Science behind viral marketing

By December 7, 2006 December 8th, 2006 10 Comments

Viral marketing 2 

Viral marketing is a big topic in the web2.0 world and there is a lot of debate on whether you can force it or whether it is just something that happens to companies that get lucky.  I often talk about the importance of finding ‘a bit of magic marketing pixie dust’ that will really put a rocket under your traffic growth.

I think the evidence increasingly shows that whilst it is certainly not a science and there is no guaranteed formula for making it happen there are things you can do to maximise your chances of success.  This has been in the back of my mind since understanding how WAYN (a recent investment of ours) kickstarted it’s viral growth and the MySpace case study case study I read yesterday on the excellent Startup-Review firmed up my thinking to the point where I wanted to get it out there on a post and see what you all think.

I was pointed to Startup-Review by a couple of you last week when I said I was looking for a case study on turning traffic into cash.  Great site.  If you have an interest in what makes web2.0 start-ups successful you should check it out.  I have already emailed two links to other partners in my fund.

This is a quote from the MySpace case study:

If the two largest Web 2.0 successes (based on number of registered users) are Skype and MySpace, I think it is interesting to note that each benefited from having a major distribution partnership during launch…..While both Skype and MySpace were inherently viral products, they might not have reached such large scale in such a short period of time without that initial impulse function from distribution channels.

The distribution partner for Skype was Kazaa and MySpace leveraged Intermix’s (MySpace parent company) media buying and channel relationships.

As Startup-review points out, this kind of traditional partner based marketing runs a bit counter to many web2.0 ideas of zero cost viral marketing.  The insight here is the trick of getting your site started by finding the distribution that will get you to the critical mass point after which true zero cost viral marketing can work rapidly for you.  If you pay a little for that it could be worth it.  Distribution, Distribution, Distribution.

Also interesting is that MySpace had two failed initiatives at driving growth before the third successful one.

The importance of PR (traditional offline media as well as parties and blogs) shouldn’t be underestimated either.

All of this will cost a little money.

As I mentioned, WAYN had a similar start using CPA based advertising to attract initial members to the site and working the press extensively.   Clearly they haven’t had quite the success of MySpace and Skype yet…..

As an aside, using the blogosphere and web world to drive traffic is getting harder.  This post from Peter Rip describes how the blogosphere increasingly needs to be thought in the same way as a traditional channel, and this post from Greg Linden describes how using Digg is getting more difficult.  Both these developments are symptoms of a maturing channel.  The web world is getting more crowded.