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The Science behindViral Marketing,[object Object],Lessons Learned,[object Object]
Explosive growth!,[object Object],YouTube,[object Object],Facebook,[object Object],Zynga,[object Object],Groupon,[object Object],Twitter,[object Object],Gilt Groupe,[object Object],All have set records for growth rates,[object Object],The key is Virality,[object Object]
The Power of Viral Marketing,[object Object],When it works it is Free!!,[object Object],Far more effective than paid promotions and advertising campaigns,[object Object],If done well can be self-sustaining + growth,[object Object],Unfortunately rarely achieved!,[object Object]
The Best Business Model,[object Object],Virally acquired customers are free,[object Object],Monetization(LTV),[object Object],Cost ofCustomerAcquisition(CoCA),[object Object]
Topics,[object Object],The Science behind Viral Marketing,[object Object],How to do Viral Marketing,[object Object],Optimizing for Virality,[object Object],Making this work for your business,[object Object],Examples,[object Object]
Where my experiences come from,[object Object],Tabblo,[object Object],Photosharing site,[object Object],Founded by Antonio Rodriguez, 2005,[object Object],Acquired by HP within 18 months,[object Object],Great investment return,[object Object],All credit is owed to Antonio Rodriguez,[object Object]
The Viral Loop,[object Object]
The Math behind Virality,[object Object],Key variables:,[object Object],Custs(0)	The initial set of customers,[object Object],i			The number of invites sent out,[object Object],conv%		The percentage of invites that				convert into customers,[object Object]
The Viral Coefficient,[object Object],K		The Viral Coefficient,[object Object],K = no of invites  x  The conversion %    (i x conv%),[object Object],Turns out to be a very important variable. It equals the number of new customers that each customer is able to successfully invite.,[object Object]
An Example,[object Object],Custs(0)		= 5,[object Object],i 			= 10,[object Object],conv% 		= 20%,[object Object],K			= 2,[object Object]
The Formula,[object Object],New custs added in this cycle =,[object Object],New custs added in the previous cycle    x     K,[object Object],Assumes that customers only send out invites once, and not continuously in every later cycle,[object Object],To calculate the number of customers at any particular cycle (c):,[object Object],Custs(c) = Custs(c-1) + NewCusts(c) ,[object Object]
Sensitivity to K,[object Object],See Spreadsheet model,[object Object]
Sensitivity to K,[object Object]
What we learned,[object Object],Viral Coefficient must be > 1,[object Object],to have viral growth,[object Object],Viral Growth is a compounding phenomenon,[object Object],Increasing the Viral Coefficient has a big impact on the rate of growth,[object Object]
YouTube versus Tabblo,[object Object],Both started around the same time,[object Object],YouTube’s growth massively outstripped Tabblo,[object Object],What was happening here?,[object Object]
Tabblo’s Viral Loop,[object Object],User discovered Tabblo,[object Object],Wait till they take some photos,[object Object],Upload,[object Object],Share (i.e. invite others),[object Object],Some portion of those think, this is great, I want to use this myself,[object Object],Wait till they take some photos,[object Object],Upload,[object Object],Etc.,[object Object]
YouTube’s Viral Loop,[object Object],User discovers YouTube,[object Object],Sees some hilariously funny content,[object Object],Decides to share that with friends,[object Object],Friends see hilariously funny content,[object Object],Decide to share that with their friends,[object Object],The time to infect is far shorter!,[object Object]
A More Sophisticated Formula,[object Object],t = timect = cycle time,[object Object],Thanks to Stan Reissfor help with the forumula,[object Object]
What this tells us,[object Object], Raised to the Power of …,[object Object],Multiplier,[object Object],Shortening the cycle time has a far bigger effect than changing Viral coefficient!,[object Object]
Some experiments,[object Object],See Spreadsheet model,[object Object]
Some Experiments,[object Object],Time - t,[object Object],No wonder YouTube was explosive!,[object Object]
Lesson Learned,[object Object],Reducing Viral Loop cycle time has by far and away the greatest effect on viral growth,[object Object]
How to do Viral Marketing,[object Object]
The Basics,[object Object],Figure out the Viral Hook,[object Object],What makes people want to share content?,[object Object],Content or Product/Service,[object Object],Initial Seeding,[object Object],Use communications networks to spread,[object Object],Email, Twitter, Facebook, Google+, etc.,[object Object],Refresh & Re-seed,[object Object]
Figure out the Viral Hook,[object Object],Something very compelling that the user wants to share,[object Object]
Viral Hook  -  What works:,[object Object],Something of Value:,[object Object],Applications,[object Object],Educational content,[object Object],Data,[object Object],Things of monetary value (Discounts and coupons),[object Object],Something entertaining,[object Object],Humor,[object Object],Games,[object Object],News,[object Object],Inherently Viral Services,[object Object],Email, Skype, etc.,[object Object],Other?,[object Object]
Why do people share?,[object Object],A paper on that here:,[object Object],http://marketing.wharton.upenn.edu/documents/research/Virality.pdf,[object Object],http://www.nytimes.com/2010/02/09/science/09tier.html (summary),[object Object],Virality driven by physiological arousal,[object Object],High arousal, Postive (awe) – most likely to be shared,[object Object],High arousal, Negative (anger or anxiety) – less likely,[object Object],Low arousal, de-activating (sadness) – unlikely,[object Object]
Content Types,[object Object],Blogs,[object Object],Videos,[object Object],eBooks,[object Object],Applications and Services,[object Object],Etc.,[object Object]
The Science behind Viral marketing
The Science behind Viral marketing
Using engineering for marketing,[object Object]
Inherently Viral Applications,[object Object],The most viral apps are those that are require sharing to work properly:,[object Object],HotMail,[object Object],Skype,[object Object],YouTube,[object Object],FaceBook,[object Object],Etc.,[object Object]
Initial Seeding,[object Object],The bigger your initial seeding the better,[object Object],Identify Influencers,[object Object],Reach / Influence,[object Object],Klout, SocMetrics and other services emerging to help,[object Object],Develop the right relationship,[object Object],Listen, Strategize, Engage, Measure,[object Object],Paid Seeding,[object Object],Paid search, Virool.com, etc. ,[object Object]
Spread through Communications Networks,[object Object],Early days this was email,[object Object],Social Networks have turbo-charged sharing,[object Object],What you want:,[object Object],Low effort for the user doing the sharing,[object Object]
Refreshing and Re-Seeding,[object Object],Google Search (paid and organic),[object Object],Creates new seeding,[object Object],New Blog posts,[object Object],Cause your existing readers to re-invite,[object Object],Farmville, etc.,[object Object],Continue to invite by regular posts to your wall,[object Object]
Lessons Learned Optimizing for Virality,[object Object]
Lessons Learned,[object Object],Apply my “Unblock your Sales Funnel” principles to the viral loop steps,[object Object]
GET INSIDE YOUR ,[object Object],CUSTOMER’S HEAD,[object Object],CONCERNS,[object Object],[object Object]
Find it offensive to give name and email
Don’t want to get spam sales emails
Worried that email address will be given to other marketers,[object Object]
Recommendation from a friend
Education
Data/ information reports
Entertainment
Free stuff
Meeting other people like me that have insights to share,[object Object]
Free trials address product viability and fit concerns
Lowest price guarantees,[object Object]
Example: Living Social,[object Object]
Another strategy,[object Object],Offer a reward both to the user and to their friend,[object Object],Overcomes the feeling of being sleazy,[object Object],Can lead to much higher success rates,[object Object]
Lessons Learned,[object Object],Maximize the number of invites they send out,[object Object],Leverage tools that provide easy reach to their friends:,[object Object],Twitter,[object Object],Facebook: post to their News Stream,[object Object],LinkedIn,[object Object],Automate access to their address book,[object Object],Works well for GMail, and other on-line address books,[object Object],Etc.,[object Object]
Lessons Learned,[object Object],Look for ways to automate the whole invitation process,[object Object],No thinking required,[object Object],No work required,[object Object]
The Science behind Viral marketing
Don’t just invite once,[object Object],Look for ways to keep repeating invites,[object Object],E.g. Facebook games like Farmville that post to your News Stream,[object Object]
Lessons Learned,[object Object],Look for other ways to get your customers to tell their friends about you,[object Object],Example: ConstantContact’s email signature,[object Object]

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