Growth Loop
A self-reinforcing system where the output of one step becomes the input for the next, creating compounding growth over time.
Definition
A growth loop is a closed system where each cycle generates outputs that feed back into the system as inputs, creating compounding growth. Unlike traditional marketing funnels that have a clear start and end, growth loops are circular — each new user, piece of content, or data point makes the system more effective for acquiring the next.
There are several types of growth loops including viral loops (users invite other users), content loops (user-generated content attracts new users), and data loops (more users create better data that improves the product).
Why It Matters
Growth loops are fundamentally more sustainable than linear funnels because they compound over time rather than requiring proportional increases in spending to grow. A well-designed growth loop means that as your business grows, acquisition becomes easier and more efficient rather than harder and more expensive.
Understanding growth loops helps marketers identify which activities create these self-reinforcing cycles and invest accordingly, rather than spreading budget across disconnected tactics.
Examples in Practice
A review platform demonstrates a content growth loop: more reviews attract more visitors via search, more visitors leave more reviews, which attract even more visitors — each cycle strengthens the next.
A SaaS tool where users create shareable reports — each report includes "Created with [Tool]" branding, driving new signups who create more branded reports.
A referral program where each new customer receives credits for inviting friends, and those friends receive credits for inviting their friends, creating an expanding viral loop.