I've always found it incredibly motivating to collaborate with expanding companies—helping them generate leads, drive sales, and, most importantly, watching them grow. It gives me a unique rush of adrenaline, and I believe I've found both a purpose and a direction in this process.

Fortunately, customer acquisition methodologies have evolved, finding new ways to connect with potential clients. We’ve all experienced the process of searching for a service provider—let’s say, a blacksmith to replace a door—and within an afternoon, thanks to feed suggestions, not only do we discover and compare multiple options, but we also quickly rule out the ones that aren't a good fit. The decision-making process mirrors real life—based on perceptions, validations, and interactions—only at a much faster pace.

As an agency, we understand that it’s not the same to speak to a customer who doesn’t even know what they don’t know, versus one who has a clear problem and is open to suggestions, or another who already knows all the available options and must choose between them. This is where acquisition strategies come into play, represented as a funnel aligned with the customer’s decision-making stages. Not to mention customers who buy again or recommend—we have different ways to engage each of them, just as in real life.

This approach has become the norm, but just when we think we've found the magic formula, we realize that the ideal world doesn't exist—users don’t always follow the steps we set for them. It’s like the Choose Your Own Adventure books we read as kids, except now the adventure unfolds in both the digital and real world, with users jumping back and forth unpredictably.

In other words, funnels are linear, but customer behavior is not. Customers don’t move forward in a straight path—they wander and backtrack. The gaming industry understands this well: a player might install a game on impulse, forget about it, and then return after an update. Growth loops or cycles capture this chaotic behavior, enabling compound growth.

Funnels operate in isolation, disconnecting each step and fragmenting the customer experience. This can hinder growth. A common example is when the marketing team generates leads and hands them off to sales without a smooth transition, causing potential customers to be lost along the way. Additionally, businesses can lose sight of the bigger picture, as each department focuses solely on its own goals rather than the overall success of the company.

A classic example we often see with our clients is paid advertising: an aggressive retargeting campaign might drive immediate sales, but if customers feel overwhelmed or harassed, they won’t return. Balancing conversions with the long-term health of the loop is crucial.

Funnels also struggle to adapt to market shifts. Take the rise of streaming services—traditional cable companies failed to pivot quickly, losing ground to more agile competitors. A loop-based approach, on the other hand, continuously monitors user behavior and market trends, making it easier to integrate new services seamlessly.

Lastly, retention is often overlooked in funnel-based strategies, overshadowed by acquisition. However, it is essential for sustainable growth—a mere 5% increase in customer retention can lead to a profit boost of up to 25%.

So, what do we do? Now that we understand the challenges of funnels, let’s define what a Growth Loop is.

For a Growth Loop to be created and successful, it must answer these key questions:

• Input: How is the loop activated? You need an action or a set of actions that connect the input to the output.
• Who: Who are the people involved in the loop? We must identify where free users, paying users, providers, and other stakeholders fit in.
• Why: What is the deep need, problem, or motivation that drives someone to activate the growth loop? If it’s not essential, the loop will lose momentum over time.

Let’s look at some famous examples to better understand how Growth Loops work:

1. Netflix – Personalized Recommendations Drive Streaming Growth

• Input: A user signs up after receiving a recommendation from a friend.
• Action: Streaming platforms use advanced algorithms to provide personalized recommendations, increasing retention and watch time.
• Output: Higher user retention leads to more people sharing the platform with friends and family, creating a continuous growth cycle.

As more data is collected, the accuracy of recommendations improves, benefiting both the platform and the users. Companies like Hulu and Amazon Prime have also strengthened their efforts in this area, following Netflix’s successful model.

This is a self-perpetuating Growth Loop, as it continuously improves with more data. And the best part? It relies on just one person: the viewer.

2. LinkedIn – Contact Integration

• Input: Users join LinkedIn to expand their professional network.
• Action: By connecting with existing contacts, new users enhance their own experience and that of others, fostering meaningful interactions.
• Output: LinkedIn encourages users to invite more connections, creating a continuous growth cycle.

This strategy has been a cornerstone of LinkedIn’s operating model for over two decades, helping the platform reach 1 billion monthly active users.

They have leveraged this Core Loop to become one of the longest-lasting social networks of all time, thriving from 2003 to the present day.

Growth loops are a key tool for driving sustainable growth in digital platforms, allowing each new user or business to generate further adoption within the ecosystem. Whether simple or complex, they create a win-win scenario for both supply and demand.

At Qm Digital Agency, we implemented this methodology with kamiPay, a digital payments fintech designed to facilitate transactions between businesses and Brazilian tourists. Our goal was to accelerate the adoption of kamiPay in key tourism sectors, including wine shops, travel agencies, restaurant chains, and long-tail businesses such as clothing stores, tire shops, supermarkets, and sports equipment retailers.

How we built the growth loop for kamiPay:

• Input: A business joins kamiPay to facilitate payments for Brazilian tourists.
• Action: kamiPay allows businesses to charge with zero commission and receive instant payment, unlike traditional credit cards. At the same time, Brazilian customers continue to pay using their usual payment method, Pix.
• Output: More businesses adopt it as a payment method, strengthening their presence in the tourism sector and increasing transaction volume, which, in turn, enhances the tourist experience and drives further adoption.

This approach enabled kamiPay to scale its adoption in key sectors, driving organic viral growth within the commercial ecosystem. Additionally, we reinforced the strategy with retargeting campaigns, optimization of new business acquisition, and sector-specific campaigns, ensuring sustained and scalable growth.

At Qm Digital Agency, we specialize in helping businesses unlock their growth potential through tailored digital strategies. From designing custom growth loops to optimizing paid media, content marketing, and conversion strategies, our team ensures that every action is crafted to boost engagement and drive long-term results.

If you're looking to accelerate your business with innovative digital growth strategies, reach out to us at Qm Digital Agency.