there were girls.

Make It Fun: The need for loads of users in each town led to the gamification of the tinder app itself.

By creating the ability to keep “swiping,” you create a sense of wonder and hope that you’ll hit the jackpot with another flick or two. This feature has been a huge factor in the overall success.

Make It Better: Tinder was able to not only create an app in a crowded market, they were able to highlight some common issues with the giants and make them better. Ladies are less likely to get heckled by countless heathens with features built into the app, making more women use (and even enjoy) the app.

Keep Going: To keep people’s profiles fresh and used, tinder continues to add features and tweak them into a more social experience (without losing its core value).

Add-ons like ‘matchmaker’, which allows someone to introduce two friends through the app, or ‘moments’, which allows a user to share edited visuals with matches.

Growth Marketing Case Study #7: Stripe

If you want to create a company that attracts investors like a bug zapper on a front porch, listen to stripe’s story.

A couple of guys (with previous success) managed to create an online payment processor that attracted the attention of the guys who made one of the first (PayPal).

With a current market cap of more than $94 billion, Stripe processes billions more every year.

How’d it happen? Let’s see.

Addressing Elephants: While payment processors existed, they were incredibly cumbersome.

Connectivity and customers were growing at a far greater rate than the ability to take payments. This obvious problem led the three founders to have a simple goal, make it easy for ecommerce businesses to take payments.

Being Different: Figuring out the frustration of other popular processors (PayPal, Google), Stripe was able to develop a platform that was business friendly.

Features that set them apart included the ability for customers to stay on the seller’s site for the entire transaction, and reducing backend features that were confusing and difficult to navigate.

Close Customer Base: Stripe used its surroundings to find it’s first loyal customers. Since the company was part of a community of companies from an incubator, they were able to use that as leverage (most of them needed a payment processor).

Organic Growth: The product spoke well to online business owners and received incredible word of mouth exposure during it’s early days.

To accelerate this advocacy, stripe sent care packages, including shirts and stickers, to developers who used the product. There were also meetups and community events that fostered loyalty.

Constant Improvement: Stripe knows who their customers are and have continuously created new solutions for developers to keep them happy and talking.

From offering specialized support for all popular programming languages, to adding new features, there is always a better stripe in development. They’ve even begun to tackle mobile payments which almost ensures more growth in the coming months.

Growth Marketing Case Study #8: Spotify

Spotify. You’ve probably heard the name. You’re likely one of the 406 million users.

The company was valued at $10 billion in just six years on the market.

Now, it’s publicly traded with a more than $20 billion market cap.

This story is incredible. We’ll take a quick look at the key ingredients to this explosive growth.

Be Different: Music is a giant industry, and the competition couldn’t be tougher.

However, there was a gaping hole in the market. Spotify launched in the U.S. with the simple, yet powerful difference of all the music you want for a low monthly fee.

From a per album and track pricing method to unlimited is almost the definition of disruption. Growth was immediate.

Deliver the Goods: There were other services, but with no options. These early versions were more like radio and lacked to ability to create a soundtrack to your life.

Spotify allowed people to be in control of their music, a feature that many would pay for instead of being fed music.

Free Growth: The freemium model is one often used to help disrupt industries. Spotify does this by delicately placing ads and limiting features as not to upset users or be classified as pirating (70% of ad income goes to song rights holders).

Multiple Launches: Before launching in the U.S. in 2011 (partnering with Facebook which was another huge proponent to early growth), the company beta launched and then officially launched in multiple European countries. These tiered released allowed them to hone their message and buyer personas.

U.S. and Facebook: Launching in the U.S. (after finding their voice) caused Spotify to explode, increasing web traffic well over a million visitors a month within four months time.

Their partnership with Facebook and integrating with the social network garnered another exponential growth session gaining 1 million new users within one month.

Growth Marketing Case Study #9: Airbnb

Necessity may be the mother of all invention, but AirBnB almost didn’t succeed.

Sometimes it takes real tenacity to see growth and it worked out well for the lodging giant.

Now worth $100 billion and responsible for more stays than anyone else in the hospitality industry, this company has seen itself through tough times to sit on the top of an industry in record time.

We’ll give you the highlights.

Hustle Fund: Well before their 450 million in funding, the founders of AirBnB had to raise their own capital. Creating a couple of politically geared cereals (Obama-O’s and Cap’n MCcain’s) the team was able to raise 30k of crucial funds.

Using Your Skills: One of the most questionable factors to Airbnb’s growth is their pillaging of Craigslist.

These gifted developers engineered a solution that was able to pirate both visitors and rental listers from the popular community site.

This tactic isn’t easy and is borderline taboo, but was used to create the largest vacation property site on the internet.

Do What You Gotta: Early on, too many properties were struggling with revenue.

The problem was traced to bad pictures which created less interest. The solution was very hands on; renting an expensive camera and taking high quality photos of every property in New York.

The income doubled and eventually became an expensive (yet effective) program. AirBnB now employees 2000 freelance photographers and revenue has hit exponential growth since the program’s introduction.

Removing Fear: There are obvious concerns when renting your home to strangers (and vice versa).

The company realized that removing fears of those who were interested in using AirBnB (yet hadn’t rented or listed) was a crucial element of growth.

Introducing social integration allowed visitors to see connections and social proof of those who had stayed in a particular location.

Going WorldWide: With so many beautiful locations around the world, AirBnB has started to see another round of huge growth from international stays. This outlet will also be a focus for continued increase in the coming years.

Growth Marketing Case Study #10: WhatsApp

WhatsApp started as a company that stuck to its guns to do one thing (allowing people to message inexpensively) and do it without ads.

This initial goal helped them attract users for the messaging app quickly, but had them second guessing any funding.

After some tenacious VC’s the app now boasts over two billion users and 1 million more daily!

Here’s the brief story of how it happened.

Pivot Power: Most companies don’t reach success offering their service they way it started. WhatsApp started as an app to let others know you weren’t available by phone. This idea failed to catch fire, until push notifications were invented.

This new feature allowed WhatsApp users to alert friends of their status instantly across the world, giving life to the idea for a messaging app.

Principle Power: The app’s founder has a note taped to his desk professing “no ads” among other things. Their product doesn’t use ads and is free for the first year($0.99 cents/year thereafter).

These core principles are still alive and set WhatsApp apart from dozens of competitors aiming for ad revenue and other gimmicks.

Pricing Power: WhatsApp is such a low-cost alternative to many other carriers and services in other countries that international growth is faster than most other famous startups combined (Facebook included). Pricing to scale is a popular feature among startups.

Timing Power: WhatsApp had expenses for the free service that required a paid option. This problem led to the $1 price point it has today, but the timing of the paid option came with an ability to share pictures which meant growth stayed steady.

Facebook Power: The app has been purchased by Facebook, which has more than added to the growth (to the tune of 25 million users a month). However, the change does come with skepticism due to Facebook’s privacy concerns.

Growth Marketing Case Study #11: LinkedIn

Executives, middle class job seekers, and networking connectors love LinkedIn.

Within a year of going live (2003) the networking social platform had half a million users, and the growth didn’t slow down there.

It’s now a publicly traded company (LNKD) that boasts well over 810 million users and thousands of employees worldwide.

Here’s the quick look at their growth story.

Start With a Need: The need for quality prospects on both the employer and employee sides of the job coin warranted a solution.

While there were other options in the early 2000’s, none offered a place for executives and decision makers to find the connections they needed. The opportunity that LinkedIn capitalized on.

Niching Down: While the startup did find resistance in the beginning (tech bubble trouble), they were able to focus on Silicon Valley and find executives eager to fill their sparse staffs with qualified talent and connect with others.

This choice would eventually garner the acceptance of the professional community.

Not So Free: While LinkedIn did remain free, they weren’t making significant revenue from ads. When they added paid features like job listings, subscriptions, and more recently and ad platform, their revenue began to take shape.

Focus on Strength: Monitoring analytics allowed LinkedIn to notice that they were very good at engaging the initial traffic reaching their site, but not as good connecting with a cold email audience. This fact led them to focus on their homepage conversions rather than email, a difficult but effective solution that led to exponential growth.

Testing to Virality: Before the company would concentrate on revenue it had to secure its growth. To do this there was a heavy period of good old growth hacking experiments, tests, and analytics until they reached a planned viral loop.

Audience Before Business: Building a large and engaged community of users before concentrating on revenue gave LinkedIn the opportunity to build a business model around an audience they already knew (and had in their pocket).

This knowledge has led to acquisitions (Slideshare) and content platforms (Pulse) that are driving continued growth.

Growth Marketing Case Study #12: Yelp

If you love a good not-so-underdog story, then Yelp’s story is probably one you’ll enjoy.

In a world of social review sites, yelp managed to rise above some big branded names and boasts over 95 million reviews.

The site received an average of 85 million views in the fourth quarter of 2015 on mobile devices alone.

It started from humble San Fran beginnings and has gone on to become a publicly traded company worth around $5 billion.

Openly Different: Yelp decided early on that reviews wouldn’t be anonymous (like the other review sites). Instead, users have profiles and are empowered to share more reviews becoming a valued member of a community.

Fostering Quality: Other review sites are often full of overly negative and one time reviewers. Yelp has created a system to reward regular reviewers with titles, ranks and other goodies to encourage a constant and accurate stream of reliable reviewers.

Start Small: Starting in the local San Francisco scene, the Yelp team was able to fix issues and gather a tight knit community. Afterwards, it was easier to take on city after city which made growth naturally exponential.

Genuinely User Friendly: So many review sites have to cater to advertisers. The problem with this model is that most ads are for the companies being reviewed (an obvious conflict of interest). However, Yelp has managed to keep the focus on a democratic review system and is seemingly unbiased.

Natural Growth: When you can create a user generated environment that allows visitors to genuinely find the best place to spend their money, you will have the type of growth that Yelp has seen. This growth has in turn spread to the businesses that deserve it. Local places that have the reviews see a jump in revenue.

Growth Marketing Case Study #13: GitHub

Programmers and developers love the idea of open source, but had a cumbersome process to add value and create.

Seeing this need has led GitHub to an incredible amount of success.

From initial traction of 100,000 users in a year, to now having over 73 million active users with thousands more every day.

Here’s how it took shape.

Make Something Easier: The problem with using open source software was the process of downloading, making changes, and then actually seeing them used.

Essentially, it was the entire process that was broken. Creating a hub for git repositories that could easily be worked on and shared was the answer (namely GitHub).

Let It Ride: With developers loving the now easier (but not perfect) way to develop open source, it became a place that offered many new programs.

This supply led to those seeking (demand) and you had a rapid growth process that would eventually be a full audience of people developing solutions and others who needed them.

Making Money: Startups that offer a freemium model often times run into trouble getting users to pay for premium memberships. GitHub had a natural solution come to them. Businesses and other developers wanted a private repository and were willing to pay for it.

This structure created an entirely different membership that the company could charge to use.

Open Popularity: Since open source software is a huge deal, GitHub was in the perfect place to become the poster child of a movement. This position was in some ways deliberate, but in all ways has led to crazy user gains.

Fast Delivery: GitHub doesn’t linger on new features. The developers find a way to deliver things quickly and then work to improve it after feedback. This quality has led to continued growth and loyalty from existing users.

Growth Marketing Case Study #14: Upworthy

While Upworthy may not be a SaaS app, or other type of software tool, its story is just as grandiose.

Scrolling through your Facebook feed you’ve seen posts from this popular viral site (or others who are emulating their success).

Endearing stories, funny videos, or multitudes of other entertaining posts are created to influence social users to visit the site.

Shortly after their launch (in 2012), Upworthy was seeing traffic to the tune of almost 90 million visitors a month (by November 2013).

Here’s how they did it.

Fast Changes: Originally, Upworthy wanted to capitalize on an election year and cover mainly political topics.

The team quickly realized that this material wasn’t getting them the traction that they needed, and switched to other topics that were already popular.

Strictly Wants: Instead of providing a need, Upworthy provides the types of content that people seem to naturally gravitate toward. Instead of text based articles, they concentrate on visual content that speaks to human emotions and behaviors.

Solid Formula: While they can’t bottle virality, they sure are good at it. Their success has come from a solid formula of curating content from around the web as well as a proprietary system of editing and evaluating it.

It essentially comes down to using data to find the content, tweaking (again by using the data), and analyzing it after it’s published (creating more data to use).

Conversions: Without a steady base of social traffic, the site wouldn’t have nearly as many visitors. To gain a steady increase of likes and followers, the team has had to A/B test various methods. These experiments have led the site’s facebook page to nearly 5 million likes since launch.

Emotions Driven: Since the click is performed by a human and the content isn’t a need, emotions play a major role in getting a visitor to the site.

The need to compel leads to tests of material, but more importantly headlines.

The click is the most important aspect so those few words that are shown are the most vital aspect (along with the image).

Future Growth: With mobile being the future, the brand has made changes to make mobile users just as click happy. In addition to mobile, the international market is ripe, but needs different forms of content and more testing is needed to see the growth already achieved in the states.

Growth Marketing Case Study #15: HubSpot

Unless you’ve been under a rock over the past few years, you’ve heard the term “inbound marketing”.

You can thank HubSpot for that. On top of crafting a new term, they’ve become a billion dollar company.

Their story is great for those who have high dollar products, but still want to see rapid growth.

With each client bringing in an average of over $6000, they’ve managed to see incredible gains in a short time.

Here’s how.

Inbound Marketing: It’s no surprise that HubSpot practices what it preaches and uses inbound as an incredible source of growth.

Having multiple blogs (that provide intense levels of value) and a great overall compelling online presence, has given them a ton of success (and continues to do so).

Free Stuff: There are few other sources online (at least for marketing) where you can find so much value completely for free.

Guides, courses, templates, you name it and it’s there. One of their most successful drivers is the free website grader (it search 4 million sites in five years).

Tailored CTA: HubSpot offers multiple types of content (as mentioned), but if you read a blog post, your offer is going to be catered to that topic. Most B2B companies have one guide, whitepaper or resource for their ideal clients.

HubSpot continues their content marketing with content specific calls to action which increases conversions (and growth).

Webinars: Early adopters in the webinar game, HubSpot was able to tap into internet savvy companies and give them free tips in an online presentation.

Webinars are a key proponent of their social growth as well as the overall success of their brand.

Growth Marketing Case Study #16: Evernote

If your company is fledging or even on the brink of shutting down, maybe you can derive a little inspiration from Evernote.

After almost closing their virtual doors, they’ve went on to gain 75 million users and a lot of VC attention (now 225 million).

They had to start somewhere and so do you, so let’s see what factors led to their success.

Surviving Trouble: Evernote was born in the midst of a world of social and new websites (not apps). This early trouble led them to only have a few weeks worth of funds in their accounts at any one time.

Fortunately, a lone user loved the product and at the last available minute wired enough funds to keep them going.

Good and Bad Timing: Evernote launched in the modern app era (2008). There were millions of users ready to download, and not a whole lot of other apps which helped early growth.

The team would also work hard to be in the new app stores on the first day opened. The funding factor wasn’t as good with the economic situation being so awful.

Useful and Impressive: Evernote desired to create an app that could act as your memory, storing anything of any size from anywhere.

On top of that, they wanted an interface that was easy to use, functional and enjoyable. Making something useful and easy are always key metrics for growth.

Freemium: One of the early adopters of the freemium model, Evernote used a basic free version of the app to entice new users.

The genuine usefulness of the product has led to a financial success to the tune of a billion dollar valuation. The value of the product increases with use, and so can the revenue.

Brand Ambassadors: Many companies hope to create advocates for their brand, but Evernote does it. Naming a select few from prominent industries as ambassadors for the app has led to incredible word of mouth and user success.

Meetups are held where the ambassador answers questions and shares the usefulness of the product in that particular field.

Continuous Improvement: In an effort to keep growth levels, Evernote has continuously put out new features and entire apps that make their initial success more useful. Every new product or acquisition has the same goal: to be useful, and beautifully functional which in the end can sell itself (with a little testing).

Growth Marketing Case Study #17: SnapChat

Sometimes your products aren’t used the way you intended and it can lead to problems.

The Snapchat founders understand that, but it didn’t lead to their growth stalling.

In fact, the popular picture/video sharing app has went from starting in 2011 to now having about 300 million users.

Provide Freedom: So often many young people feel the need for expression that can’t be obtained on most social channels. SnapChat offers users the ability to post a very expressive product that is live in real time with no lasting ramifications.

The freedom that comes from the ability to just hop on and share a moment (that won’t last) is a compelling feature that drives both engagement and growth.

Controversial Growth: Meant for colleges, the app found its start in high schools. It seems teenagers were attracted to the idea of messages that could be shared with friends and not be seen by anyone else (and no evidence).

However, the app received negative (potentially unwarranted) early press centered around the new “sexting” phenomenon. Growth continued.

Competitive Help: Facebook saw the popularity of Snapchat as a threat and created their own similar app (called Poke). The attention only gave more fuel to SnapChat’s popularity sending their growth even higher while Poke declined.

Natural Engagement: Due to the nature of the app, messages sent between users are rarely unopened. The wonder of what could be inside makes most open the messages they receive and compels them to send their own. This engagement also creates an excellent word of mouth.

Social Acceptance: More recently, heavy hitters in the online community (namely Gary Vaynerchuck among others) have begun to adopt the platform. This popularity has online audiences running to the platform and sure to equal growth.

Growth Marketing Case Study #18: Uber

Continued growth on an exponential level is a rare thing when it comes to billion dollar brands.

Uber continues to amaze, more than doubling growth year after year even after they boast a $63 billion market cap.

Not to mention they’ve done all of this since 2009 starting out as a small local service.

Let’s take a brief look at how they accomplished so much.

Monopoly Buster: Cabs are terrible. Uber fixes that problem. While it’s not perfect, this new transportation method has become the very face of modern business disruption.

The added bonus of shaking an industry is not only the joy of being useful, but the media attention (negative and positive) that further fuels growth.

Strategic Launch: If you’re going to provide a service, it’s best to give it to those with platforms. Choosing San Francisco to be the first Uber city was a strategic choice.

A place of notoriously bad taxis and people who loved new technology and had blogs and audiences of their own (people like Tim Ferris).

Driver Love: Obviously, the travel brings the revenue. However, Uber understands that they are a liaison service between two parties (one being the driver). With better pay and putting laid off drivers back to work they created instants advocates in each new city.

Focused Launches: Each city isn’t just an expansion for Uber, it’s a new place to dominate. Taking each new location seriously has led to continued growth.

This tactic doesn’t mean slow growth, they have expanded rapidly as well as meticulously across the globe.

Testimonials: Word of mouth is still one of the biggest growth drivers in the world, but Uber gets it from those who have used their service. By someone sharing their experience with someone else (a testimonial) it becomes even more compelling.

Uber also gives free rides to have more and more people telling their story.

Creating Wow: Uber loves testing different experiences for their customers. Trying to ever improve the ride has led to some great experiments and an almost guaranteed good time across town (which creates more testimonial situations).

Growth Marketing Case Study #19: Belly

Everyone hates it when customers leave. The average churn rate of a company can destroy growth.

Belly Card started out to help small and medium sized businesses increase the retention rate of clients.

A unique business model that isn’t well known, but has over 1 million users and 5000 business clients.

The neatest part about them, is that it all happened in about 15 months!

Market Research: A key driver to growth is starting with something valuable. A lot of times it’s a hunch from a founder, but not in the case of Belly. The team hit the pavement and talked with hundreds of merchants to figure out how to improve customer loyalty for local businesses.

Getting It In: After creating the product to help, they got to work. Selling in person, on the phone, and other “traditional” methods helped get them their early traction and user base. Belly worked Chicago until people and merchants were talking about their service.

City by City: With a few successful city launches under their belt, the Belly team was able to roll out that strategy in new cities with the same success. Soon after, the word of mouth took off as users and merchants loved the engaging elements (gamification) that the product provided.

Selling by Data: While national chains of independent owners are a lucrative market, selling the owners equals a slowed rate of growth and selling to the chain may not be as effective either.

However, Belly was able to take the data of the independent owners that were already using the programs (places like Subways and Chic-Fil-A’s) to entice the chains to use the service.

This process would increase sales for Belly and (in most cases) chains/franchisors as well as garner loyalty for the owners themselves (win-win-win).

Growth Marketing Case Study #20: Square

Software companies can be one of the most attractive-looking ventures, but Square was able to do something different.

The company applied a payment processing company behind an attractive and conversation-starting trend centered around their hardware.

The growth is amazing, from starting in 2009 to being one of the most popular small business payment processors with more than 8000 employees.

Here’s a quick look at how they gained traction.

Needed Change: Square makes it possible for anyone to take credit payments. With the hardware (see next point), it had never been easier for small businesses to take multiple forms of payments and sell more stuff.

Whether it would be at flea markets, or in their home office everyone could take credit. Something that was needed and wanted and that created an environment for growth.

Physical Hardware: One of the most revolutionary things about Square is the invention of it’s iconic credit card processing hardware. It’s simple, easy and opens up credit payments to a world of entrepreneurs and business owners.

The company is still doing this with iPad integrations and register POS systems today. The wow factor and talking points definitely helped them with early traction.

Happy Customers: In addition to small business owners getting an easy way to take multiple forms of payments, they like it for other reasons too. Not only is the product useful, but incredibly attractive and hip.

Business owners often know others like them, fueling the number of people who are using the new device (and the processor of course).

Founder Foundation: Jack Dorsey (also cofounded Twitter) was an obvious piece to the early growth of the platform. It wasn’t just his name, but his approach. He wrote a list of those who may be interested in funding the startup.

The list laid out 140 reasons why the company may fail as well as their counterpoints. The gimmick worked and it has garnered significant investment and popularity.

Growth Marketing Case Study #21: Canva

Back in the day, if you needed to come up with a flyer, a banner, or any design and you weren’t a designer, you had two options.

You could hire a designer or you could go through the painful process of doing it yourself on PowerPoint, or worse, use Word art.

Today you have Canva, which completely revolutionized basic graphic design for the average person.

Here’s how they’re growing.

Making it easy for everyone: There have always been other options for creating quick designs. But they had several shortcomings either in the way of UI, price, or ease of use. And these were the main things that Canva focused on since it launched.

The user interface was intuitive and had usable templates. It was web-based, so there was no need to download and install the software.

And most importantly, the free version was useful. So it was no surprise that Canva quickly became the de facto tool for anyone looking to do some quick design tasks.

Simple Pricing combined with a clear value proposition: An important aspect of Canva is that it made it easy for its users to choose to upgrade to the paid version.

The free version served the purpose of letting first-time users familiarize themselves with the platform until it became a part of their workflow. When that happened, it was a simple choice for users to upgrade to the paid version for additional features.

Also worth mentioning is that compared to their competition at the time, their pricing was in a goldilocks area for their key users.

From 0 to 15 million users: Canva’s first two years saw an impressive amount of growth. They went from 0 to 2 million monthly users.

And after seven years, they reached 15 million users, 300 thousand pro users, and are now a 3.2 billion-dollar company. To reach this massive amount of growth, they went about it with the tried and true formula of having a great product match for their audience and consistently investing in paid ads across the usual social media channels.

Growth Marketing Case Study #22: Airbnb

The word disruption is used fairly loosely nowadays. But in reality, very few businesses disrupt an industry.

Airbnb is one of the few which have. And in doing so, they grew from a three-person operation making a couple of hundred bucks a week to now reporting over 1 billion in quarterly revenue.

Today, Airbnb is a 35 billion dollar behemoth with hundreds of employees and a global presence.

Here are 6 takeaways on how Airbnb grew its business.

• Test your idea and iterate. Initially, the founders tried to make extra money by renting a spare air mattress. They took the same concept and iterated until they found the winning formula.
• They focused on finding what the bottleneck to their growth was. At first, it was about the images of the properties; later on, it became payment processing. As they kept on growing, new growth problems were solved.
• They bootstrapped and started small. Many new businesses want to immediately get funding to accelerate their growth. This is not necessarily wrong. However, AirBnb already was bringing in profits and had a working product by the time they took on venture capital. This made it significantly easier for them to raise capital and acquire investors.
• They took over the industry by being themselves. Airbnb didn’t set out to compete with hotels directly. In the beginning, they offered a more affordable option for travelers, but what really set them apart was the fact that they were selling the experience of living in the place you were visiting instead of being a tourist as you would be with a traditional hotel.
• They take care of their customers. One of the critical aspects of Airbnb is how the platform takes care of all its users. Airbnb offers a big insurance policy to their hosts so that they can have the confidence to rent out their properties.
• Upsells and cross-sells have become a major source of revenue. Instead of limiting themselves, they decided to listen to their customers and incentivize their hosts to offer additional services that would help them increase their income. A win, win, win type of deal.

Growth Marketing Case Study #23: Koala

In 2015, Koala made waves as one of the most successful businesses to launch in the recently created direct-to-consumer mattress space.

It quickly grew up to $13 million in sales in its first 12 months of operating.

During their first year, the team behind Koala did something that let them accelerate their growth. They had a laser focus on the digital marketing channels that brought them the most results.

Here’s a brief breakdown of how they went about strategizing their growth.

Have a great product and an amazing offer: To start off, Koala launched with a great product that was highly competitive compared with the traditional market. But what set them apart was the quality of the offer.

The offer was miles ahead of what their competition had at the moment. This is where free delivery, pickup, and a 120 free trial with no strings attached set them apart.

This amount of confidence in their product helped with making it easier for new customers to choose the new and innovative mattress company.

Laser-focus on what works: During their first year, Koala approached their marketing with a laser focus on one marketing channel: Facebook.

Instead of spreading themselves thin by diluting their budget across multiple channels, they decided to concentrate their efforts on dominating their chosen platform.

They did this by investing heavily in creating exciting and eye-catching ads and making the most out of Facebook’s retargeting capabilities.

This is why if you spent any amount of time browsing Facebook back in 2015, you probably came across an ad or two from Koala.

Make it easy for your customers to talk about you: The direct-to-consumer mattress business was still new and didn’t have widespread adoption back in 2015.

To address the novelty aspect of their business model, they relied heavily on having established processes that made it easy for their new customer to share their experiences.

Customer testimonials make a huge amount of difference for new businesses. They essentially shorten the amount of time needed for a new customer that is still on the fence about whether or not they want to try a new product.

Growth Marketing Case Study #24: Hip Kids

Hip Kids is a children’s toy company that carved out a niche for itself by offering a more high-quality and durable alternative to the primarily disposable toys that are commonplace in the market.

This singular attention to detail and alignment to their core values helped them take their company to the 7-figure mark in sales.

But they reached a point where, even though they had a healthy marketing budget, they just weren’t seeing the growth they expected.

This is what they did to triple the revenue and spur growth for their already well-established brand.

Define the root cause of the problem: To understand the root cause of the problem, a little context is necessary.

HipKids started as an eBay store about a decade ago. They started small, and as the demand for their products grew, they were able to open up their own website and even open up a few physical locations for their brand.

Due to their organic growth, they added additional pieces to their marketing one at a time, and often from different agencies.

First they did their website, then they added an in-house designer, then they went with a PPC agency to get targeted traffic, and finally, they also invested in their SEO.

As you can imagine, after investing in each new marketing channel, they saw an initial spur of growth that quickly stagnated. It was this fragmented approach to their marketing strategy that made it difficult for their campaigns to work in unison and build up the momentum they needed to reach their growth goals.

Efficiency and optimization are key: Once the problem was defined, it became a matter of restructuring their marketing team to make sure that it was all moving in the same direction.

With a brand new marketing structure set in place, then it was possible for the marketing team to work on optimizing their campaigns and iterating over time to attract new traffic and improve conversion rates. This is what ultimately let HipKids triple its revenue.

Growth Marketing Case Study #25: Dropbox

Dropbox has spent very little on advertising but has grown the company to $4 billion. This article shares some of Dropbox’s top techniques, specifically through word of mouth.

A decade ago, the internet was very different. To start off, it was much slower. The average download speed was only 5 Mbps.

Today, you’ll often find speeds 20x faster just about anywhere, even on mobile phones.

Due to these limitations, sharing and storing large files on the cloud was challenging and often expensive.

Cloud storage was mostly directed to businesses, and the consumer-level solutions available were clunky and unfriendly to the average user.

That is until Dropbox entered the market.

Tried and true old-school tactics: Even though Dropbox is a huge SAAS, it’s interesting to know that its initial growth did not rely on advertising of any form.

They went to the old school method of using word of mouth from their customers to reach the growth they were after.

The most valuable resource back then was storage space. So they gave out storage space to their existing customers so that they could motivate them to share their experiences with Dropbox.

This approach worked wonders, and Dropbox’s revenue quickly exceeded the $100 million mark.

Make it easy for your users: Dropbox wasn’t the first or only consumer-level cloud storage option in the market. But it was by far the easiest. Most of their competition, even those that were in the market before them, had cumbersome interfaces and poor customer support which made it difficult for users to sign up for their services.

Most of them had ads on their signup pages, so yes, it was ugly.

Dropbox, on the other hand, had a clean signup page that made it easy for users to sign up. Nothing unnecessary, and no ads were found on the signup page.

Incentivize sharing on social media: Back in 2011, social media reach was very effective in driving traffic. So to take advantage of this, Dropbox incentivized social media shares with free space. This worked out to be the perfect complement to their referral strategy. It decreased the friction in sharing and made it highly attractive for their existing users to become brand ambassadors.

Growth Marketing Case Study #26: Dollar Shave Club

The marketing behind razors, up until the launch of DSC, was pretty consistent. Every “new” razor offered the exact same thing, a better way to shave.

And it worked to some extent because razors are an everyday product for a lot of people.

They just ended up buying them the same way they had always done.

Dollar Shave Club didn’t innovate the product they sold. Their product is, albeit high quality, just about the same as everything else in the market.

So why did they become so popular? Because they innovated the experience.

Make your marketing fun and memorable: Dollar Shave Club’s initial marketing was nothing short of genius. It was fun, and it was memorable. It was a welcome departure from the idealized and mostly non-relatable approach that the traditional brands had embraced decades ago.

This more honest, down-to-earth, and witty approach gave them something that the other brands didn’t have. It gave them a relatable personality.

And the consistency of their personality across every aspect of their brand made them feel reassuringly consistent and was enough to help them differentiate themselves from the rest of their competitors.

Create an experience: Since innovation on the product side of things wasn’t much of an option, they decided to innovate on their customer’s experience.

The first hint of this is in their name. Dollar shave club is exactly what they are. They’re a club, something you can be a part of.

And this feeling of inclusion and community, paired with the direct-to-consumer model, made the experience of getting your razors from Dollar Shave Club highly attractive.

Get customers for life: One of the biggest drivers of growth behind DCS is that they have an incredibly long ratio of lifelong customers. Simply put, their business model makes it easy for their customers to want to keep on buying from them.

It’s a simple and straightforward subscription model that most users can get on board with.

This is what ultimately helped them reach a $615 million dollar valuation and ultimately be bought out by Unilever for $1 billion in 2015.

Growth Marketing Case Study #27: Casper

Casper is one of the best examples of how changing and improving the customer experience can revolutionize a segment.

Before Casper, if you were in the market for a new bed, you had to go to a physical location and well put up with being sold to.

That’s one of the reasons why so many people put up with an uncomfortable mattress.

The physical pain of a bad mattress wasn’t as bad as the pain of having to deal with the pain of going through all the hoops of buying a new mattress.

Casper changed this and led the way to a new trend of direct-to-consumer mattresses that revolutionized the entire sleep industry.

Understand your customer’s true pain: The traditional dealer-distributor model that has been in place for years made it so that buying a mattress was a less than pleasant experience for most customers.

It’s a model where salespeople were incentivized to sell but, unfortunately, got the reputation of using sleazy sales tactics.

Casper understood that this was the real reason why people wouldn’t buy a new mattress. They just didn’t want to go through that process, even though their old mattress was uncomfortable and even caused them health problems.

Casper gave its customers a much more viable alternative and had a high-quality product that their customers would be willing to try out.

Address all your customer’s concerns: One of the main challenges was to change the customer’s perception that they had to try-before-they-buy a mattress.

They tackled this head-on by offering an incredibly bold satisfaction guarantee and by providing plenty of educational content on their products so that customers could feel confident in their buying decision.

Then they followed up their product with SEO content centered around sleep and how it impacted health so that they could further establish themselves as sleep experts and gain their customer’s trust.

Leverage customer reviews: Casper did a great job at leveraging its customer reviews. They made it one of the central aspects of their retargeting and email marketing campaigns. Customer reviews are powerful tools since they provide a seemingly unbiased perspective of your product.

Growth Marketing Case Study #28: Groupon

Everyone loves a great deal. It’s a simple concept, and Groupon leveraged it to go from zero to having a $12.7 billion IPO.

Equally impressive as their valuation is the rate at which they were growing on a yearly basis. To reach this huge amount of sustainable growth, they relied on a few tried and true growth tactics.

These tactics are so effective that you’ll see that several other businesses in this article followed them to great success.

This means that you don’t necessarily need to reinvent the wheel but rather spend your energy on making it turn as fast as possible.

Make sharing easy: Groupon is, at its core, a social platform. And as such, it makes it very easy to be social. Groupon has always made it easy for its users to share the deals that they are interested in.

It incentivizes it because if not enough deals are taken, the deal won’t be available. So it adds an element of scarcity and perceived exclusivity.

So when FOMO kicks in, Groupon users become highly motivated to share on their social channels and increase the likelihood of their deals coming to fruition.

This, in turn, has the benefit of making sure the Groupon brand is consistently shared.

Email is still very powerful: For some reason, there’s always someone stating that email is dead. That inboxes are too cluttered and that no one pays attention to them anymore. This couldn’t be further from the truth, and Groupon knows this. This is why they have made email a key part of their marketing.

It’s important to understand that if someone voluntarily signs up for your emails, then they are giving permission to reach out to them.

Groupon makes the most out of this by sending daily emails with highly valuable content.

Copywriting makes a big difference: The quality of how you communicate with your customers makes a big difference in how effectively you can retain their attention. Groupon learned this early on and has characterized itself by sending interesting and fun-to-read emails.

It’s important to remember that nobody likes boring and bland content. Your customers will read what you have to say, but only if it’s well written and grabs their attention.

Growth Marketing Case Study #29: Porch.com

The home improvement market is enormous. It’s $500 billion and continues to grow at a steady rate.

So it was only a matter of time until a startup would try to revolutionize a market that had historically lacked innovation.

Enter the Seattle-based Porch.com. In 2013 porch set out to become the “Uber” of home improvement projects by helping connect construction professionals with homeowners that needed help in completing their tasks.

Amongst its achievements, Porch.com can mention:

• 300000 active professionals across the US.
• Nasdaq IPO in the year 2020.
• They reach approximately 66% of the homeowner market.

However, back in 2018, before they went public, their growth had started to plateau. Something had to be done. So they made a concentrated effort to improve their search engine visibility so that they could get a more sustainable and cost-efficient source of traffic. To achieve this goal, they went with the tried and true strategy of increasing their backlinks.

Link building can be transformative for your traffic: The reason why link building was chosen is that since they had started to rely on paid advertising for their lead acquisition, their cost per lead had started to increase.

This rise in cost per lead was eating into their profit margins, so from an ROI perspective, investing in cultivating high-quality backlinks was a good strategy to follow.

Porch’s marketing was able to obtain over 931 backlinks from unique domains throughout the year. This helped them make a significant boost in their organic traffic and helped decrease the total cost of their lead acquisition.

Here are some of the growth strategies they followed:

• They didn’t limit themselves to home renovation topics but rather created content across a broad range of related topics to expand the number of high-quality websites they could be relevant to.
• This broad range of content helped them land mention on television and local radio across several major cities.
• Some of the results generated by the campaign were 257 mentions from relevant publishers, 180 regional media mentions, and over 38000 social shares.

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Six strategies for growth outperformance

Growth is the lifeblood of any successful business, but achieving growth that is both profitable and sustainable has proved especially difficult in recent years. Business leaders need a strategic approach that combines courage, innovation, and a willingness to make bold moves. In this episode of the Inside the Strategy Room podcast, McKinsey partners Rebecca Doherty and Kate Siegel and senior partner Jill Zucker share their insights on how companies can grow faster and more consistently than their peers. This transcript has been edited for clarity and length. For more discussions on the strategy issues that matter, follow the series on your preferred podcast platform .

Sean Brown: This may seem like a naive question, but why does growth matter?

Jill Zucker: Growth drives performance. It drives culture. It drives employee satisfaction. It helps you retain the best talent. And it fosters innovation in the marketplace. But it’s important to grow profitably. Top-line-only growth tends to catch up with you over time. And while most organizations aspire to grow, we find that growth is quite hard to achieve. Only 25 percent of companies grow sustainably over time. But if you can achieve it, that growth is rewarded, with sustainable growth outperformers generating seven percentage points more annual total shareholder returns than their peers.

Sean Brown: What does it take to be a growth outperformer?

Jill Zucker: We studied what drives growth at more than 4,000 companies around the globe, and we found a set of ingredients that are true across industries. We recognize the challenges that companies are facing today because of the global economy, so our research spans a period of ebbs and flows in the economy.

The first thing that we found is that it’s important to wake up in the morning and actively choose growth. We meet many executives who say they want their companies to grow, but they don’t allocate resources to support that growth over time.

You also need the courage to make bold moves, even in a time of economic uncertainty. In previous decades, you could choose not to pursue growth in a temporarily challenging environment. These challenging events, however, have become so pervasive that we need to have a through-cycle growth mindset. During the financial crisis, the gap between those companies that chose growth and those that stuck to maintaining the core business was reasonably narrow, but as the economy settled, that gap significantly widened. You saw a much steeper growth curve among those that had made bold bets during the downturn.

Sean Brown: How do you ensure that the pathways you choose lead you to the intended destination?

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Jill Zucker: You need to lay the foundation for more dynamic resource allocation, by which we mean both capital and talent. It means being careful in your culture to shut off projects without shutting off the talent. Just because a talented executive pursued a good experiment that didn’t work out doesn’t mean the executive should leave. Talent remains scarce in many business areas, so it’s important to allocate it to growth projects. It also means allocating resources to areas you are convinced will grow and eliminating the hobbies.

Secondly, you need to think about inorganic opportunities—both acquisitions and divestitures. The third part of the foundation is building functional capabilities, whether it’s marketing or digital or innovation.

Sean Brown: What strategies do you find growth outperformers pursue?

Rebecca Doherty: We looked at what companies have done both during the uncertainty over the past five years as well as over the longer term and found six differentiating strategies. One of the timeless approaches is to continue innovating in the core. Eighty percent of growth comes from maximizing the value of your core [exhibit]. But that’s not enough to put you in the echelon of companies that achieve growth on a sustained basis. To achieve that remaining 20 percent, you need to move into adjacencies in your value stream, such as new geographies, and build breakout businesses.

The third timeless element is putting people at the heart of what you do, whether it’s day-to-day growth or a broader transformation. Having your core people involved in growth initiatives with an ownership mindset is critical.

The three strategies that have emerged in more recent years include building an innovation culture , using sustainability as an accelerant to growth, and portfolio reallocation, including what we call shrinking to grow. The bold moves you make could include divesting assets where you may not be the best owner and then reallocating those resources toward growth opportunities.

Sean Brown: You talked about the timeless growth strategies. What makes them timeless?

Rebecca Doherty: The ratio of growth that comes from the core versus adjacencies or breakout business is pretty consistent over time. We’ve also found that companies that grow in all directions over a ten-year period have double the chance of outperforming their peers.

Sean Brown: How do the strongest growers embed an innovation culture?

Rebecca Doherty: We ran an executive survey of more than 1,000 companies, and I was surprised, frankly, to see how important innovation is across all the growth paths. Historically, people think of innovation as a way to turbocharge the core business. But leading growers look just as much at innovating new offerings and permeating that mindset through the company.

Sean Brown: Many companies still see sustainability more as a cost than a growth generator. How do you envision it accelerating growth?

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Rebecca Doherty: We’ve found that if you already have growth and profitability in place, sustainability can be that extra punch  that gives you a lift over your competitors. Sustainable growth is not a substitute for profitability, but companies that have been able to embed sustainability in their businesses have been rewarded. Perhaps intuitively, those that deliver growth and profits show a five-percentage-point outperformance in TSR. If you add ESG [environmental, social, and governance] into the mix—and this isn’t dabbling but integrating ESG priorities into your strategy and sharing the messages with investors—you see seven points of outperformance. In some sectors such as retail, you have brands that have brought sustainability into the core and have done strings of acquisitions over the years to drive impact.

Sean Brown: How do you balance the bets on breakout or adjacent growth against building up the core? If 80 percent of the growth comes from the core, should that much of your investment go there as well?

Rebecca Doherty: It depends in part on the maturity of the business and where you are on the growth curve. If it’s early, you should focus on propelling that core growth strategy. If it’s a mature business and you’re only making incremental gains, maybe you look to invest beyond the core. How much you invest does matter, though. Companies sometimes simply take last year’s budget and tweak it by a few percent. For a breakout business, sometimes you need to invest more—and not just more money. I worked with one company that put its chief technology officer into the new business to help grow it. The initial investment in dollars wasn’t large but the investment in talent was.

You should also think about the investment in stage gates. Some bets may require a large up-front investment, and you will not see much revenue for a while. Others, you could start with smaller investments, and the funding could grow proportionately with revenue. Different profiles can work, but it’s important to have a sound business plan, understand the operational and financial milestones, and be willing to pull the plug if it’s not panning out—which is a bold move in itself.

Sean Brown: Reallocation of resources includes both people and capital, but people tend to have incentives. How do you maintain incentives when you’re moving somebody from a stable business into a riskier growth project?

Rebecca Doherty: It ties to what Jill said earlier: a failed business doesn’t mean a failed executive. The culture needs to reward risk taking, and management has to accept that you won’t have 100 percent success. In terms of incentives, you can align an individual’s incentives to delivering the project, but also implement incentives that reward thinking about what is best for the broader company.

Jill Zucker: We see some management teams reward managers uniformly on EPS [earnings-per-share] growth of the business or total shareholder return, and therefore whether you’re innovating or you’re maximizing the core, you are rewarded equally. It’s not about giving more money to one person or another but about what will grow the total shareholder return. This encourages managers to give up some capital for innovation if they believe that doing so will improve the company’s growth.

Sean Brown: Can you elaborate on how companies should pursue growth through adjacencies?

Kate Siegel: Finding growth outside your core business is challenging, so we looked at how growth outperformers approach adjacencies. Our sample was about 250 companies that had announced significant adjacency moves over the past 20 years. We found four types of rationales, or approaches, that underpinned these moves. The first was based on customer relationships and the knowledge of customers’ pain points. The second was capabilities, where companies could use their existing assets, people, or processes in new markets. Expansion into the value chain—going upstream or downstream to capture various synergies—was another rationale. The last one was finding opportunities for disruption and business model innovation. What’s interesting is that the more approaches they used, the higher the reward, and that included both outperformers and other companies.

Sean Brown: How do companies identify those adjacencies? Is it based on experience and team discussions, or do they use tools?

Kate Siegel: There is a variety of data you can scan on trends, technologies, changes in preferences. You can also consider similarities of your offerings to certain businesses and capabilities. For example, we recently helped a software company that was struggling with high competition find diversification opportunities. We used AI to scan unstructured online data to identify more than 500 growth ideas based on the value creation approaches . Another set of AI analyses helped prioritize the opportunities based on trends, news mentions, momentum, and patent intensity to give the management team a short list of ideas. The company then considered which were the best fit, what talent they would need, or whether the market was big enough. One of these ideas was one they hadn’t talked about before. AI is a powerful tool for challenging orthodoxies.

Sean Brown: One strategy we haven’t yet touched on is shrinking to grow. What does that mean?

Kate Siegel: We know only about 10 percent of companies are able to maintain positive growth rates across a decade. But suppose you don’t have this consistent growth engine. The next-best strategy is to periodically prune back your portfolio and then grow healthily from a new base. You divest parts of the business one or two years out of the decade, but in every other year, you grow from that new base. We’ve seen that work in some conglomerates, where they regularly look at their portfolio to see if there are less attractive assets they could divest and then reinvest the proceeds into ones that could be better platforms.

Sean Brown: What if the businesses you want to prune have some star performers? How are companies thinking about that talent dimension?

Kate Siegel: Divestitures typically have key-member clauses to ensure business continuity, but you can take steps to understand which talent you would like to retain. The worst thing you can do is not think about talent when you sell a business, because it could have the best technology officer for a new growth entity you plan to reinvest in.

Rebecca Doherty: When we consider an acquisition, we often think about it as one plus one equals more than two. Likewise, when we think about divestitures or spinouts, it’s usually not two minus one equals one, because you’re not the best owner of the business, and someone else might be, or it might flourish on its own. Separations might not only give you proceeds to reinvest but also help the other entity perform better.

Sean Brown: Once you have laid out the various growth paths and developed strategies, you need to execute them well. What does excellence look like for execution?

Kate Siegel: People are at the heart of a successful transformation. Transformations that activate the full organization are eight times more likely to succeed. In addition, those in which more than 20 percent of employees owned transformation initiatives saw nearly twice the excess shareholder return than their peers did. Once you have the right aspiration mindsets and culture, with clarity on the growth pathways, the most important thing is to involve as many people as possible in the growth effort. That includes getting everyone aligned on the growth aspiration, building the skills they need, having leaders consistently talk about the growth targets, and implementing processes to verify whether the bets are working.

Sean Brown: Are you optimistic that companies can revive growth?

Jill Zucker: There is not a single company I can point to that’s not focused on growth today, despite the economic backdrop. When I think back to other periods of economic uncertainty, the hunkering down, the fixation on the core, the focus on efficiency were much more at the forefront. Now, growth remains a priority.

Jill Zucker   is a senior partner in  McKinsey’s New York office,  Kate Siegel  is a partner in the Detroit office, and  Rebecca Doherty is a partner in the Bay Area office.  Sean Brown is global director of communications for the Strategy & Corporate Finance Practice and is based in the Boston office.

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Getting Started With Business Process Transformation: Free Starter Kit, Use Cases, and Case Study

By Courtney Patterson | September 18, 2024

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Business process transformation is the strategic overhaul of workflows to boost competitiveness for long-term success. We’ve gathered expert advice and real-life examples of how companies can best plan and implement business process transformation.

Included in this article, you’ll find the following:

• Frameworks for approaching business process transformation
• Phases of business process transformation
• Steps to implement business process transformation
• Business process transformation starter kit

What Is the Business Process Transformation Process?

Business process transformation (BPT) is the complete redesign of how a company works to make it more efficient and effective. It involves overhauling key processes, reimagining goals, restructuring teams, and updating workflows and delivery methods. With BPT, companies can improve operations at every level and achieve business goals.

Business process transformation is one part of business process management (BPM), which, as the authors of this 2020 study in the European Journal of Information Systems explains, involves identifying inefficiencies or redundancies in processes and workflows and streamlining them for better organizational growth .

“The entire concept can be boiled down to a simple formula: new business demands + updated technology systems + talent + culture change = business process transformation ,” writes Forbes Councils Member Daragh Mahon in 2021. This is very similar to business process re-engineering , where companies also revamp processes, cultures, and systems for better workflows and satisfaction. Business process transformation more often involves incorporating digital tools and new technologies, but the two terms are sometimes used interchangeably.

Businesses might undertake business process transformation in order to grow their profit margins, lower their costs, or increase their competitive advantage. Whatever the case, the bigger objective is to cultivate additional value — through people, processes, and technology — and improve customer experience by better adapting to market demands.

Why Is Business Process Transformation Important?

Business process transformation is important because it helps companies improve their operational efficiency by reducing costs and streamlining workflows. It also helps businesses adapt to changing market conditions, which improves customer satisfaction and loyalty.

Business process transformation often involves integrating technology and data analytics into workflows. This helps companies make more informed decisions and reduces uncertainty. Improved processes can also mitigate risk and ensure compliance, as well as improve employee satisfaction.

Business process transformation can benefit a company in a number of ways:

• Cross-Functional Collaboration: Business process transformation promotes communication and collaboration across departments by encouraging a holistic view of workflows, rather than focusing on individual tasks. Large-scale transformation requires teams to agree on shared goals, use common platforms, integrate their systems, standardize their processes, and merge their data.
• Cost Reduction: Business process transformation can streamline workflows, reduce waste, and optimize resource utilization, all of which improve operational efficiency and reduce overall costs.
• Customer Experience Enhancement: Transformed processes should lead to better-quality services in the long run. By streamlining and optimizing workflows, these transformations often result in shorter overall wait times for customers. Additionally, enhanced data analytics that result from business process transformation help personalize customer experience.
• Increased Productivity: Automation of workflows allows employees to engage in more creative or strategic work, which makes better use of their skills.
• Informed Decision-Making: Digitized processes generate more data that can be leveraged for better insights. Businesses using artificial intelligence (AI) and machine learning to make better use of their data can reach more informed decisions and predict market trends more accurately.
• Market Adaptation: Business process transformation enables companies to respond and adapt to changing market conditions. For example, an efficient shift toward remote work processes and workflows during a global pandemic ensures that a company stays competitive.

When to Go Through Formal Business Process Transformation

It’s important to remember that in the general sense, a company is never done transforming, but undergoing targeted business process transformation is not always the right decision. Whether it’s the right time to undertake process transformation depends on a variety of internal and external factors, such as increased competition, process bloat, or new technology.

These are some common reasons for a business to undergo a transformation:

• Digital Transformation: A company may undertake digital transformation even if its technology is not outdated. In this case, business process transformation may be required as part of a broader digital transformation strategy.
• Changing Market Conditions: Evolving industry trends, global events such as wars or economic recessions, changes in government regulations or compliance requirements, and other market conditions may require a business to transform its processes.
• Bloat: Operational inefficiencies, or excessive waste in business processes, call for transformation to ensure that a company can stay relevant and competitive without incurring losses. If a business is losing time, labor, or raw material due to inefficient workflows, process transformation will help reduce waste.
• Competition: If competitors are outperforming a company, process transformation may be necessary to improve efficiency and regain a competitive edge.
• Growth: When companies expand into new regions or countries, move into new product markets, or acquire or merge with other companies, business process transformation is required to accommodate new requirements, customer preferences, or organizational cultures.
• Customer Experience: When a business feels it needs to reaffirm customer satisfaction and loyalty or improve its draw among potential customers, it may transform its processes to better meet customer needs and expectations.

Business Process Transformation Frameworks and Strategies

Using existing frameworks for business process transformation can save time and reduce risks. Examples include McKinsey & Company’s 7-S Model, the Prosci ADKAR Model, Lewin’s Change Management Model, and Kotter’s 8-Step Change Model. Each has its own approach to guiding organizations through change and addressing different aspects of the transformation process.

According to Varun Grover , Co-Editor of Business Process Transformation and Distinguished Professor at the Walton College of Business, University of Arkansas, there are, historically, two distinct ways of thinking about business process transformation: one focusing on cost, and the other on revenue.

The more popular model in the early years of transformation focused on cost — making processes more efficient, cutting costs, and eliminating workers. “In the later years of business process transformation, the focus was not so much on cost and slashing people, but on revenue,” Grover says. “How you differentiate your product to generate more premium and how you create more value for customers.”

These are two distinct strategies or frameworks. “Cost focuses on streamlining, so a company focused on costs will evaluate its different components and say, ‘Are we generating enough return?’ Your focus is on highly efficient facilities and cutting out marginal accounts,” Grover says. “A company focused on differentiation is focused on uniqueness. How do we create it in our people and our processes? These two strategies contradict each other. If you’re focusing on costs, you’re focused on streamlining; when you're focusing on differentiation, you want uniqueness, and uniqueness comes at a cost.”

The difference between these two frameworks depends on a number of different factors, including a company’s strategic timeline and its size. “Public companies in the United States are very sensitive to their shareholders. They have a fiduciary responsibility to their shareholders to show profit. And the cost-focused strategies tend to be more low-hanging fruit,” Grover says. “Reduce costs to show more profit.”

The revenue-focused strategies are longer-term. “That requires innovation,” Grover says, “building this uniqueness, creating a proposition that’s compelling for your customers and your markets.”

These well-established strategies for organizational change could also be adapted specifically for business process transformation:

• McKinsey & Company's 7-S Model: The McKinsey model emphasizes the interaction and combination of seven key factors for effective transformation: strategy , or the company’s plan for achieving its goals; structure , or the company’s hierarchy of talent; the staff working at the company and the skills they demonstrate; the systems and workflows in place at the company, as well as the shared values common throughout the company; and the style leaders use to motivate their teams. According to this model, the seven factors — divided into “hard” elements (strategy, structure, systems) that influence management, and “soft” elements (staff, skills, shared values, style) — have to be aligned in order to achieve successful transformation. This model was developed in the 1980s to aid organizations that were undergoing restructuring, and it emphasized not only the technological considerations for transformation but also social and cultural aspects.
• The Prosci ADKAR Model: This is a goal-oriented model for organizational transformation that emphasizes awareness, desire, knowledge, ability, and reinforcement. These five components help organizations stay focused on the human requirements for change. They also ensure that individuals in the organization understand the need for transformation, as well as have the desire to take part in it, the knowledge and ability to implement it, and sufficient motivation to continue it. The emphasis on individual knowledge and motivation ensures that organizational change cannot happen without employees understanding why it is happening and being on board with the specific changes. This in turn ensures that managers provide the necessary training and build the required trust to implement transformation.
• Lewin’s Change Management Model: This model involves three phases: unfreeze, change, and freeze. Unfreezing involves getting employees on board with the need for a change in processes, raising awareness and creating momentum in anticipation of change. Then the organization implements the changes, and people adapt to the new processes. Finally, refreezing involves stabilizing and reinforcing new processes, ensuring that policies and procedures are updated to reflect the changes and that the organizational culture supports them. Since transformation is ongoing, this model reflects a continuous process. For example, a company transitioning to a digital model for invoicing might first have to convince employees comfortable with a current manual system that change is necessary. Then, as the company rolls out a new digital invoicing software, it might have to provide training resources and other support systems. Finally, after adopting the new system, the company would focus on stabilizing, which might involve refining workflows, integrating the new system into daily workflows, rewarding employees who use the new system well, and conducting regular reviews.
• Kotter’s 8-Step Change Model: This model emphasizes the importance of building urgency in order to enact change and transform the organizational culture. It involves several key steps: clearly communicating the need for change, building a coalition of stakeholders to influence this change, forming a strategic vision, and clearly defining the ideal future state, then taking that vision to every level of the organization and securing broad-based support. It then involves removing barriers to enacting change with resources and training, generating short-term wins for the new system with quick-result projects, using this momentum to tackle bigger challenges, and finally embedding the new approaches into the organization’s work culture, ensuring that the company’s policies, procedures, and norms reflect the changes.

Learn more about optimizing your business processes with this beginner’s guide to business process modeling and notation .

Approaches to Business Process Transformation

Approaches to business process transformation typically revolve around three key areas: people, processes, and technology. Successful transformations require a holistic focus on these categories, as they encompass the essential elements for driving change, improving efficiency, and enhancing a company’s competitive edge.

According to Evan Weiner , who manages commercial operations at Tanium and previously led transformation efforts at Splunk, this is the mantra to business process transformation: “People, process, technology.” Holistic transformation efforts should consider all three of these broad categories, and most approaches to business process transformation share overlapping focuses and methodologies.

Technology-Driven:

• Automating complex decision-making tasks
• Analyzing large datasets to identify patterns and optimize processes
• Enhancing fraud detection and risk management
• Implementing virtual assistants for streamlined customer service
• Adopting new technologies, including AI tools, or Internet of Things (IoT) devices
• Implementing cloud-based solutions
• Integrating digital platforms across the organization
• Changing the mode of delivery, such as Netflix switching from the DVD rental model to a streaming model to keep up with consumer preferences and new technologies
• Developing new products, such as Nokia shifting from manufacturing cables to becoming a telecommunications company
• Entering new geographical markets, such as Starbucks adapting its product to regional tastes to become an international chain  

Process-Oriented:

• Lean Six Sigma: This methodology combines Lean principles (eliminating waste and improving flow) with Six Sigma (eliminating defects and reducing variability in processes) to improve process quality and efficiency. It typically requires the involvement of certified professionals who are trained in these methodologies. Lean Six Sigma involves identifying and eliminating activities and processes that do not add value and conducting statistical analysis to reduce process variation. It also involves continuous improvement through DMAIC (define, measure, analyze, improve, control) cycles. Learn more about the methodology in this complete guide to Lean Six Sigma .  
• Total Quality Management (TQM): TQM is a comprehensive, organization-wide effort focused on long-term quality improvement. While it overlaps with Lean Six Sigma, TQM aims to improve all aspects of the organization, not just specific processes. In other words, with TQM, everyone in the organization is involved in the quality improvement efforts. This participatory approach creates a culture of continuous improvement. TQM emphasizes a commitment to quality improvement across the entire organization and a reduced dependence on inspections through a customer-focused approach to quality. This requires open communication and collaboration, as well as ongoing training and education for all employees. Learn more about this quality management system in this comprehensive guide to total quality management .  
• Agile Transformation: This methodology applies Agile principles, which were originally created for software development, to business process transformation. It encourages flexibility, adaptability, and responsiveness to change. This involves breaking down larger transformation initiatives into smaller, manageable components in order to focus on continuous delivery and improvement. Learn more about the Agile methodology in this comprehensive guide to the Agile manifesto , and implement Agile project management with this complete Agile one-stop project management resource .  

People-Focused:

• Customer-Centric Transformation: This approach puts the customer at the center of process redesign efforts. It involves mapping and optimizing customer journeys, implementing Voice of Customer (VoC) programs, and generally focusing processes to enhance customer satisfaction.
• Cultural Transformation: Business process transformation can’t happen without changes to the organizational culture that show support for the new values, behaviors, and ways of working. For example, improving employee engagement to foster a more collaborative workplace is necessary for making strategic transformations that focus on participatory approaches to improvement. “I think the biggest thing when talking about transformation is the culture component,” Weiner says. “A company can implement the greatest technology in the world or put together the gold standard Harvard Business Review process, but if the organizational mindset isn’t there, and the behavior toward change and continuous improvement isn’t there, no one’s going to actually use it, and it’s not going to matter.”
• Capability-Driven Transformation: This approach focuses on building and enhancing employees’ core capabilities. This involves assessing the current capabilities, conducting gap analysis, and engaging in training to develop new skills and competencies. This enables the company to keep up with changing market demands and readies it for future growth.
• Organizational Restructuring: This strategy focuses on realigning the organizational structure with business goals. If the current hierarchy hinders innovation or communication and there is a need to break down silos to improve collaboration, organizational restructuring may be necessary. 

Phases of Business Process Transformation

The phases of business process transformation depend on the organization’s goals, the existing processes, and the scale of the changes required. Generally, they involve assessing the needs of stakeholders, generating ideas, designing new processes, creating a roadmap for execution, implementing changes, and continuously refining solutions.

Simone Grapini-Goodman , Chief Marketing, Communications, and Digital Officer at the American Diabetes Association, recommends what she calls “design thinking frameworks” to think about business process transformation. Design thinking frameworks traditionally view transformation in terms of five phases: empathize, ideate, prototype, test, and implement.

“I’ve learned over the years that a slightly altered approach makes more sense for processes,” she says. Grapini-Goodman’s “adapted approach” reframes the traditional model in four phases: discovery, definition and decision, development, and deployment. “This adjusted framework ensures a more effective and collaborative process for achieving business transformation.”

Here are the four phases Grapini-Goodman recommends:

• Discovery: Traditionally called the empathize phase , discovery involves deeply understanding the needs, challenges, and perspectives of users or stakeholders. “ Empathize is relabeled as discovery ,” Grapini-Goodman says. “This phase is crucial for understanding the current state and identifying opportunities for change.”
• Definition and Decision: This is the traditional ideation phase. According to Grapini-Goodman, the purpose of this phase is to “define what we are solving, outline what is out of scope, and plan our approach.” Grapini-Goodman argues that these first two phases are critical for engaging with stakeholders. “Stakeholders’ engagement and development are essential,” she says,— “make sure you bring people along on the journey, and communicate transparently and consistently.”
• Development: This phase combines the traditional prototype and test phases to make a clear transformation roadmap. “This involves creating a detailed plan in collaboration with stakeholders and socializing it on a smaller scale to gather key input,” Grapini-Goodman says.
• Deployment: In this phase, according to Grapini-Goodman, the transformation is executed at scale. This phase also includes monitoring. “Refinement is key when implementing and measuring transformation,” she says. “Remember that transformation is an organic process that needs to be nurtured and adjusted at times based on ongoing learning and the changing business landscape.”

Steps to Implement Business Process Transformation

The steps to implementing business process transformation are to assess the existing processes, plan resources for transformation, design new processes and workflows, implement new systems, and monitor the process. This also involves fostering a culture of adaptability among employees and ensuring that changes are always aligned with long-term business goals.

Evan Weiner’s end-to-end process for business process transformation consists of these five stages: assessment, planning, design, implementation, and monitoring.

These are the steps for implementing business process transformation:

1.  Assessment: This stage involves reviewing the current organizational design and completely rethinking the existing system to identify gaps in structures and processes. This can include business process modeling , or creating a visual and analytical representation of business processes. It also includes identifying redundant tasks or outdated systems and gathering input from stakeholders or project management teams on what’s missing. “Let’s say we have these 20 problems,” Weiner says. In the assessment phase, “let’s go in and assess what’s most important, and what’s the level of effort against it.” This stage is essential for clarifying the goal for the business process transformation.

2. Planning: This phase involves ensuring that you have enough resources to achieve your goal, and laying out your goals against a timeline, according to Weiner. “This is when I like to align on the problem statement, put together a vision and objectives, and understand the metrics that we’re going to be tracking and the reports that we need,” he says.

The planning phase can be broken down into several separate steps:

• Fill the Room: Business process transformation can’t happen without people. When undertaking transformation, make sure all stakeholders are informed of both the assessment and the plan so they know what the process will entail and what to expect. “My favorite question to ask when I’m starting a transformation effort — and people laugh because I’m asking it all the time — is, ‘Who else needs to be in the room?’” says Weiner. “The worst thing that can happen is you go through a transformation, you’re six months down the line, and you realize you never talked to Jim or Bob in finance about something that was impacting his team. The biggest thing that I’ve learned was bringing in as many people as early on in the process as possible, and making sure there’s cross-functional alignment on the problem statement and then the vision.” One way to engage all these interest groups is to hold early-stage workshops, guided by a single “narrative,” according to Weiner. “That includes key elements such as problem statements, business backgrounds, metrics and related KPIs, business impacts, and recommendations,” he says. “Start the workshop by having everyone read over this narrative to ensure alignment. This initial step is crucial as it sets the stage for more constructive and focused discussions on the recommendations. By having everyone on the same page, we can dive deeper into the issues at hand and work collaboratively toward solutions.”  
• Get Buy-In: Some people may be resistant to transformation, especially when it involves new technologies, because they are used to the status quo. Hear out their concerns, and make an effort to convince them of the urgency and the benefits of transformation, using data, research, and metrics. In the long run, as your business becomes more innovative and competitive, everyone will gain from process transformation.
• Develop Samples: Bring in leaders across different departments to create a comprehensive transformation and change management plan, keeping in mind the importance of connecting new business processes end to end. This early collaboration can facilitate the development and analysis of sample process models. Try to solicit feedback and support from employees and key stakeholders.
• Compare Samples: Compare your processes to those used by competitors or those considered best practices according to industry standards. Use this analysis to identify room for improvement in your model.
• Analyze existing processes, systems, and performance metrics.
• Consider your current organizational strategy.
• Identify pain points, inefficiencies, and areas for improvement.
• Write it all down.
• Articulate the overall purpose and desired outcomes of the transformation.
• Consider how this might align with the broader organizational strategy and objectives.
• Workshop with Multiple Stakeholders: Gather feedback from every interest group on how potential changes in the business process will affect them.  

Start planning your first steps with these free goal setting and tracking templates . Visualize processes better with this essential guide to business process mapping .

3. Design: This phase involves using new technologies to redesign core processes. Make sure you document all existing processes and requirements, including training requirements for employees. According to Weiner, the design phase is the time to discuss the future state process. “What is that going to look like? What technology is needed?” he says. “How does the future state design impact organizational design? Do we need any new roles or responsibilities? Do we need to make any changes to the overall organizational structure?” “I’m mostly involved in systems work or sales transformation,” he says. “So for me, this process involves asking, for example, ‘How do we actually design the system to be able to convert our customers from premium to cloud licenses?’ A lot of it will be systems-heavy, but we’ll do read-outs and have conversations with all of our stakeholders to make sure we’re on the right track. I like to have check-ins with everyone to say, ‘Are we doing alright? Is this the vision that you have as well?’ Because we don’t want to end up nine months down the road and realize we designed this wrong.” Designing new processes involves different components:

• Create a Workflow: Diagram your ideal scenario, including all the components of an optimal workflow. This new workflow diagram should include all tasks completed by individuals, teams, and systems.
• Make a Transition Plan: A business process transformation transition plan can detail how your business will conduct everyday operations and implement new processes simultaneously. This transition plan should include a detailed timeline of the different phases of your transformation and be shared across the organization so that all stakeholders have realistic expectations.
• Define Performance Metrics: Business process transformation requires a set of well-thought-out measurements, established at the beginning of the process, to track progress and alignment with strategic goals.
• Conduct User Acceptance Testing: For technical products especially, it’s useful to conduct internal testing before implementing a pilot or a full rollout. Business users can test the entire system and process to ensure that everything is working prior to full-scale implementation. “It’s useful having a select number of people do all that testing before we actually do the release,” Weiner says.  

Document and design your processes more effectively with these free process document templates .

4. Implementation: During this phase, change management is critical. For business process transformation to be executed successfully, it’s important to have employees experienced with change management on board who can help mitigate disruptive effects and support other employees throughout the transition. “Make sure that we have adoption, that we have the culture change, that we’re providing support and training,” Weiner recommends.

Implementation is usually best done in phases, rather than all at once. In Weiner’s case, he conducts a pilot test at the scale of about 200 users before a full rollout reaches about 7,000 users.

5. Monitoring: “We’re not done,” is the first thing Weiner reminds his teams after the implementation phase. In the immediate aftermath of implementing changes, integration can be challenging. This period requires monitoring and continuous improvement. “Now we’re running the reports that we had built earlier, making sure that we’re hitting the metrics that we had set out to achieve,” Weiner says.

The monitoring phase can be broken down into three parts:

• Tracking: At this point, teams need to start measuring KPIs and tracking progress with reporting tools and dashboards. To learn more about tracking progress, read this comprehensive guide to KPI dashboards , or check out this collection of free KPI dashboard templates .  
• Collecting Feedback: Sending notes to users to gather their individualized feedback allows you to check whether the user experience is as intended, and whether users have any suggestions for improvement. Ensure that these exchanges are detailed and well documented so that the information gleaned from them can be useful in the next step.  
• Continuous Improvement: At this point, the process is no longer internal, and the business team hands it over to the transformation team. “It’s like the right arm and the left arm,” Weiner says. “The transformation arm will do all the reporting [which includes gathering information from tracking and collecting feedback], and once it’s time to actually implement the improvement, we pass it over to the business team and they handle implementations from there.”

Business Process Transformation Starter Kit

Download the Business Process Transformation Starter Kit

Use this free starter kit during your business process transformation process. This kit includes templates for a basic elevator pitch and an elevator pitch deck.

In this kit, you’ll find:

• A  change management brainstorming template for Microsoft Word  and  Adobe PDF  to help you brainstorm the requirements and challenges of different aspects of your process transformation
• A  performance checklist for Microsoft Word  and  Adobe PDF  to help you measure the impact of your transformation
• A  business process transformation performance scorecard for Excel  and  Adobe PDF  to help monitor your transformation cycle
• A  flowchart template for PowerPoint  to help visualize the current and future business process
• A  workshop facilitation template for Microsoft Word  and  Adobe PDF  to help your team work through the initial phases of transformation

Ways to Measure Your Business Process Transformation

Key metrics to assess your business process transformation are effectiveness, alignment, speed, cost, time, revenue, efficiency, customer and employee satisfaction, error frequency, and brand perception. Compare each to the pre-transformation process to monitor the success of your business process transformation.

Continuous monitoring is essential for any business process transformation cycle. Ensure that you are regularly collecting data and feedback from consumers and employees, as well as identifying changes.

You can use several tools and metrics to measure your transformation process. Using as much stakeholder and customer feedback as possible, create a scale to measure the following elements:

• Effectiveness: How effectively is the process delivering value to customers based on their specific requirements?
• Alignment: How closely is the process aligned with customer demand profiles and time requirements?
• Speed: Track the total duration of the process, from input to delivery. How quickly is the end product reaching the customer, compared to before implementation?
• Cost: Calculate the total cost to produce and deliver outputs, including inputs, processing, and resource costs. How does it compare to the process prior to implementation?
• Time: Quantify time saved with the transformed process. How does it compare to the time prior to implementation?
• Revenue: How does revenue tied to the transformed process compare to prior to implementation?
• Efficiency: How does resource consumption of the process compare to prior to implementation?
• Customer Satisfaction: How would customers rate their experience compared to prior to implementation?
• Employee Satisfaction: How does employee engagement and experience rate compared to prior to implementation?
• Errors: Track the frequency of errors and the amount of rework needed after implementing new processes. How does it compare to prior to implementation?
• Brand Perception: Rate the change in brand value with the transformed process.

Examples of Business Process Transformation

Companies such as General Motors, Toyota, and others have undergone business process transformation to improve their efficiency, adapt to changing market conditions, expand their offerings, and more. For example, Walmart increased sales by overhauling its e-commerce strategy and buying Jet.com.

Here are some examples of companies that have implemented significant business process transformation:

• General Motors: Around 2012, GM decided to overhaul its approach to IT by hiring almost 10,000 IT professionals to replace their contractors. This provided the support needed for employees to focus on innovation and development rather than solely business-as-usual maintenance work, resulting in an exponential improvement in data and productivity. Before their transformation, the ratio of internal to external employees was about 10 to 90; after transformation, it was about 90 to 10.
• Walmart: After acquiring the e-commerce company Jet.com in 2016, Walmart spent nearly $12 billion investing in technology in what Moody’s lead retail analyst called a “ race for second ,” competing only with Amazon. Within two years, its online sales had increased by 40 percent . 
• Toyota: Integrating digital technologies such as AI and the Internet of Things (IoT) allowed Toyota to focus on data-driven insights and research , including using computer vision and machine learning for autonomous vehicles and predictive capabilities for taxi service demand.
• Goldman Sachs: In 2016, Goldman Sachs created Marcus, a digital banking platform that used data analytics to gain new insights into trends, risks, and customer behavior, and began to offer tailored banking services such as personal loans and savings accounts. Over the next three years, the platform generated more than $5 billion in loans and $55 billion in deposits across the United States and the United Kingdom.

Business Process Transformation Case Study

Business process transformation is happening all the time in a myriad of different ways. In the case of Splunk, a software company where Evan Weiner led the transformation effort for three years, one major transformation was transitioning customers from on-premises licenses to cloud-based licenses. This is a common move across the industry.

“We implemented a transformation called ‘cancel and replace,’ which was to cancel all of our customers’ existing licenses that were on premises — on actual hardware — and replace them with cloud-based licenses,” Weiner says. To tackle this, he used his three-pronged approach: people, process, technology.

First, the team at Splunk had to think about the current and future processes. “What is the process that we do as a sales team right now to sell on-premises licenses? What is the future state process going to look like, to be able to actually go in and change those existing licenses and replace them with cloud licenses?” Weiner asks.

This also involves thinking about the different roles and responsibilities that will be affected by the transformation. “Fulfillment teams, invoicing and finance teams, and sales teams — what is changing for those people to now be able to sell in the cloud?” Weiner says.

Then they had to make sure that they had the right technology and infrastructure to implement this transformation. “We have to ask: Do we have the right systems in place? Do we have the right tools in Salesforce, for example, to be able to support being able to convert those licenses into cloud?” Weiner says.

Finally, they had to consider how the organizational culture would be impacted and how it would need to change or be supported. “It’s an organizational mindset,” Weiner says. “How do we actually enable the behavioral change required to get people to now do a cloud-based sale? Everyone’s job description has essentially changed.”

To learn more about implementing practical transformation solutions, check out this real-world guide to business process management .

Challenges in Business Process Transformation

Not all businesses are ready for business process transformation all the time. Not having a clear vision or plan for integrating new technologies can lead to failed change efforts. Lack of employee buy-in is another common challenge companies may face.

In 2015, McKinsey observed that 70 percent of change efforts failed, “largely due to employee resistance and lack of management support.”

Here are some common challenges that a business might face when undergoing or considering business process transformation:

• Ambiguity: “Lack of a clear vision — or inadequate communication of that vision — is perhaps the first opportunity to get it wrong,” says Grapini-Goodman. It’s possible to invest in a transformation that digitizes a process without necessarily making it more efficient or effective, if the overall objective is not clear enough.
• Inertia: People may be justifiably skeptical or scared of large-scale organizational change. To address this, full transparency about the transformation initiative is essential. “It’s important to understand the different motivations of various stakeholders, anticipate what their response might be, and build a plan to address it,” Grapini-Goodman says.
• Integration Challenges: Aligning new technologies, processes, and organizational structures, whether with new management methods or new data systems or software, can be expensive and require significant resources. Choosing the right business process management platform and conducting thorough testing is essential. If existing systems are not well-integrated into new systems, data can end up inaccurate and cause disruption or delay to the overall process.
• Measurement: “Measuring the impact of transformation can be challenging at times since it is not the only thing that may be changing,” Grapini-Goodman says. “Nothing is constant. There might be competitors or regulatory or consumer actions that also influence the course of the business. While measurement might not be perfect, it should not be ignored. Progress over perfection will be key in understanding impact.”

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Coupling the system with the approach helps in the generation of new leads and traffic to your website, with a great boost to brand awareness and recognition.

Here is where TikTok growth strategy comes in, designed to get you the highest value from your every dollar invested in social media campaigns.

As TikTok's growth persists, and with a market space that is ever more crowded, a strong growth strategy is essential in order to win the largest addressable audience possible and engage it effectively.

20 Best TikTok Growth Strategies to Grow Your Brand on TikTok

Now, the part you’ve been waiting for.

• Optimize your profile: Crafting a strong brand profile on TikTok is a powerful tool for attracting user attention and setting the foundation for your social media marketing efforts.
• Understand your audience: To resonate with your audience, dive into the TikTok-style video content that aligns with their preferences, leveraging TikTok's preferred search engine features to uncover trending searches. Use dance challenges, special effects, and creator tools.
• Use TikTok influencer marketing: Engaging with popular creators through an influencer marketing platform can amplify your branded content, making your company one of the favourite brands on TikTok.
• Leverage paid media to scale your influencer marketing campaign: Combining organic content with Spark Ads in your campaigns alongside content takes your strategy from solid to stellar, ensuring a wider reach.
• Use TikTok UGC: Encouraging your audience to create content from scratch fosters a community of creators, making every piece of content a potential viral contest entry. Alternatively, use popular creators with a significant follower count to post several times per day.
• Focus on a niche: Specializing in niche TikTok marketing helps you jump ahead of the curve before competitor brands, establishing your authority in specific content pillars.
• Use TikTok Pro Analytics: TikTok Pro Analytics is an essential organic marketing tool for understanding the types of videos that engage your audience, optimizing your content creation process.
• Leverage TikTok trends: Staying atop organic trends and participating in viral challenges like the song challenge can catapult your content into the limelight.
• Focus on creating engagement: Crafting epic content that leverages awesome features like branded stickers encourages user interaction, making your brand more memorable.
• Post frequently: Maintaining a consistent post frequency, with 2 - 3 posts per day, keeps your audience engaged and ensures a steady organic growth curve.
• Use hashtags: Implementing a branded hashtag challenge not only boosts your visibility but also engages users in a community-building initial challenge.
• Use the right sound and music: Aligning your content with trending sounds enhances its potential for virality, making your videos part of the larger TikTok conversation.
• Make a duet with an influencer or loyal follower: Duets are a unique advertising format on TikTok, offering a creative way to collaborate with influencers and engage your community.
• Post at the right time: Analyzing when your audience is most active using TikTok Pro Analytics can optimize your times per day to post, maximizing user attention.
• Leverage cross-promotion on other marketing channels: Cross-promotion amplifies the reach of your TikTok marketing, driving traffic from other social media channels to your TikTok content series.
• Use branded TikTok ads: TikTok ads, especially when featuring helpful content like how-to and tip-based content, can significantly lower your app install CPA while driving brand awareness.
• Use CTAs: Effective CTAs in your videos act as a solid strategy, guiding viewers towards taking the next step in their journey with your brand.
• Make a solid plan to go viral on TikTok: A solid plan for viral success involves leveraging key terms in your content and engaging with organic trends to capture the TikTok audience's imagination.
• Monetize your music on TikTok: For artists, TikTok offers a unique platform for music promotion, with features that allow for the monetization of mobile video content, expanding reach and engagement.
• Leverage TikTok SEO: Implementing TikTok SEO tactics ensures your content is discoverable, driving organic growth and increasing visibility across the platform.

1. Optimize Your Profile

Before thinking of intricate marketing initiatives, remember that your username can make or break your success on this social media platform, so make sure it’s:

• Easy to memorize
• Easy to pronounce

And yes, it can even contain your real name — especially if you already have a brand.

Apart from that memorable TikTok username, you also need:

• A profile picture that draws attention while being easy to recognize
• Links to all of your social platforms
• A public profile

Take Grammarly, for example:

The company uses its famous logo as the profile picture and its brand as the profile name.

They also have a clear slogan, “Good writing moves work forward,” so people (and TikTok’s crawlers) can immediately understand the services offered.

More importantly, Grammarly has recently created playlists for its content so people can find what they’re interested in faster.

Additionally, for those interested in the evolution of social media branding, the TikTok Logo Design History offers fascinating insights into how the platform's iconic logo came to be.

2. Understand Your Target Audience

You can’t grow your company on TikTok unless you understand your audience precisely.

After all, if you’re not speaking their language, how can you expect to draw their attention?

Here’s what you have to consider:

• Be highly specific: Select a niche that will pick up on your TikTok videos and make them go viral.
• Understand your audience: Know what they like and don’t like by researching different profiles within your target demographics (e.g., geographical area, age, etc.). Alternatively, you can just ask your existing audience for their feedback on other social platforms.
• Understand your competition: It’s wise to check what your competitors are doing because you can backtrack their success strategies or find missed opportunities you can leverage. For example, they may produce instructional content in volume or use Spark Ads.

3. Use TikTok Influencer Marketing

Most people associate TikTok with a teen demographic, but that’s not entirely true.

According to Comscore , the 20-39 generation represents 46% of the social network's user base, while teens represent 32.5%.

That means TikTok has hundreds of millions of users with significant purchasing power.

Another advantage is that those people make purchase decisions according to influencers’ recommendations.

There’s another thing to consider:

Those younger generations will soon grow up to have significant purchasing power, too.

According to Forbes , this generation will shortly amount to 40% of all consumers.

And Gen Z hates traditional advertising.

Warning: The worst mistake your company can make on TikTok is posting ads that look traditional, like they came out of a print ad or a TV advert.

That’s why influencer marketing an effective strategy for TikTok.

Content creators on this platform:

• Are outstanding at storytelling
• Keep your brand messages authentic
• Have a loyal base of followers
• Give you access to a broader audience, ensuring follower growth

4. Leverage Paid Media to Scale Your TikTok Influencer Efforts

That’s probably the most important question because you’re not advertising on TikTok for the sake of advertising.

You want to increase your gains and expand your company.

Here’s how we advise our clients to implement this step.

First, ask yourself what types of content work well on TikTok.

Your best performance indicator is shareability.

The TikTok videos that people — your people — share the most are the ones they resonate with. These clips can be:

• Original music
• Dance videos
• Comedic skits
• How-tos ( how to do voice overs )
• Tips and demonstrations
• Cringe clips

Below is a rundown of TikTok content that brought awesome results for various clients we had across a slew of diverse audiences.

You can use these ads in combination with your influencer campaigns:

• In-feed ads are short-form video ads that fit into TikTok’s format. You can adapt these ads to your target based on primary demographic factors like age, location, and gender. These ads cost $10/impression, so you need about $6,000 to start your campaign.
• Brand takeover ads. These ads are the most actionable and get users to your landing pages directly, but they’re also the most expensive. Prepare a $50,000 budget/day.
• Challenge ads. These ads work like regular challenges on TikTok, with one difference: they promote your branded hashtags. As a result, you’ll raise awareness and receive tons of user-generated content that you can repurpose. Don’t forget to send users to a page with precise instructions for a successful UGC strategy on TikTok .
• Shoppable ads. These ads give your challenges a shoppable dimension because people can click on the Explore tab after visiting your hashtag-challenge page. This tab has a “Shop Now” feature that sends people to your website’s landing page.

Influencer marketing ads should take center stage in your campaign, though.

Influencer ads generate:

• A high level of engagement: Measured particularly in the quality of the comments you receive and the number of shares. Likes and views take second place.
• Positive brand sentiment: Measured by the number and quality of brand mentions and the user-generated content that becomes viral.
• Conversions: Measured in the number of sales, sign-ups to your newsletter, or downloads.

Pro tip: If you want to achieve these results, make sure the video content created and distributed by your influencer is:

• Inspirational

Case Study Break: Unroll.me

inBeat Agency leveraged TikTok Ads to significantly boost the promotion of the Unroll.me app for NielsenIQ, focusing on a creative strategy centered around user-generated content.

By tapping into our micro-influencers and content creators network, inBeat produced authentic and high-quality visual assets tailored for TikTok's dynamic platform.

Not to brag, but this approach was underpinned by a meticulous media-buying strategy, which involved defining the app's unique selling propositions, identifying target personas, and generating content that resonated with these elements.

The process also included continuous analysis, testing, and optimization of the creatives, coupled with collaborative brainstorming sessions with top creators to keep the content fresh and engaging.

The results of this strategic approach were outstanding.

The campaign achieved over 100,000 app installs per month, demonstrating the effectiveness of leveraging TikTok Ads with a focus on genuine UGC.

Most notably, there was a remarkable 75% reduction in the cost per acquisition across all major paid media platforms used in the campaign and an 83% CPA decrease on TikTok.

5. Use TikTok UGC

Building a content library with user-generated content on TikTok is an excellent growth strategy.

The first step entails engaging customers and creating a community where they can share product experiences and participate in challenges, fostering a sense of belonging and validation.

Remember: Collaborate with influencers who resonate with your target audience and have a high engagement rate.

Authenticity and relatability in content significantly enhance trust and social proof, potentially leading to FOMO and increased desire for your products.

Encouraging content that aligns with your audience's interests without being overly promotional creates a more organic and effective marketing approach.

Insider tip: We advise our clients who want to create successful UGC campaigns to carefully select influencers who reflect their audience's demographics and interests, personalize pitches to potential collaborators, and clearly define content goals and expectations.

Besides, focus on evaluating content effectiveness.

This should go beyond superficial engagement metrics to include conversion rates, ensuring that the UGC not only garners attention but also drives sales.

You should also repurpose your TikTok UGC to grow your brand on other channels.

Incorporating influencer content into your broader marketing strategy, such as social media, email marketing, and your website, requires a thoughtful content calendar and a strategic approach to repurposing TikTok videos.

Using tools like inBeat can streamline the process, saving time and enhancing the efficiency of your UGC marketing efforts, ultimately keeping your brand relevant and encouraging purchases.

Case Study Break: Hopper

inBeat Agency tackled the challenge of ad fatigue on TikTok for the travel app Hopper by strategically scaling UGC for their ads.

Ad fatigue which typically leads to increased CPAs. The solution involved establishing a scalable content creation process that enabled Hopper to collaborate with top-performing creators on the platform.

This approach ensured a continuous supply of authentic and engaging creatives that resonated well with the TikTok audience.

By leveraging UGC, Hopper maintained fresh and relatable ad content, effectively driving down CPAs and circumventing ad fatigue.

The result was a stream of ongoing, high-performing creatives that contributed significantly to Hopper's advertising success on TikTok.

6. Focus on a Niche

Focusing on a niche is a pivotal TikTok growth strategy that involves tailoring content to cater to a specific audience segment with particular interests or needs.

This approach helps content creators or brands establish themselves as authorities or go-to sources in a specific domain, leading to a more engaged and loyal follower base.

Content consistently themed around a niche resonates more deeply with viewers who share an interest in that topic.

This resonance increases the likelihood of content being shared, commented on, and liked, which are key factors in TikTok's algorithm for promoting content to a wider audience.

Insider tip: At inBeat, we found that niche-focused content faces less competition than broader categories, making it easier to stand out and get noticed.

Besides, focusing on a niche makes brainstorming and producing content easier, as you become deeply familiar with the subject matter and your audience’s preferences.

This familiarity breeds creativity and authenticity, critical for maintaining viewer interest and engagement over time.

7. Use TikTok Pro Analytics

Using TikTok Pro Analytics is a strategic move for anyone looking to grow on the platform because it offers invaluable insights into your account's performance.

With this tool, you can dive deep into your content's reach, engagement rates, and viewer demographics, enabling you to understand what works and what doesn't.

This data-driven approach entails optimizing your content strategy by tailoring your videos to your audience's preferences, posting at optimal times, and more effectively leveraging trending topics.

Thus, TikTok Pro’s excellent insights into the minds of your consumers allow you to adjust your video content strategy according to your marketing goals.

Pro tip: To simplify the process of tracking your campaign, you can use an online tool, such as the influencer tracking software .

Case Study Break: NYC Votes

For the NYC Votes campaign, inBeat Agency harnessed the power of TikTok analytics to craft a targeted campaign to engage young voters, a demographic increasingly difficult to reach via traditional marketing channels.

Recognizing this group's diverse interests and backgrounds, inBeat strategically collaborated with various influencers, each bringing their unique perspective to discuss the importance of voting in formats that naturally resonated with TikTok users.

The usage of TikTok analytics was crucial in this process.

By analyzing data on user engagement, content preferences, and viewing habits, inBeat could identify content themes and influencers that would most effectively capture the attention of young voters on the platform.

This data-driven approach ensured the content was relevant, engaging, and optimized for maximum reach and impact within the TikTok ecosystem.

Results: The average view time for the content was an engaging 10 seconds, indicating that the messages were captivating enough to hold viewers' attention.

Overall, the campaign amassed a remarkable 2.5 million views, with 56% of users watching more than half of the content.

8. Leverage TikTok Trends

Leveraging TikTok trends is a solid growth strategy for brands because it taps into the current cultural zeitgeist, ensuring content resonates with a broad audience.

Trends on TikTok typically go viral, offering a unique opportunity to increase your visibility and engagement quickly.

By participating in these trends, you can showcase your adaptability and relevance, connecting with users in a fun and relatable way.

This enhances brand recognition and fosters a sense of community and belonging among viewers.

Consequently, using TikTok trends can significantly amplify your brand's reach and appeal on the platform.

inBeat creators frequently use trends to relate to their audience.

Here’s a neat example from the NYC Votes campaign above, leveraging the “joke is on you” music trend:

Pro tip: Find a trend that:

• Suits your values and personality
• Fits your brand
• Lets you show your uniqueness

9. Focus on Creating Engagement

Creating engagement on TikTok guarantees that people who’ve accidentally discovered your videos will come back for more, which helps grow your brand.

Also, they’ll share those viral videos or even use them as a starting point to create their own content.

You can create engagement by:

• Using a theme that’s easy to recognize
• Linking “episodes” to keep your audience coming back
• Responding to comments on your profile
• Engaging with other content creators on their profiles

One of inBeat’s clients, Linktree, offers a neat example again by partnering with highly engaging influencers:

@linktr.ee it's about time @Tiara Willis ♬ original sound - Linktree

10. Post Frequently

More posts attract a larger audience, so posting frequently embodies the very definition of a solid growth strategy.

The problem is you can easily slack off posting regularly.

The solution is planning a rigorous schedule.

Thus, take the time one day per week to shoot and edit a set of TikTok videos.

Then, post these videos for the rest of the week to keep your audience coming back for more.

• Don’t get discouraged if your first few videos don’t get a lot of views. Keep at it diligently, and your time to shine will come.
• Don’t delete old content. One of your old videos can hit the FYP page and go viral anytime. That’s TikTok’s algorithm for you—the more outstanding content you post, the more chances your old videos have of getting viral.
• Use exciting video titles to catch people’s attention. However, remember that your content should be quality. Intriguing titles paired with poor content can dispel your audience quickly.

11. Use Hashtags

Using suitable hashtags will get you TikTok famous because people usually try to watch everything related to a specific topic they like.

And that will help you grow your TikTok audience.

• Check out the trending hashtags using the suggestion tool. All you have to do is click #, and you’ll get many suggestions.
• Start with hashtags that fit your niche and values.
• Include relevant hashtags on your video captions to attract more potential followers and to show TikTok’s algorithm what you’re about.
• Use branded hashtags to reflect your audience’s subculture and build your audience.

12. Use The Right Sound and Music

If you’re a musician, use your original tunes on TikTok.

Needless to say, you should select the best 15 seconds from your best soundtracks if you’re going down this road.

If you want to use your music in videos without soundtracks, download some royalty-free stock tracks from websites like Videvo and experiment with blending them together!

Otherwise, consider using trending songs or even hiring an in-house musician.

Hint: It’s not a coincidence that many popular songs are also popular on TikTok.

This platform is in cahoots with the music industry, and many record labels push specific songs on TikTok.

So all you have to do is jump on a famous song wagon to grow your brand on TikTok.

Here’s how to find a tune that works:

• Open TikTok video editor
• Tap on the plus icon
• Select “sounds”
• Check out what’s now famous on TikTok

Pro tip: If you want to be super-specific and choose a popular song with your audience, get TikTok Pro .

This account type has an Analytics tab in your Followers section that tells you what your potential customers listen to.

13. Make a Duet with an Influencer or Loyal Follower

Making a duet with another TikToker — maybe a famous one or one of your most talented audience members — helps you leverage their engaged audience to grow your visibility on TikTok.

This strategy:

• Increases your organic visibility
• Shows off your skills/values
• Brings more interaction between you and your audience
• Increases brand engagement

14. Post at the Right Time

If you want to draw more people to your TikTok profile, post when your audience is online.

Timing is essential because it increases your visibility.

If you have that TikTok Pro Account we mentioned earlier, the Analytics section will help you find:

• Where your audience is from
• When your potential customers/viewers are on TikTok (days and peak times of day)

Although this data is only for the past four weeks, you can still gain a lot of insight into your audience’s patterns.

Pro tip: This Analytics tab will also show you your posts’ performance for the last week. That info allows you to adjust your strategy to get better results.

15. Leverage Cross-Promotion on Other Marketing Channels

Using other platforms is essential because:

• Most TikTok-ers are Gen Z
• Research shows that 71% of Gen-Z-ers are on Instagram, and 65% are on Snapchat

And, regardless of who your audience is, chances that they’re only using TikTok are very slim.

Targeting these potential customers on all the social platforms they’re using:

• Enhances your visibility
• Keeps you top of mind
• Allows you to engage with your audience in unique ways
• Increases your chances of making a sale

Here’s how to go about cross-promotion:

• Use Instagram Reels, aka Instagram’s version of TikTok.
• Remove the TikTok watermark from that video, or else Instagram won’t promote it to your Instagram followers.
• Use the Instagram Reels Explore Tab to access a new audience.
• Post your snippets on other social media channels and all of your websites.
• If you’re doing e-mail marketing, you can include these videos and a suitable CTA in your e-mails.
• Leverage IG Reels editing apps to make more engaging videos for your post.

16. Use Branded TikTok Ads

Using TikTok ads is a great growth strategy for brands due to the platform's vast, diverse user base and highly engaging content format.

TikTok's sophisticated algorithm ensures ads reach highly targeted audiences, increasing the likelihood of engagement and conversion.

In fact, setting up TikTok Ads gives you access to a worldwide audience and useful ad management tools.

These tools allow you to:

• Select a specific target
• See the people who already know you and have interacted with you
• Create professional ads
• Get detailed reports

With various ad formats available, you can creatively showcase your products or services, making your message more appealing and memorable.

Additionally, TikTok's interactive features, such as hashtags and challenges, can amplify your ad campaigns, encouraging user participation and viral sharing.

This makes TikTok ads an effective tool for boosting brand visibility, driving traffic, and achieving substantial growth.

Warning: These TikTok ad options range from $25k to $50k per day.

17. Use CTAs

Incorporating clear calls-to-action in your TikTok content is a powerful growth strategy for your brand.

CTAs guide your audience on what steps to take next, whether visiting your website, following your account or checking out a new product.

This direct approach can significantly enhance user engagement and conversion rates.

Using CTAs effectively turns passive viewers into active participants, encouraging them to interact with your brand beyond just watching a video.

This boosts your TikTok presence and drives tangible results, such as increased website traffic, higher follower counts, and more sales, contributing to your overall brand growth.

So, end your videos with mobilizing and inspiring CTAs that will nudge your TikTok viewers in the right direction.

Also, include that CTA in your video’s caption to ask people to:

• Tag their friends
• Share your videos
• Re-create your challenge
• Take part in your contests/giveaways

18. Make a Solid Plan to Go Viral on TikTok

To make TikTok videos go viral, you must navigate a series of strategic steps, understanding that there's no guaranteed formula for virality.

As always, we advise our clients to begin with a deep understanding of TikTok's dynamics, including spending time on the platform to analyze popular content and recognize patterns contributing to their success.

Pro tip: TikTok suggests that the optimal length for in-feed ads is 9-15 seconds, urging creators to distill their music into captivating snippets that encourage repetitive listening.

We also found that choosing the right digital distributor is crucial, especially one that collaborates with TikTok, to ensure your music gets the platform exposure it deserves.

Besides, creating an easy, entertaining, and replicable challenge can significantly boost engagement, aided by a catchy hashtag that links your track to the challenge forever.

Pro tip: Localizing content to reflect regional humor or landmarks can also endear you to a local audience, serving as a springboard for broader recognition.

Of course, understanding your audience is vital to tailor content that resonates with their interests and values, and selecting influencers who align with your audience can amplify your reach.

Pro-tip for musicians looking to go viral on TikTok:

Your TikTok strategy should ultimately funnel your audience to platforms where your music is sold, like Spotify or Instagram, building a community that not only engages with your TikTok content but also supports your broader artistic endeavors.

Incorporating elements that encourage user interaction, such as dance routines or TikTok's collaboration tools like Duets and Challenges, can foster community participation.

Case Study Break: Amazon Prime

Amazon Prime creates engaging content that’s easy to meme-fy and stitch.

Here’s a neat example:

@mckenzibrooke #stitch with @amazonprimevideo I think he scared my dog... LMAO 😱😅 #primevideo #withoutremorse #ad ♬ original sound - McKenzi Brooke

Amazon Prime’s initial clip sparks curiosity about the unfolding events, prompting users to use the Stitch feature to continue the scene creatively through their own interpretations and performances.

19. Monetize Your Music on TikTok

According to Business Insider , you can make money from music on TikTok because most TikTokers search the songs they originally heard on this platform.

That’s why many marketers thought to leverage this tendency by:

• Hiring influencers to promote songs
• Signing song promo deals that earn users four-figure sums/video
• Creating user-generated promo trends

Warning: You can apply some rules, but you can’t predict with 100% accuracy which video will become the next big thing on TikTok.

So, if you want to sell your music using this platform, you need to:

• Hire the right influencers. inBeat can help you with that, thanks to our experience in the field. You can join arrange a free online meeting to discuss your strategy or even try out the influencer database at no cost to see if it’d make a good fit for your needs.
• Leave plenty of room for experimentation. If you plan on hiring influencers, it’s best to give them more freedom to play with your content than on any other platform. Influencers are very creative people and have many insights into their niche, essential for turning specific content viral.
• Use the platform early on. Incorporate TikTok straight from the first steps of your creative process. Take the example of Tiagz , the Canadian rapper with a staggering 4.2 million audience. His songs are so successful because they include references to TikTok’s most popular trends and memes.

Pro tip: If you decide to use influencers to sell your music on TikTok, choose micro or nano-influencers .

The platform has already become over-saturated, so it’s better not to throw the big bucks at a premium celebrity.

Instead, working with many micro-influencers will help you cast a wider net to reach millions of views at a minimal cost.

20. Leverage TikTok SEO

Using SEO to boost your TikTok content is essential for visibility and discoverability.

For example, incorporating relevant keywords into your captions, hashtags, and video descriptions makes it easier for users interested in those topics to find your content.

This targeted approach helps you attract an audience genuinely interested in your brand or niche, enhancing engagement and fostering a loyal community.

Besides, strategically using keywords means you're effectively speaking the language of your desired audience, ensuring your content resonates and stands out amid the vast sea of TikTok videos.

Here’s how we advise our clients to use keywords effectively on TikTok:

• Start by researching trending terms within your niche and the interests of your target audience.
• Incorporate these keywords naturally into your video captions, descriptions, and hashtags, ensuring they align with your videos' content.
• Use a mix of broad and niche-specific keywords to cast a wide net while also targeting specific segments.
• Monitor the performance of your content to identify which keywords drive the most engagement and refine your strategy accordingly.

Remember: The goal is to integrate these keywords seamlessly so your content remains relatable and engaging while being easily discoverable by those most likely to appreciate it.

To promote the Greenpark app, inBeat’s influencers used certain keywords, such as “sports fans,” “sports bar on your phone,” and “Greenpark sports app.”

Kickstart Your TikTok Growth Strategy

Embarking on your TikTok growth journey can be both exciting and daunting.

Equipped with those insights and strategies — ranging from our in-house case studies to expert tips — never have you been better prepared to dive into this vibrant platform.

The base of any successful TikTok campaign is authenticity and being creative in respect of your approach, keeping the knowledge of your audience well in mind.

If you want to clear a path toward TikTok success, look no further than our TikTok influencer database — inBeat.

Offering a wide range of services aimed at pairing you with the perfect voices to put your brand in front of millions, inBeat is the ultimate influencer discovery platform.

If you are looking for one place where you can get a holistic growth strategy, then our TikTok marketing agency is your go-to partner, helping you from A-Z in making a TikTok presence that will resonate, engage, and convert.

Let's turn your TikTok aspirations into tangible results together.

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• Free Resources

Strategic Foundations of Niche Launch Success: B2C marketing examples with results

Action Box: Find your niche business opportunity Just click on this shared chat to get help from the Competitor Analyzer app in MeclabsAI (MarketingSherpa’s parent organization). It’s free to get started and discover unseen opportunities, you don’t even have to register to begin.

Quick Case Study #1: How niche site was built from the ground up post-HCU with a detailed strategy, earned $1,500/month

Observation Hobbies is a niche website focused on astronomy, geology, and meteorology. And that niche isn’t random. Its founder was specifically looking for a niche that is narrow enough to target a specific audience, but that’s broad enough that he could create segments within that audience – and that he could quickly compete in.

“Competitive analysis is fairly easy, but it does require an SEO tool. I recommend either Ahrefs or Semrush for this – although they are both expensive, the data they provide is well worth it,” said James Oliver, Founder, Oliver.com (owner of Observation Hobbies ).

Could your next niche site benefit from AI-driven content and a targeted product strategy? I asked Oliver about what worked best, and what he’d do differently if he were to launch a similar project today.

WHAT DIDN’T WORK: Overdoing internal linking, playing around with site structure too much

Oliver over-invested in manually coding silos and linking 500+ posts, a time-consuming task that a basic, automated process could have streamlined.

This was so time consuming that even with a cheap VA (virtual assistant) it cost him $150 since it took them a week of working full time to do this. Looking back, a more basic and automated internal linking process, which could have taken someone half a day instead of a week, would have sufficed. And it would have saved him $125.

He also learned a crucial lesson about the sensitivity of site structure. When he made slight changes to the silos, it resulted in a decrease in his traffic.

Creative Sample #1: Traffic decline after restructuring silos

This caused a monthly earning dip of $492.16, and he is having to put in a considerable amount of work in to get the traffic back to June levels.

WHAT WORKED: Launching a site around a product, AI product reviews and roundups

He felt that Google’s Helpful Content Update (their September 2023 update, also known as HCU) which supposedly ‘killed niche sites.’ But Oliver still saw an opportunity. To him, HCU seemed to specifically target sites that have a small backlink profile (i.e. aren’t an established brand) and are purely monetizing their content as opposed to using their content to monetize a product/service.

So he focused on building a niche site focused on a product.

According to Oliver, creating a product quickly boosts authority in Google's eyes. “Google wants to show websites run by experts – how often do we hear about the importance of E-EAT (expertise experience authoritativeness trustworthiness) and Google currently seems to think that the ability to create a product or a service based around your niche is a sign of expertise.”

You need expertise and capital to create a product. So Google, seeing that you are promoting your own product rather than just creating content for advertising space, should increase your perceived E-EAT even if you have a poor link profile, he surmised. He thinks this is a big reason why he was able to outrank sites with much better link profiles so quickly.

Rather than selling the product he gave it away as a lead magnet. This allowed him to build an email list of 12,000 people. “For Observation Hobbies, I saw on Reddit that there was a lack of online maps for rock hunters to find obscure rocks, so I created my own rockhounding map which I keep updated and use as a free lead magnet (distributed via Gumroad) to get people on my email list,” Oliver said.

AI content strategy

This was the first website where he heavily relied on AI content writing tools to create product reviews and write content.

He conducted keyword research to find commercial and non-commercial keywords. He  filtered using words like ‘best’ and ‘review’ for commercial keywords and question words (‘who,’ ‘what,’ ‘where,’ etc) for non-commercial keywords. For example, when he filtered questions with the modifier ‘how’ he noticed a lot of questions following the structure ‘how much is {rock or gem} worth.’

“This then allowed me to get ChatGPT to give me as long a list as possible of gems so I could check this keyword pattern with every possible gem along with its search volume and competition,” Oliver said. “For the commercial articles I used Koala Writer. Koala allowed me to create 348 articles in three weeks for $90. For the non-commercial articles I used Cuppa.sh. This allowed me to create 214 articles in the same three weeks for $358.44.”

Even with the cheapest possible writer, Oliver estimated this would have cost him around $10,000.

“They both have good YouTube resources on how to use them,” Oliver said. But he did provide this piece of advice, “Always use GPT-4 turbo – this allows you to use far more custom prompts so your content will stand out from other AI content (if you’re in a small niche like this you are going to be competing against a lot of AI sites).”

“I was not sure if they would convert,” Oliver admitted. “But as you can see from my Amazon affiliate earnings, they haven't done too badly.” The June spike was due to the buildup after the launch of effective product reviews. The July dip was caused by the site restructure mistake.

Creative Sample #2: Amazon affiliate earnings growth chart

“I like to track my websites rankings using a combination of Google Search Console and SERProbot,” Oliver said. If an article ranks in the top seven or better on the search engine results page, he invests manual time to further improve it.

That isn’t to say he didn’t do any manual work for the artificial intelligence articles before he published them. He edited the content to redo the intros, separate any large blocks of text, and improve the CTA boxes.

Creative Sample #3: CTA box example in telescope review

RESULTS: Earnings growth

Let have a look at the site’s earnings:

• Month 1: $0
• Month 2: $0
• Month 3: $0
• Month 4: $40.65
• Month 5: $237.50
• Month 6: $698.07
• Month 7: $1,448.35
• Month 8: $956.22

“These earnings are roughly 40% from Amazon affiliates and 60% from Mediavine display advertising,” Oliver shared.

The website currently has 578 pages and no links beyond citations (its Domain Rating is 2). Its highest traffic day in terms of traffic was 1,824, which occurred on July 2, 2024.

The upfront cost of the project was $456.12, with an ongoing monthly operating cost of $42.50. He estimates that if the site can hold its value for six months he will be able to sell it for around $50,000.

Oliver sees making his own products as an opportunity for further monetization. He is using the free rockhounding map to see if there is demand for digital products in this space. Early results look promising, so he might create maps for stargazing, or maps that go into more specific details on the most popular rockhounding locations. He may sell these on Gumroad in the future rather than only  using them as free lead magnets.

Quick Case Study #2: How a new woman-focused fashion brand scaled in its first 40 days to exceed a ROAS of 1

Tigers Eye is a UK-based, female-founded sports bra brand. When its founder couldn’t find a comfortable yet functional bra for herself, she decided to make her own. “The University of Portsmouth’s Research Group in Breast Health played a crucial role in the development of Tigers Eye bra by providing expert insights into the biomechanics of breast movement during physical activity,” said Rebeka Polgar, Founder, Tigers Eye .

After three years of development, she was ready to launch the product. That’s where our marketing story begins.

BEFORE: Broad targeting in the first 20 days of the campaign

The campaign started in the UK, US, and German markets with broad targeting: 25- to 55-year-olds with training-related interest categories. At the beginning of a product launch, without proper historical data, the team worried narrow targeting could hurt the brand’s ability to find the right audience segments because it builds only on hypotheses and not gathered data.

Ad messaging focused on ‘reinventing sports bras,’ ‘dominate the toughest workouts’ and ‘proper breast support.’

Creative Sample #4: Initial sports bra ads on Meta

The team sent ad traffic to the homepage, which had a split screen design with two headlines – ‘Intense Activity’ and ‘Military and First Responders.’

Creative Sample #5: Original homepage

Not surprisingly, the soft and hard KPIs were not good at all, but at this stage, it was not a requirement. CTRs were below 0.5%, and the team had hardly any sales. Despite these poor numbers, the cost of clicks was relatively cheap (€0.1 - 1.5) because the CPM (cost per 1,000 impressions) was lower than we expected.

The website had a popup offering 10% off their first purchase and the team created an email welcome flow.

The welcome email flow had a 4.5% conversion rate and every email had an open rate of more than 60%. However, while the first email had a 24% CTR (clickthrough rate), the second one had only 3.4%. “From our experience with other brands, even the fifth email can convert those who subscribed. For this, we use Klaviyo as our email marketing tool,” said Zsolt Farkas, Owner, Evolut Agency (Tigers Eye’s agency).

When the team looked into the reason for the decreased conversion rate in the second email, they realized that the second email had too much text, and the call-to-action was placed too far down.

Creative Sample #6: First and second email in welcome email flow

AFTER: Refined targeting and messaging in the next 20 days of the campaign

After generating 1 million impressions and reaching 500,000 users, the team conducted an in-depth analysis of the data, reviewing hundreds of session recordings. “We compared metrics from the Meta Ads dashboard, Google Analytics, and Clarity heatmap session recordings,” Farkas said.

After reviewing screen recordings, the team realized that many users didn’t know where to click on the homepage and would leave the site without seeing the products or the shop section. So, the team used dedicated landing pages for the ads instead.

In the UK, the training-focused creatives received higher engagement. As a result, they decided to stop promoting the military line there and focus solely on the high-intensity training USPs (unique selling propositions). The team organized a photoshoot specifically to show lifestyle creative of women who train hard. For example, the below carousel lifestyle creative achieved an 18% CTR on Meta. As a result, the CPC (cost per click) was only €0.03 in the UK.

Creative Sample #7: Best-performing ad creative in the UK

In the US, military women were clicking through 10 times more than any other audience. So the team focused solely on this well-defined audience of 60,000 to 80,000. They used lifestyle images and incorporated jargon that only military personnel would understand, such as ‘PT’ (Physical Training). It resulted in a CTR between 6% and 10%.

Creative Sample #8: Best-performing ad creative in the US

In Germany, there was no real interest. This could be because they advertised in English, and Germans are used to seeing ads in their own language, given that the market is large enough to support this.

Besides the paid media activities, the team engaged in organic social media content as well. “At Tigers Eye bra, Instagram focused on educational, demonstrative, and testimonial content, primarily delivered through short-form videos and carousel formats,” Farkas said.

RESULTS: First sales and positive ROAS

Within 40 days, the first 15 sales were made, and the ROAS exceeded 1. “At this early stage, having a ROAS greater than 1 indicates that the brand can scale, as profitability is not the main focus at this point,” he said.

This article was distributed through the MarketingSherpa email newsletter .

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Supply Chain Interdiction: The Mysterious Case of Exploding Pagers

As the world economy became increasingly globalized, supply chains also became more global. As a consequence, never in our industrial economic history had competition become so intense so quickly. North American companies compete not only with other North American companies, but also with companies around the globe. This has resulted in the expansion of the United States economy in many important sectors.

Manufacturing also became global. Commodities created from raw materials hailing from one part of the world, built in factories located in another part of the world, combined and bundled with other commodities located in still other parts of the world, were sold to consumers from Tokyo to Berlin.

Materials, components, and products can cross multiple geographies and regions in their journey through the supply chain, due to different tax structures, logistical efficiencies, and labor arbitrage differences. Therefore, depending on the product, demand, capacity, and other factors, companies can source materials and components for their products from other geographical regions, or may do so from local suppliers. The ability to coordinate with worldwide partners has increased because of the diffusion of the internet. Global sourcing has also increased. The majority of electronics sold in the U.S. are now produced in Asia, not in North America. As supply chains became more complex, however, it also became more difficult to find out exactly where materials, components, and products travelled in their path through the chain because, also by virtue of the internet, nearly anyone could become a seller or buyer at any point along the supply chain.

These complex supply chains make it increasingly easy for nefarious activities to be inserted into any point along the chain. This type of activity is called supply chain interdiction, and refers to the activities involved in interfering with the normal, designed processes of any supply chain. Interdiction can result in counterfeits being inserted into the distribution channel, sabotaging products, cyberhacking, data gathering, or any other type of illegal activity.

In the last few years, this potential for interdiction has only escalated, as companies like Amazon and Alibaba have made global competition more important than ever. (This has also led to other problems, such as increased sales of counterfeit products). Moreover, as cost competition has increased, organizations have “outsourced” more of their functions, to lower cost suppliers that are located in areas all over the world. More companies than ever before have outsourced their manufacturing capabilities to organizations called “contract manufacturers.” As Table 1, below, demonstrates, many are now headquartered in Asia. Even those that are headquartered in the United States, including Flextronics, Jabil, and Sanmina, have the majority of their factories in Asia (and some in Eastern Europe).

That contract manufacturers are now predominantly located in Asia reflects not only the shift in manufacturing from Europe and the United States to Asia, but also the shift in the location of the consumption of many finished electronic goods to Asia. In countries such as China, income and discretionary spending have increased at an unprecedented rate since 2000. [1]

• Although these contract manufacturers are located in Asia, they produce and distribute final products for major global brands, including Samsung, Apple, GE, Dell, Ford, Lenovo, Siemens, and other recognizable global brands, both locally and worldwide. With these shifts in global manufacturing, the structure of supply chains has also shifted.
• A few entities like Walmart have achieved near total control over their supply chains. [1] But Walmart is the exception. The vast majority of individual firms, including very large firms, do not have the same market power — and therefore capability — to manage all aspects of their supply chains, particularly since supply chains often include multiple firms with potentially conflicting objectives. Essentially no commodity or upstream component suppliers of which I am aware have such control or capability.
• While Walmart is one instance in which a single, powerful firm took primary responsibility for improving performance across its own supply chain and had the power to do so, nearly all companies in a modern global supply chain will only work with their immediate upstream suppliers and their immediate downstream customers. (This is sometimes referred to as “Tier 1” suppliers/customers.) They rarely have the ability to control or influence parties that are beyond this immediately-adjacent level. A second step removed is, in most cases, where a company’s insight and influence ends. This is particularly the case in industries — like manufacturing of pagers at issue in this case — where there are many competitors and the entities are not sole-source suppliers, but instead compete with other international firms to provide materials, components, or products to the same customer. As competition rises, the ability of any supplier of components to influence the activity of Tier 1 and later users diminishes. Notably, the WSJ reports that Gold Apollo operates in a very competitive space involving a low margin low volume product. As such, for companies in this space, there is often very little visibility and influence beyond “Tier 1” entities in a supply chain. Tier 1 was BAC Consulting, a shell company in Bulgaria, and Tier 2 was Norta Global, in Norway.  But even now, it is not clear how these shell companies were tied to the output of pagers. 

[1] Yuval Atsmon and Max Magni, “Meet the Chinese Consumer of 2020,” McKinsey Quarterly (March 2012), available at https://www.mckinsey.com/featured-insights/asia-pacific/meet-the-chinese-consumer-of-2020.

[2] Stalk, Evans & Shulman (1992), “Competing on capabilities: The new rules of corporate strategy”, HBR, Vol. 70, no. 2, pp. 57-69.

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Lessons from Amazon’s Early Growth Strategy

If you’re interested in strategies for scaling start-ups, this episode is for you.

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So much has been written about Amazon’s outsized growth. But Harvard Business School professor Sunil Gupta says it’s the company’s unusual approach to strategy that has captured his scholarly attention. Gupta has spent years studying Amazon’s strategy and its founder and former CEO Jeff Bezos.

In this episode, Gupta shares how Amazon upended traditional corporate strategy by diversifying into multiple products serving many end users, instead of having a narrow focus.

He argues that some of Amazon’s simplest business strategies — like their obsession with customers and insistence on long-term thinking — are approaches that companies, big and small, can emulate.

Key episode topics include: strategy, innovation, leadership, scaling, Jeff Bezos, long-term thinking, customer focus.

HBR On Strategy curates the best case studies and conversations with the world’s top business and management experts, to help you unlock new ways of doing business. New episodes every week.

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HANNAH BATES: Welcome to HBR On Strategy , case studies and conversations with the world’s top business and management experts, hand-selected to help you unlock new ways of doing business.

So much has been written about Amazon’s outsized growth. But Harvard Business School professor Sunil Gupta says it’s the company’s unusual approach to strategy that has captured his scholarly attention.

Gupta has spent years studying Amazon’s strategy and its founder and former CEO, Jeff Bezos.

In this episode, Gupta shares how Amazon upended traditional corporate strategy by diversifying into multiple products serving many end users instead of focusing more narrowly.

And he argues that some of their simplest business strategies – like their obsession with the customer and insistence on long-term thinking – are approaches that companies, big and small, should emulate.

If you’re interested in innovation strategy, this episode is for you. It originally aired on HBR IdeaCast in November 2020. Here it is.

ALISON BEARD:  Welcome to the HBR IdeaCast from Harvard Business Review.  I’m Alison Beard.

If you had to name the most successful business leader alive today, who would you say?  I can’t hear you from my basement podcasting room, but I would bet that for many of you, the answer is Jeff Bezos, CEO of Amazon.  This is a man who over the past 25 years turned his online bookstore startup into a diversified company currently valued at $1.6 trillion.

Amazon is a digital retailing juggernaut, it’s also a web services provider, media producer, and manufacturer of personal technology devices like Kindle and Echo.  Oh, and Bezos also owns the Washington Post and Blue Origin, a space exploration company.  Forbes tells us he is the richest person in the world.

How did he accomplish so much?  How did he change the business landscape?  What mistakes has he made along the way?  A new collection of Bezos’s own writing, which full disclosure, my colleagues at Harvard Business Review Press have published, offer some insights.  Here’s a clip from one speech that’s included.  The book is called Invent and Wander.

And our guest today, who has spent years studying both Amazon and Bezos, is here to talk with me about some of the key themes in it, including the broad drivers of both the company and the CEO’s success.  Sunil Gupta is a professor of business administration at Harvard Business School and cochair of its executive program, and cochair of its executive program on driving digital strategy, which is also the title of his book.  Sunil, thanks so much for being on the show.

SUNIL GUPTA:  Thank you for having me, Alison.

ALISON BEARD:  So Invent and Wander.  I get that Bezos is inventive.  You know, he created a new way for us to buy things – everything.  How is he also a wonderer?

SUNIL GUPTA:  So he’s full of experiments.  His company and his whole style is known for experimentation, and he says that in so many words that if you want big winners, then you have to be willing to have many failures.  And the argument is, one big winner will take care of a thousand failed experiments.  So I think that’s the wandering part.  But also his experiments are not aimless.  There is a certain thought and process behind what experiments to do and why they will connect to the old, old picture of what Amazon is today.

ALISON BEARD:  And your expertise is in digital strategy.  How does he break the traditional rules of strategy?

SUNIL GUPTA:  So for the longest time the way, at least I was taught in my MBA program and the way we teach to our MBA students and executives, is strategy is about focus.  But if you look at Amazon, Amazon certainly doesn’t look like it’s focusing on anything, so obviously Jeff Bezos missed that class, otherwise it’s a very, very different thing.

And then you’d say, why is it that so called lack of focus strategy seems to be working for Amazon?  And I think the fundamental underlying principle that he’s guiding his whole discussion of strategy is, he’s changed the rules of strategy.  So the old rules of strategy were, the way you gained competitive advantage is by being better or cheaper.  So if I am selling you a car, my car is better of cheaper.  But the inherent assumption in that strategy statement is, I’m selling one product to one customer.  And what Amazon is basically arguing is, the digital economy is all about connection.  We have got to connect products and connect customers.  Let me explain why that is so powerful.

So connecting products, here the idea is, I can sell you, this is a classic razor and blade strategy.  I can sell you a razor cheap in order to make money on the blade.  So I can sell you Kindle cheap in order to make money on the ebooks.  Now, at some level you might say, hey, razor and blade have been around forever.  What’s so unique today?  I think unique today is razor could be in one industry and blades could be in completely different industrys.

So for example, if you look at Amazon’s portfolio of businesses, you sort of say, not only Amazon is an e-commerce player, but also is making movies and TV shows, its own studio.  Well, why does it make sense for an e-commerce player, an online retailer to compete with Hollywood.  Well, Walmart doesn’t make movies.  Macy’s doesn’t make movies?  So why does it make sense for Amazon to make movies?

And I think once you dig into it, the answer becomes clear that the purpose of the movies is to keep and gain the Prime customers. Two day free shipping is fine, but if  you ask me to pay $99 or $119 for two day free shipping, I might start doing the math in my head, and say, OK, how many packages do I expect to get next year?  And is the Prime membership worth it or not?

But once you throw in, in addition to the two-day free shipping, you throw in some TV shows and movies that are uniquely found only on Amazon, I can’t do this math.  And why is Prime customers important to Amazon?  Because Prime customers are more loyal.  They buy three or four times more than the non-Prime customers, and they’re also less price sensitive.

And in fact, Jeff Bezos has said publicly that every time we win a Golden Globe Award for one of our shows, we sell more shoes.  So this is, and he said it in your book, Invent and Wander, also, that we might be the only company in the world which has figured out how winning Golden Globe Awards can actually translate into selling more products on the online commerce.

So this is a great example of the razor being in a very different industry and blade being in another industry.  Take another example.  Amazon has a lending business where they give loans to small and medium enterprises. If Amazon decides to compete with banks tomorrow, Amazon can decide to offer loans to the small merchants at such a low price that banks would never be able to compete.  And why would Amazon be able to do that?  Because Amazon can say, hey, I’m not going to make money on loans, as much money on loans, but I’ll make more money when these businesses, small businesses grow and do more transactions on my marketplace platform.  And I get more commissions.  So again, loan can become my razor in order to help the merchants grow and make money on the transaction and the commission that I get from that.  The moment I make somebody else’s, in this case the banks, core business my razor, they will make a very hard time competing.  So I think that’s the key change, the fundamental rules of strategy and competition in that direction.

The second part of connection is connecting customers, and this is the classic network effect.  So marketplace is a great example of network effects.  The more buyers I have, the more sellers I have.  The more sellers I have, the sellers I have, the more buyers I get, because the buyers can find all the items.  And that becomes flywheel effect, and it becomes a situation where it’s very hard for a new player to complete with Amazon.

ALISON BEARD:  In this diversification that Amazon has done, how have they managed to be good at all of those things?  Because they’re not focused.  You know, they’re not concentrated on an area of specific expertise.  So how have they succeeded when other companies might have failed because they lacked that expertise, or they were spreading themselves too thin?

SUNIL GUPTA:  So I think it depends on how you define focus.  Most of us, when we define focus, we sort of define focus by traditional industry boundaries, that I’m an online retailer, therefore going into some other business is lack of focus.  The way Amazon thinks about is focus on capabilities.

So if you look at it from that point of view, I would argue that Amazon had three fundamental core capabilities.  Number one, it’s highly customer focused, not only in its culture, but also in its capability in terms of how it can actually handle data and leverage data to get customer insight.  The second core capability of Amazon is logistics.  So it’s now a world class logistics player.  It uses really frontier technology, whether it’s key word, robotics, computer vision, in its warehouse to make it much more efficient.

And the third part of Amazon’s skill or the capability is its technology.  And a good example of that is Amazon Web Services, or AWS.  And I think if you look at these three core capabilities, customer focus and the data insight that it gets from that, the logistics capability, and the technology, everything that Amazon is doing is some way or the other connected to it.  In that sense, Amazon, and there’s no lack of focus, in my judgment on Amazon.

Now, if he starts doing, starts making cream cheese tomorrow or starts making airplane engines, then I would say, yes, it’s got a lack of focus.  But one of the other things that Jeff Bezos has said again and again is this notion of work backwards and scale forward.  And what that means is, because you’re customer obsessed, you sort of find ways to satisfy customers, and if that means developing new skills that we don’t have because we are working backwards from what the customer needs are, then we’ll build those skills.

So a good example of that is, when Amazon started building Kindle, Amazon was never in the hardware business.  It didn’t know how to build hardware.  But Bezos realized that as the industry moved, people are beginning to read more and more online, rather, or at least on their devices, rather than the physical paper copy of a book.  So as a result, he says, how do we make it easier for consumers to read it on an electronic version?  And they’re spending three years learning about this capability of hardware manufacturing.  And by the way, Kindle came out long before iPad came out.  And of course, that capability now has helped them launch Echo and many other devices.

ALISON BEARD:  Right.  So it’s the focus on the customer, plus a willingness to go outside your comfort zone, the wander part.

SUNIL GUPTA:  Exactly.

ALISON BEARD:  Yeah.  How would you describe Bezos’s leadership style?

SUNIL GUPTA:  So I think there are at least three parts to it.  One is, he said right from day one that he wants to be a long-term focus.  The second thing is being customer obsessed.  And many times he has said that he can imagine, in the meetings he wants people to imagine an empty chair.  That is basically for the customer. And he says, we are not competitor focused.  We are not product focused.  We are not technology focused.  We are customer focused.  And the third is, willingness to experiment.  And fail, and build that culture in the company that it’s OK to fail.

ALISON BEARD:  What about personally, though?  Is he a hard charger?  Is he an active listener?  What’s it like to be in a room with him?

SUNIL GUPTA:  Oh, he’s certainly a hard charger.  I mean, he’s also the kind of guy, when he hires people, he says, you can work long, hard, or smart.  But at Amazon, you can choose two out of three.  And I think this is similar to many other leaders.  If you look at Steve Jobs, he was also a very hard charging guy.  And I think some people find it exhilarating to work with these kind of leaders.  Some find it very tough.

ALISON BEARD:  Do you think that he communicates differently from other successful CEOs?

SUNIL GUPTA:  So the communication style that he has built in the company is the very famous now, there’s no PowerPoints.  So it’s a very thoughtful discussion.  You write six-page memos, which everybody, when their meeting starts, everybody sits down and actually reads the memo.

In fact, this was a very interesting experience that I had.  One of my students, who was in the executive program, works at Amazon in Germany.  And he is, he was at that point in time thinking of moving to another company and becoming a CEO of that company.  So he said, can I talk to you about this change of career path that I’m thinking about?  I said, sure.  So we set up a time, and five minutes before our call, he sends me an email with a six-page memo.  And I said, well, shouldn’t he have sent this to me before, so I could at least look at it?  He says, no, that’s the Amazon style.  We’ll sit in silence and read it together.  And so I read it together, because then you’re completely focused on it.  And then we can have a conversation.  But this discipline of writing a six-page memo, it’s a very, very unique experience, because you actually have to think through all your arguments.

ALISON BEARD:  You also mentioned the long term focus, and that really stood out for me, too, this idea that he is not at all thinking of next year.  He’s thinking five years out, and sometimes even further.  But as a public company, how has Amazon been able to stick to that?  And is it replicable at other companies?

SUNIL GUPTA:  I think it is replicable.  It requires conviction, and it requires a way to articulate the vision to Wall Street that they can rally behind.  And it’s completely replicable.  There are other examples of companies who have followed a similar strategy.  I mean, Netflix is a good example.  Netflix hadn’t made money for a long period of time.  But they sold the vision of what the future will look like, and Wall Street bought that vision.

Mastercard is exactly the same thing.  Ajay Banga is giving three year guidance to Wall Street saying, this is my three-year plan, because things can change quarter to quarter.  I’m still responsible to tell you what we are doing this quarter, but my strategy will not be guided by what happens today.  It will be guided by the three-year plan that we have.

ALISON BEARD:  There are so many companies now that go public without turning any profit, whereas Amazon now is printing money, and thus able to reinvest and have this grand vision.  So at what point was Bezos able to say, right, we’re going to do it my way?

SUNIL GUPTA:  I think he said it right from day one, except that people probably didn’t believe it.  And in fact, one of the great examples of that was, when he was convinced about AWS, the Amazon Web Services, that was back in the early 2000s, when a majority of the Wall Street was not sure what Jeff Bezos was trying to do, because they say, hey, you are an online retailer.  You have no business being in web services.  That’s the business of IBM.  And that’s a B2B business.  You’re in a B2C business.  Why are you going in there?

And Bezos said, well, we have plenty of practice of being misunderstood.  And we will continue with our passion and vision, because we see the path.  And now he’s proven it again and again why his vision is correct, and I think that could give us more faith and conviction to the Wall Street investors.

SUNIL GUPTA:  Oh, absolutely.  And he’s one of the persons who has his opinion, and you always surround yourself with people better than you.

ALISON BEARD:  How has he managed to attract that talent when it is so fiercely competitive between Google, Facebook, all of these U.S. technology leaders?

SUNIL GUPTA:  So a couple of things I would say.  First of all, it’s always good fun to join a winning team.  And all of us want to join a winning team, so this certainly is on a trajectory which is phenomenal.  It’s like a rocket ship that is taking off and has been taking off for the last 25 years.  So I think that’s certainly attractive to many people, and certainly many hard charging people who want to be on a winning team.

And a second thing is, Amazon’s culture of experimentation and innovation.  That is energizing to a lot of people.  It’s not a bureaucracy where you get bogged down by the processes.  So the two type of decisions that we talked about, he gives you enough leeway to try different things, and is willing to invest hundreds of millions of dollars into things that may or may not succeed in the future.  And I think that’s very liberating to people who are willing to take on the ownership and build something.

ALISON BEARD:  But don’t all of the tech companies offer that?

SUNIL GUPTA:  They do, but if you think about many other tech companies, they’re much more narrow in focus.  So Facebook is primarily in social media.  Google is primarily in search advertising.  Yes, you have GoogleX, but that’s still a small part of what Google does.  Whereas if you ask yourself what business is Amazon in, there are much broader expansive areas that Amazon has gone into.  So I think the limits, I mean, Amazon does not have that many limits or boundaries as compared to many other businesses in Silicon Valley.

ALISON BEARD:  So let’s talk a little bit about Bezos’s acquisition strategy.  I think the most prominent is probably Whole Foods, but there are many others.  How does he think about the companies that he wants to bring in as opposed to grow organically?

SUNIL GUPTA:  So some acquisitions are areas where he thinks that he can actually benefit and accelerate the vision that he already has.  So for example, the acquisition of Kiva was to improve the efficiency and effectiveness of the systems that he already put in place in his warehouse.  And logistics and warehouse is a key component or key part of Amazon’s business, and he saw that Kiva already was ahead of the curve in technology that he probably wanted to have that in his own company.  So that was obvious acquisition, because that fits in the existing business.

Whole Foods is kind of a slightly different story, in my judgment, because I some ways, you can argue, why is Amazon, an online player, buying an offline retail store, Whole Foods?  And in fact, they bought it at 27% premium.  So that doesn’t make sense for an online retailer commerce to go to offline channels.  And I think, in fact, part of the reason in my judgment is, it’s not just Whole Foods, but it’s about the food business, per se.  And why is Amazon so interested in food?  In fact, Amazon has been trying this food business, online food delivery for a long period of time without much success.  And Whole Foods was one, another way to try and get access to that particular business.  And why is that so important to Amazon, even though you could argue, food is a low margin business?

And I would say, part of the reason is, food is something, grocery is something that you buy every week, perhaps twice a week.  And if I, as Amazon, can convince you to buy grocery online from Amazon, then I’m creating a habit for you to come onto Amazon every week, perhaps twice a week.  And once you are on Amazon, you will end up buying other products on Amazon.  Whereas if you are buying electronics, you may not come to Amazon every day.

So this is a habit creation activity, and again, it may not be a very high margin activity to sell you food.  But I’ve created a habit, just like Prime.  I’ve created a loyal customer where you think of nothing else but Amazon for your daily needs, and therefore you end up buying other things.

ALISON BEARD:  And Amazon isn’t without controversy.  You know, and we should talk about that, too.  First, there are questions about its treatment of warehouse employees, particularly during COVID.  And Bezos, as you said, has always been relentlessly focused on the customer.  But is Amazon employee centric, too?

SUNIL GUPTA:  So I think there is definitely some areas of concern, and you rightly said there is a significant concern about the, during the COVID, workers were complaining about safety, the right kind of equipment.  But even before COVID, there were a lot of concerns about whether the workers are being pushed too hard.  They barely have any breaks.  And they’re constantly on the go, because speed and efficiency become that much more important to make sure customers always get what they are promised.  And in fact, more than promised.

Clearly Amazon either hasn’t done a good job, or hasn’t at least done the public relations part of it that they have done a good job.  Now, if you ask Jeff Bezos, he will claim that, no, actually, they have done things.  For example, they offer something called carrier choice, where they give 95% tuition to the employees to learn new skills, whether they’re relevant to Amazon or not.  Pretty much like what Starbucks does for its baristas, for college education and other things.  But I think more than just giving money or tuition, it requires a bit of empathy and sense that you care for your employees, and perhaps that needs, that’s something that Amazon needs to work on.

ALISON BEARD:  And another challenge is the criticism that it has decimated mom and pop shops.  Even when someone sells through Amazon, the company will then see that it’s a popular category and create it itself and start selling it itself.  There’s environmental concerns about the fact that packages are being driven from warehouses to front doors all over America.  And boxes and packaging.  So how has Bezos, how has the company dealt with all of that criticism?

SUNIL GUPTA:  They haven’t.  And I think those are absolutely valid concerns on both counts, that the small sellers who grow to become reasonably big are always under the radar, and there are certainly anecdotal evidence there, small sellers have complained that Amazon had decided to sell exactly the same item that they were so successful in selling, and becoming too big is actually not good on Amazon, because Amazon can get into your business and wipe you away.  So that’s certainly a big concern, and I think that’s something that needs to be sorted out, and Amazon needs to clarify what its position on that area is, because it benefits from these small sellers on his platform.

And your second question about environmental issues is also absolutely on the money, because not only emission issues, but there’s so many boxes that pile in, certainly in my basement, from Amazon.  You sort of say, and it’s actually ironical that Millennials who are in love with Amazon are extremely environmentally friendly.  But at the same time, they would not hesitate to order something from Amazon and pile up all these boxes.  So I think Amazon needs to figure out a way to think about both those issues.

ALISON BEARD:  And at what point will it have to?  I mean, it seems to be rolling happily along.

SUNIL GUPTA:  Well, I think those issues are becoming bigger and bigger, and it’s certainly in the eye of the regulators, also, for some of these practices.  And not only because it’s too big, and there might be monopoly concerns, but these issues will become larger, and any time you become a large company, you become the center of attraction for broader issues than just providing shareholder value.

ALISON BEARD:  Yeah.  So those are weaknesses possibly for the company.  What are some of Bezos’s personal weaknesses that you’ve seen in studying him and the company?

SUNIL GUPTA:  So I think one thing that stands out to me, and at least in the public forums, I have not seen any empathy.  And it’s, I mean, we talk about that the leaders have, should have three qualities.  They should be competent.  They should have a good character.  And they should have compassion.  So he’s certainly very competent.  I mean, he’s brilliant in many aspects, right, from the computer vision and AI and machine learning, to the nuances of data analytics, to the Hollywood production, etc.  He also seems to have good character, at least I have not heard any personal scandals, apart from his other issues in his personal life, perhaps.

Those characteristics of competence and character make people respect you.  What makes people love you is when you show compassion, and at least I haven’t seen compassion or empathy that comes out of him.  I mean, he certainly comes across as a very hard charging, driven person, which probably is good for business.  But the question of empathy is perhaps something lacking right now.

ALISON BEARD:  Yeah.  The other issue is his just enormous wealth.  He did invent this colossally valuable company, but should anyone really be that rich?

SUNIL GUPTA:  Well, I guess that’s, you can say that’s the good or the bad thing about capitalism.  But I think, and again, my personal view is there’s nothing wrong in becoming rich, if you have been successful and done it with hard work and ingenuity.  But how you use your wealth is something that perhaps will define Jeff Bezos going forward.  I think Bill Gates is a great example how he actually has used his wealth and his influence and his expertise and his brilliance into some certain thing that actually is great for humanity.

Now, whether Jeff Bezos does that down the road, I don’t know, whether his space exploration provides that sort of outlet which is both his passion as well as good for humanity, I don’t know.  But at some point in time, I think it’s the responsibility of these leaders to sort of say, my goal is not simply to make money and make my shareholders rich, but also help humanity and help society.

ALISON BEARD:  If you’re talking to someone who’s running a startup, or even a manager of a team at a traditional company, what is the key lesson that you would say, this is what you can learn from Jeff Bezos?  This is what you can put to work in your own profession?

SUNIL GUPTA:  So I would say two things that at least I would take away if I were doing a startup.  One is customer obsession.  Now, every company says that, but honestly, not every company does it, because if you go to the management meetings, if you go to the quarterly meetings, you suddenly go focus on financials and competition and product.  But there’s rarely any conversation on customers.  And I think, as I mentioned earlier, that Jeff Bezos always tells his employee to think of the imaginary chair in which a customer is sitting, because that’s the person that we need to focus on.  Howard Shultz does the same thing at Starbucks, and that’s why Starbucks is so customer focused.

So I think that’s the first part.  And the argument that Bezos gives is, customers are never satisfied.  And that pushes us to innovate and move forward, so we need to innovate even before the rest of the world even sees that, because customers are the first ones to see what is missing in the offering that you have.

And the second I would say that I would take away from Jeff Bezos is the conviction and passion with what you do.  And many times that goes against the conventional wisdom.  And the Amazon Web Services is a great example of that.  The whole world, including the Wall Street Journal and the Wall Street analysts were saying, this is none of Amazon’s business to do web services.  But he was convinced that this is the right thing to do, and he went and did that.

And part of that conviction may come from experiments.  Part of that conviction comes from connecting the dots that he could see that many other people didn’t see.  I mean, that’s why he went, left his job, and went to Seattle to do the online bookstore, because he could see the macro trends as to what the Internet is likely to do.  So, I think that’s the vision that he had.  And once you have the conviction, then you follow your passion.

ALISON BEARD: Sunil, thanks so much for coming on the show.

SUNIL GUPTA:  Thank you for having me. Alison.

HANNAH BATES: That was Harvard Business School professor Sunil Gupta, in conversation with Alison Beard on the HBR IdeaCast .

We’ll be back next Wednesday with another hand-picked conversation about business strategy from Harvard Business Review. If you found this episode helpful, share it with your friends and colleagues, and follow our show on Apple Podcasts, Spotify, or wherever you get your podcasts. While you’re there, be sure to leave us a review.

And when you’re ready for more podcasts, articles, case studies, books, and videos with the world’s top business and management experts, find it all at HBR.org.

This episode was produced by Mary Dooe, Anne Saini, and me, Hannah Bates. Ian Fox is our editor. And special thanks to Maureen Hoch, Nicole Smith, Erica Truxler, Ramsey Khabbaz, Anne Bartholomew, and you – our listener. See you next week.

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InfoQ Homepage Articles Building Better Platforms with Empathy: Case Studies and Counter-Examples

Building Better Platforms with Empathy: Case Studies and Counter-Examples

Sep 23, 2024 9 min read

David Stenglein

reviewed by

Aditya Kulkarni

Key Takeaways

• Empathy is the ability to see experiences from someone else's perspective, sharing their emotions (positive or negative) based on understanding their experience, unlike sympathy which focuses on acknowledging distress.
• Organizations adopt platforms to manage the increasing complexity of growth, which strains the DevOps model as security, compliance, performance, and other operational demands create an overwhelming cognitive load on developers.
• Building your platform as a product promotes a customer-centric approach. We recognise that internal users have choices and may resort to shadow IT if the platform doesn't meet their needs.
• Building a culture of empathy, modeled through open communication and active listening, empowers you to understand users' true needs and fosters leadership from all levels of the organization.
• The DevEx framework helps identify key areas for platform improvement by focusing on the interconnected elements of feedback loops, cognitive load, and flow state, ultimately addressing user pain points.

When it comes to platform development, achieving scale often involves absorbing excess cognitive burdens into the platform's framework. An important aspect of constructing these platforms lies in fostering empathy. Rather than viewing individuals only through the lens of their issues, it's imperative to recognize them as people. Focusing on more than just specific issues can narrow down solutions unnecessarily. But, taking time to listen and understand diverse challenges leads to better results.

At my QCon San Francisco 2023 presentation, I emphasized the importance of integrating empathy into platform development.

Drawing Lessons from a Costly Error

After securing stakeholder approval, we embarked on a project to extend a cloud-native platform (that we had originally built), leveraging the robust Netflix stack with its blue-green deployments and relevant tools. We set out with a goal to address current usability issues with the platform.

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Confident in our understanding of the platform's needs, we dove into the development. However, as we began demoing the new functionality to users — who were different from the project's stakeholders — we encountered negative feedback. Despite repeated iterations and demonstrations, it became increasingly clear that a significant gap existed between user expectations and our development direction.

Eventually we realized that users would never adopt what we were building and the project was cancelled. A sizeable budget had been spent with no return. What had begun as a well-intentioned attempt to empower teams ended in disappointment, highlighting the contrast between our hypothesis and the users' reality.

In hindsight, we recognized the critical oversight of not considering user perspectives. Our assumption of alignment proved incorrect, highlighting the importance of genuine user engagement and feedback in guiding successful project outcomes.

Significance of Empathy

Let's distinguish between empathy and sympathy. Sympathy involves reacting to someone in distress without necessarily understanding their perspective. Empathy, on the other hand, means understanding experiences from another person's viewpoint.

It's crucial to differentiate empathy from sympathy, as sympathy merely involves acknowledging negative emotions or feeling distress when witnessing someone else's suffering. For instance, the image below might evoke empathy in individuals who have experience with server rooms, allowing them to understand what the person shown below is going through. Empathy extends beyond negative emotions; it can also involve sharing in someone else's excitement or joy.

Empathy has its do's and don'ts.

First, listen without immediately jumping to solutions — which is a challenge with many technical-minded individuals. Instead of assuming and solving, ask probing questions to understand the person's experience and needs better.

Practice active listening by asking open-ended questions that uncover core issues and pains. Embrace vulnerability by admitting what you don't know, rather than rushing to demonstrate capability. Avoid the urge to explain why someone's approach is wrong; this can make the person feel isolated rather than empathized. Similarly, refrain from minimizing concerns; comparing their experience won't foster empathy or understanding.

Why do we build platforms?

Organizations adopt platforms to streamline operations when expansion leads to complexity. DevOps culture encouraged engineers to take ownership, improving speed by removing bottlenecks from the other teams. However, as companies grow, the demands of security, compliance, performance, and other factors create a cognitive load.

Cognitive load is a topic studied in academic research. It investigates how the difficulty of a learning task affects people. The right balance of cognitive load helps a person better absorb new information in a learning environment. This idea has also been applied to understand workplace tasks. NASA has an interesting concept called mental workload, developed during the shuttle program. This concept builds upon the idea of cognitive load by adding in the impact of deadlines, environmental factors, and other stressors that we can sometimes face.

Cognitive load has three primary components. Intrinsic cognitive load describes the underlying complexity of the task at hand – like figuring out your route to the supermarket and the act of driving itself. Germane cognitive load represents the knowledge and skills you need for the task – having a driver's license and knowing how to operate a car. Finally, extraneous cognitive load encompasses distractions that hinder your focus – such as unexpected traffic or detours that force you to adjust your route.

At an enterprise level, when too many people are involved in too many processes, extraneous cognitive load increases exponentially. This leads to lower overall organizational efficiency. Platforms achieve scale by absorbing much of this extraneous cognitive load. They either directly capture work, eliminating the need for users to do it, or significantly simplify it through abstraction. For any remaining tasks that can't be fully eliminated, platforms strive to make them as easy as possible for users to interact with.

Building your platform as a product makes sense for several reasons that align with a customer-focused mindset. Products have customers, and customers have options. This differs from how we typically treat internal tools. However, we've seen situations where internal customers reject what's provided, opting to use their resources to purchase solutions elsewhere – giving rise to shadow IT.

Building a Platform That Delivers Results

By treating your platform as a product, you prioritize making it the best solution. This is crucial, as the alternative (users refusing to migrate or adopt your platform) is equally undesirable. A non-compelling platform can simply become another layer in the company's growing tech stack, failing to solve real user problems. It may linger without being officially canceled, ultimately contributing to the company's tech debt rather than providing value.

The old approach was highly transactional. Users would submit requests through a ticketing system – asking for a specific feature or a change to the build system. We'd either try to incorporate these requests into the platform directly or figure out ways to automate them to handle the volume. Unfortunately, this old method resulted in limited understanding and empathy due to its reactive nature.

Platform engineering centers around building for others, not yourself. This marks a fundamental mindset shift compared to traditional systems administration. Sysadmins and even DevOps engineers focused on maintaining and modifying the shared components of a system. In contrast, platform engineering teams build a self-service product for others to utilize. The new focus is on creating an appealing product, which requires understanding your users' needs. By employing empathy and stepping into your users' shoes, you'll be far more successful than simply offering solutions based on assumptions about their requirements.

This approach offers significant benefits. By focusing on building what users actually need, based on their direct feedback, you optimize the use of company resources. For example, if you develop five features but only two are truly valuable to internal customers, the remaining three represent wasted effort and contribute to tech debt. However, if all five features are genuinely useful to engineering teams, you'll significantly boost their effectiveness. This approach leads to accelerated growth and, likely, much higher employee satisfaction.

Much of developer experience focuses on satisfaction, and for good reason. By understanding user needs, building solutions for them, and actively eliminating their pain points, you naturally create happier engineers. This sets up a virtuous cycle: start by identifying what users need and then build it – they will adopt it. This increases overall company efficiency and effectiveness, further increasing user satisfaction. The cycle continues. Alternatively, if you build something without this approach and expect adoption, the cycle stalls if users don't engage. You've inadvertently hindered the company's potential for greater efficiency and created a roadblock to this positive cycle.

Leveraging Empathy for Results

To use empathy when building platforms, you need to create a culture of empathy. Since we're dealing with human emotions, establishing a cultural foundation is crucial. This means actively encouraging everyone to practice listening – focusing on understanding others rather than immediately formulating a response. Additionally, it's important to get to know coworkers and customers as individuals. Building these connections makes it easier to step into their shoes, shadow them, and understand their experiences – all of which are essential for building with empathy.

From a product perspective, building a culture of empathy empowers you to have honest conversations with users about their true needs, going beyond mere requests. This starts with modeling the desired behavior yourself. By actively demonstrating this approach with both coworkers and customers, you set an example for others to follow. Remember, leadership can come from any level of the organization – you don't need a managerial title to showcase these principles.

Use Product Management practices to deeply understand your users, their pain points, and the solutions they need. These techniques are equally beneficial when building internal platforms. For example, surveys can be beneficial to acquire subjective data. To grasp someone's perspective, you need to understand how they feel about the system – not just measure deployment frequency or other objective metrics. Survey your users directly, asking questions like "Do you feel you're as effective as you could be?" This type of feedback is surprisingly valuable for platform development.

The DevEx framework also offers a powerful way to identify crucial improvement areas and ask the right questions about how your platform can address user pain points. This is because its elements – feedback loops, cognitive load, and flow state – are deeply intertwined. For example, if slow build times disrupt feedback loops, addressing that directly will help users stay in a flow state for longer. Similarly, if you streamline deployment options, reducing the complexity within AWS, you lower cognitive load and boost efficiency. The emphasis on flow state is vital – the longer users remain focused and productive, the more value they generate for the company.

I believe that any organization benefits greatly from having software engineers join the platform engineering team. This diversity of perspectives is crucial for ensuring the team builds the right solutions and truly satisfies its internal customers. At the same time, platform engineers should actively work alongside their customer teams – the developers – to gain a firsthand understanding of their day-to-day experience. This reciprocal approach fosters a deeper understanding of both sides.

Empathy means seeing people first, not just problems. By connecting with the person, you open yourself to a wider range of solutions. Focusing solely on fixing a specific issue prematurely limits your options. Taking the time to actively listen and understand the person and their broader challenges will ultimately lead to much more effective solutions.

Always remember your target audience: you're not building for yourself. As a platform team crafting a product, you're building for your customers. Keeping this mindset at the forefront will guide you towards addressing their needs. Much of what we discussed in this article is actionable on a personal level – integrating product management techniques, etc. But if you're part of a platform team, you can start making a difference right away. Focus on active listening and resist offering immediate solutions.

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