Growth Product Management: What You Need to Know

Sean Ellis coined the term “growth hacking” in 2010 to describe the use of low-cost, customer-centric, and data-led initiatives to quickly acquire and keep customers. Silicon Valley behemoths, including Uber, Pinterest, and Airbnb, used the growth hacking product management methodology in their infancy. Growth metrics have since become intrinsic to product marketing and often inform investment rounds. Whereas once a large profit margin was seen as the predictor of prosperity, a high user growth rate has now become synonymous with success.

In their fledgling years, Netflix, Slack, and Facebook had average user adoption rates of 74%, 188%, and 200%, respectively. A focus on growth is not just the remit of startups, however. What has made these companies true powerhouses is that their appetite for growth extended beyond their wild initial success. Even established businesses must have a mindset of continuous improvement to keep up with the competition. As such, it was only a matter of time before a product manager growth role was created.

An analysis of Google trends for the search term “growth product manager” reveals an impressive 149% increase in average monthly interest from 2017 to 2021. Companies such as Dropbox and TikTok already staff for growth product managers (GPMs), and other SaaS businesses are increasingly recognizing the role’s value. As it cements its place in Silicon Valley, hiring managers and leaders elsewhere may be wondering: What does a GPM do, and should we be recruiting one?

What Is a Growth Product Manager?

Although you may have heard of growth product management, you may not know what it translates to in terms of responsibilities. The role of a GPM is strongly tied to marketing strategy with a core aim to drive the impact of products, in turn contributing to wider business goals, such as bigger market share or increased revenue. A GPM works across all stages of the customer journey, leading experiments and using the results to suggest data-driven product improvements.

Businesses with product-led growth strategies will benefit most from a GPM, as customer acquisition and retention are driven not by sales and marketing but by prioritizing the end user and working to provide an exceptional product experience. Take Netflix, for example. Did an ad for the service or another form of targeted marketing compel you to sign up? Most likely not. You were probably introduced to the brand by a friend or family member who loved the product.

Consider the Netflix homepage, which becomes more personalized to the customer’s preferences with each selection. The implementation of this feature was led by user research and data, which found that Netflix needs to capture a user’s attention in the first 90 seconds and that artwork has the biggest influence on what users choose to watch. Before being introduced, the initiative underwent extensive A/B testing.

The offering not only differentiated Netflix from other media outlets at the time, but also helped viewers find the content they wanted faster—a perfect example of a user-focused, product-led growth initiative.

And while this was a growth initiative, the feature would have been approved and implemented by the product manager (PM) and their team. PMs and GPMs work toward improving the quality and performance of products, but they do so in different ways and are led by different aims. These competing priorities have the potential to cause friction, so it’s important to define the distinction between the roles.

PM vs. Growth PM

While growth product management is a subcategory of product management, the roles require different skill sets. As prioritizing growth becomes standard practice, the gap between the roles may narrow, but for now they are markedly distinct.

While a PM usually works on a single product and is driven by providing long-term value to the customer, a GPM may work across multiple products and is guided by the commercial goals of the company. Whereas a PM owns the product strategy and roadmap, leads their team, and manages stakeholder relationships, the primary focus of a GPM is on shortening the time to value: They prioritize goals and outcomes on a shorter timeline than PMs.

GPMs are most valuable when they work on existing products that already solve user pain points but are not yet optimized. Essentially, they enable customers to get what they need from the product faster. Organizations should first recruit PMs to build and launch products, then they should hire GPMs to help improve them.

What Does a Growth Product Manager Do?

Quality data is the foundation of growth product management. As the saying goes, what cannot be measured cannot be managed. GPMs track metrics to identify opportunities for improvement, assess the outcomes of their experiments, and make evidence-based decisions for products.

The metric or metrics that a GPM may home in on will likely be defined by the business’s objective, which often manifests as the One Metric That Matters—the one number that a company is focused on above all else. In their day-to-day, though, a GPM will monitor growth metrics specifically. The most commonly used set of growth metrics is known as the AARRR Pirate Metrics framework, which breaks down the sales funnel every customer moves through and comprises five ways GPMs can track growth based on user behavior:

• Acquisition: How successful are you at getting your product in front of customers?
• Activation: How successful are you at convincing customers to try your product?
• Retention: How successful are you at keeping your customers engaged?
• Referral: How successful are you at getting customers to recommend your product?
• Revenue: How successful are you at monetizing your product?

Here is a breakdown of the actions a GPM might use to measure each of the five metrics:

Source: Dave McClure

Monitoring these metrics will give a GPM insight into where they should focus their energy, i.e., where the product’s weaknesses lie. These metrics are interlinked, so changing one metric will likely have an impact on others. A good analogy is a bucket of water: If the bucket is full of holes, you can add as much water as you want (customer acquisition and activation), but the bucket will never fill up (customer retention), so putting the water to use (gaining revenue) will be more difficult.

What Skills and Knowledge Should a Growth Product Manager Have?

GPMs are change agents who have specific process knowledge and interdisciplinary skills. They can come from a variety of backgrounds, including engineering, data analytics, digital marketing, and product consulting. Regardless of their experience, these five skills and characteristics are crucial for growth product managers to be effective:

1. A robust understanding of the user journey

In order to suggest improvements, GPMs need a deep understanding about how users experience and interact with products and the common problems they face. This requires familiarity with customer research and journey mapping.

2. An entrepreneurial approach

A GPM needs to continually question the status quo. They need a willingness to experiment and resilience when experiments fail. A GPM will thrive by being curious, creative, and disruptive.

3. An analytical, data-driven mindset

A GPM’s choices must be grounded in evidence, so they must use analytics tools to monitor and evaluate product metrics. They need to run multiple experiments in tandem, analyze the results, and turn those results into actionable changes.

4. Strong cross-functional communication

GPMs need to communicate with their team (if they have one), other teams, and PMs. They must articulate and demonstrate the changes they recommend and why they are crucial. As the role is still fairly new, GPMs may have to educate their colleagues on what they do—and how they do it—to avoid friction.

5. Patience

GPMs continually monitor metrics, conduct tests over time, and look for opportunities to make improvements. Changes to a product will not necessarily add value immediately, so patience is key.

The Scope of a Growth Product Manager

While the core responsibility of the GPM remains the same, the role can vary depending on the size and maturity of the business. There are significant differences between what a GPM will do at an established enterprise versus at a small startup.

Some companies have already defined the different roles and their functions within the product team, stress a growth mindset, and boast an infrastructure that prioritizes user data. Others have a small product team, view experimentation as risky, and lack necessary analytics tools, such as Amplitude or Mixpanel. When working for a company in the latter category, GPMs may need to build the case for additional resources by proving their value over time.

If the GPM has a team, it may include engineers, designers, marketers, and data scientists, and will work independently of other product teams. The team might focus on one particular phase of the funnel, such as acquisition or retention, or own the whole funnel.

The Future of Growth Product Management

In tracking and utilizing data to make evidence-based improvements, GPMs provide a vital link between user behavior and the ongoing product life cycle. Product-led businesses of all sizes and maturity levels stand to benefit from this soon-to-be-ubiquitous role.