Viral Marketing Viral Marketing is cool Pass it on Revised

Viral Marketing Viral Marketing is cool; Pass it on! Revised July 2, 2008 – by Geoff Soumokil. Ever forward a funny email? Did that message contain any advertising? When individual consumers pass advertising messages to their friends, family and co-workers they are participating in viral marketing. Today, whole campaigns are designed to get the public to endorse products to their peers. Initially the impact of the message is limited, but by motivating readers to propagate the information, the campaign has the potential for exponential growth. History of viral marketing The term ‘Viral Marketing’ was originally coined by venture capitalist Steve Jurvetson in 1997 as a way of describing Hotmail's practice of adding a trailing message advertising themselves on outgoing mail from their email users. The assumption was that if such an advertisement reaches a "susceptible" user, he or she will become "infected" (i.e., sign up for an account) and can then go on to infect other susceptible users. As long as each infected user sends mail to more than one susceptible user on average (i.e., the basic reproductive rate is greater than one), standard results in epidemiology imply that the number of infected users will grow according to a logistic curve whose initial segment appears exponential. "Viral Fatigue", coined by Adam Salacuse of ALT TERRAIN in 2005, reflects waning consumer interest and lessening of pass-along rates of viral advertising content due to overexposure to the medium and the tactics involved. On and off the internet, such mechanisms are sometimes referred to as “creating a buzz” and accomplished through “word of mouth”. A sensational event or happenstance ignites consumer interest and friends telling friends results in overwhelming public response. Classic examples of viral marketing include the old fashioned "chain letter” that promises good luck for reproducing the text and mailing it to twenty friends. In the days before the internet such hand mailed correspondence had a very long life span and could circumnavigate the globe over the course of a few years… Now that same type of marketing is popular online. Why? Because it spans the globe in seconds and reaches exponentially more people in a shorter time. The history of online viral marketing begins at Hotmail.com. The free email service at Hotmail.com is the best example of an effective, non intrusive viral marketing scheme on the internet. Those who currently use hotmail as their email provider have of course noticed a message at the end of every dispatch advertising the service. Each time a subscriber sends out an email using Hotmail they are contributing to the public’s ever-growing knowledge of the business. The idea is so powerful; Yahoo copied the program six months later. Then the creative people at Amazon evolved viral marketing beyond simple link signature systems when they devised the first ever affiliate program on the internet. Amazon spawned hundreds of viral partners eager to promote the innovative company’s book sales to their own website visitors. Today, Amazon has more than 100,000 affiliates promoting their enterprise and gaining a small commission on each sale directed by them to their store. Affiliate and associate programs are now among the most popular viral marketing schemes employed on the web. Hundreds of small, medium and large companies are offering their programs to any willing partners looking to cross promote online goods and services. The connective ability of the internet can never be understated and grows everyday as every facet of society establishes a web presence. Previously established social networks have adapted to using the system to communicate, while many entirely new online communities have emerged. The majority of people’s friends and family are now online and almost all businesses are online. Internet access is spreading to cell phones and convergence devices like the blackberry, new cell phones, Mo-Dv, xBox, Sony PlayStations and Apple iPods. These new products expand the realm of the internet even farther - eventually it will impact every facet of modern life. Spread a cold, catch a customer A viral marketing campaign is an effective way to create awareness for business products and services. This can be accomplished in various ways. Three very different types are: - Pass-along A ‘pass-along’ system is a message which encourages the user to send the same message to others. The first example is the new and improved online chain letters where a message at the bottom of the e-mail compels the reader to forward it to friends. Devious examples are the ever-present fraudulent claims that ‘Bill Gates is spending his fortune!’ and will reward surfers with real cash if they forward the attached message to their entire address book. Reading the attached message will generally reveal a product or service being benignly advertised in the body of the text. Another effective weapon is humor. People willingly forward funny jokes and pictures. www.jibjab.com is a famous animated cartoon site - only by registering your name and email address in their database can surfers browse all the content available. http://www.metacafe.com offers many examples of viral marketing campaigns that have been created for the internet by ad firms around the world. - Incentivised viral This form of viral marketing offers rewards to consumers for providing someone else’s email address. Incentives can dramatically increase referrals. Online contests offer more chances of winning for each referral given; but when the recruit must also participate in order for the recruiter to profit, the chance that the referral participates is much greater. http://www.cadillacfairviewsecure.com/contest/ , Here’s a link to Cadillac Fairview’s online contest. - Camouflaged Ads This is viral messaging presented as art. A cool or unusual page, activity, or piece of news without obvious incitements to link or pass-along will excite in readers the desire to share with friends. Particular effort is made to make the discovery of the item seem spontaneous and informal, to encourage natural behavior. Currently in New York City a band of graffiti artists have formed an innovative company that uses spray painted pictures on buildings and walls to advertise product - their ‘camouflaged ads’ are similar in concept to the strategy of hiding messages in seemingly benign electronic information passed about online. Because of the large amount of unusual and entertaining content on the internet, this can be the hardest type of viral to spot, especially as companies try to imitate the style and content of amateur websites and authentic underground movements. http://www.subservientchicken.com/ is a funny site – it captures the user’s imagination and can provide endless hours of mindless entertainment. But after closer inspection savvy surfers may discover it’s a sensational marketing ploy to draw attention to Burger King’s new chicken strips. "Gossip marketing" messages create controversy by pushing the envelope. Online chat groups discussing the resulting controversy can be considered a buzz and even word of mouth advertising. Prior to releasing a movie, actors may be involved in what’s usually referred to as a publicity stunt. They deliberately create controversy that will direct the movie-going consumer’s conversational attention toward themselves and their project. One example is the ‘unofficial source’ that broke the news of the love affair between Tom Cruise and Katie Holmes before they released their movies, War of the Worlds and Batman Begins. Threats & Opportunities Let’s explore some concepts concerning the distribution methods different viral marketing schemes use to convey information. The modes of transmission are different for each medium: Word of Mouth is fairly easy to understand, anyone in a social network has experienced word of mouth transference of information. Word of Web transmission is an internet based form that converts the information on a page to an email. Often with an online article you will see a button asking if you want to send the article to a friend, the information is then transformed into an email. Word of Email. The majority of readers will have received a funny email from a friend and then forwarded it to another person or group of people. Every time email users forward emails they’re performing word of email. Word of IM (Instant messenger) is one of the fastest methods of sharing information, the link is sent instantly to a friend via servers such as MSN or Yahoo Messenger. Rewards for Referrals, refers to those marketing companies that offer rewards for referring customers. This transmission mode will be covered in more detail later. Caution! The following factors can work against the potential success of your viral marketing campaign. Size – if the viral content is a video clip or a streaming video, it may be too large for the recipient to receive. New technologies will eliminate this problem as internet connections grow faster and e-mail inboxes become more capable of receiving larger files. Media Format - a viral marketing campaign will be unsuccessful if the message is delivered in a strange incompatible format; for example if obscure software is required, people won’t be able to view the message. Email Attachments - many people receive viral marketing messages while at work in an office network and company anti-virus software or firewalls prevent potential audiences from receiving or viewing such attachments. Cumbersome Referral Mechanisms - for a viral marketing campaign to be successful, it must be easy to use. If the promotion is some sort of game or contest, then asking for referrals should be an option presented immediately after the game - not as a condition of play. Sabotage – in certain ‘camouflaged’ marketing campaigns, the discovery of covert advertising in the message (and the fact that it was disguised in the first place) may cause consumers to boycott the company or product. Before developing a viral marketing campaign Things to consider before developing your campaign 1. Brainstorm all possible user groups and social networks that might be interested in your products/services and develop strategies to include them in your endeavors. 2. Research how information spreads among your perspective customers. 3. Develop a clear and concise message that highlights your products/services in ways that benefit many different groups. 4. Think about ways to tap into subcultures and spread the word about your products/services in those niche markets. 5. Offer prospective customers an easy way to try your product/service before committing to payment. 6. Isolate special influential groups to whom you might offer discounts, loaners, and free samples. 7. Use ‘Sneak Previews’ to build anticipation and help create a buzz. Six elements of successful viral marketing 1. Give away product or services i.e. Cadillac Fairview currently has a contest for a $5000 shopping spree. Ballots are emailed out to those on their mailing list - they contain information about each mall owned by Cadillac Fairview across Canada. Another example would be the Abercrombie and Fitch website, which offers postcards that visitors can send to their friends and family, the postcard includes a link to the website - the recipient can easily click and go shopping at Abercrombie and Fitch. 2. Provide a method of effortless transfer - a referral button. In Cadillac Fairview’s contest, the ballot itself is very short and after the ballot is filled out by the applicant, the following page has a section where users can add friends, family and co-workers. The only effort required by the applicant is copying and pasting email addresses into the slots. 3. Scales easily from small to very large audiences - viral marketing can lead to unanticipated growth i.e. According to Buzz.com the average person has approximately 8-12 individuals in their social network. The server that’s receiving all of this information must be prepared to facilitate a large influx of entries. Growth patterns like this may lead to abrupt changes in strategic direction, which can create a lot of problems. 4. Exploits common motivations and behavior - Christmas is right around the corner, and many consumers feel cash poor immediately after the season. Our society however has always felt the need to have the latest material possessions. Logic suggests that January would be an excellent time to have a draw for a $5000 gift certificate. While everyone else suffers from the lack of funds, the winner can shop comfortably and this compelling idea could motivate a large public response to such a program. 5. Utilize existing communication networks - the Cadillac Fairview ballot is passed along via email, and according to recent findings the average individual has a network of approximately 8 to 12 people. Viral campaigns usually employ one of two forms of communication, physical word of mouth and communicating via the internet. 6. Takes advantage of existing resources - By advertising the contest on both company websites and local fashion magazines i.e. LouLou and Cadillac Fairview mall websites, i.e. Square One in Mississauga, Ontario they cross promote the event. The author also recommends having a section where frequenters can get an inside track on what’s happening in the world of the product. One marketing company found great success in using this for a star Trek collectors set - they would provide fan sites with a preview of products and upcoming promotions. The response was overwhelming. “Enthusiastic fan sites can be a tremendous boost for any brand. They generally enjoy much more street cred than the master brand. Advertising can take you lots of places but endorsement from what the online community views as “the experts,” is most powerful when it comes from this kind of environment.” Problems involved in viral marketing campaigns Viral Marketing is considered to be an art rather than a science - it doesn’t allow a lot of control, and you can't always track results. Advertisers have no way of knowing what the recipients did with their messages. In many cases it’s hard to tell if new customers found the business because of the viral marketing campaign, or through more conventional means. If done incorrectly, viral marketing breeds SPAM. In too many cases, individuals eager to make more money are motivated to spam the masses. This can be problematic for the client company image. Let’s consider a firm like AllAdvantage.com, which paid individuals to email their friends messages designed to convince them to buy the featured products. In this example one person sends a friend a personal email educating them on AllAdvantage’s great product/service, that friend will open the email because it’s personal and they trust the sender. If the same friend received an unsolicited email from someone he or she doesn’t know, or barely knows, it can weaken his or her relationship with the sender and reflect badly on the product or service being advertised. The email has lost its personal nature, which was vital to the success of AllAdvantage’s viral marketing campaign. The only method of trying to control the customer to customer communication by which viral marketers have seen promising results is by offering paid referrals – and that’s risky business. Making your viral work One way of ensuring the ‘worst case scenario’ doesn’t happen to your campaign is to spend more time than money doing market research, analysis and planning. Create proven incentives - trust your market research to generate options and pick the most realistic approach. Encourage each satisfied customer to advocate your business – In viral marketing its extra important to keep existing users happy to attract new client referrals. In a recent survey conducted in Europe, Taylor Nelson Sofres (TNS) found that: - More than 1/3 of the internet users interviewed voiced dissatisfaction with some part of their experience at an e-tailer's (shopping) site. - 37% percent of those questioned said they were unhappy or indifferent toward the regularity of updates at their most frequented sites. - 33% disapprove of, and avoid personalization features. - 32% are not satisfied with the quality of search tools, and the download speed. Overall, it really looks like there’s room for improvement and web designers of the future must face the challenge of rising consumer expectations. TNS also found that 98% of satisfied users said they’d recommend a site to someone they know, while only 1% of unsatisfied users would do the same. Its no surprise those referring the product are also satisfied customers, i.e. hair club for men, otherwise their advocacy may prove to have a negative effect on your viral campaign. Control Your Branding You don't know who’s going to be reading your message down the line and unless controlled your affiliates might start to modify the message. This leads to variability in how your brand is perceived. For this reason alone it’s important to set expectations with site owners and ensure their websites reflect the proper branding of your product. These findings came almost a year after ‘Jupiter Media Metrix’ found that only a few online marketers actually attempt to track the success of their viral marketing efforts. As a result, few etailers understand the significant contribution referrals play in their business. Consider as well, marketers have had a hard time trying to trigger the ‘pass along’ instinct and struggle harder and harder each year to create a campaign compelling enough to motivate consumers to share with their friends and family. Last Words Please take into consideration the more you try and control a viral campaign the smaller it becomes. Motivate users to promote your business by offering positive rewards. Build a customer base through good service, good products and trust. Whatever methods you use to promote your products, don’t violate the trust of customers you’ve already won (by selling their information). Having a loyal consumer base ensures success. Keep these questions in mind when designing your viral marketing campaign: Are your incentives large enough to attract wide spread interest in the program, or are they too big and will motivate cheat software, fraud, false registration and spamming? If running online contests, the prize should be relevant to your demographic and work with your company’s branding. Sony Corp for example, is already a very established name in the home electronics marketplace, and its worth noting that their viral campaigns offer cool prizes that reinforce their brand. Sony altered the cash reward of an existing college promotion by offering participants the chance at winning a dorm room full of dream electronics. This idea captured youthful imagination, and even though it was worth less than the cash prize, their response rates more than doubled. Consider also the college student that won the dorm room filled with Sony brand merchandise becomes an extra-ordinary advocate of all things Sony. Is the tactic used so aggressive the message gets lost in the mix? Bogging down potential consumers with spam and pop-ups only discourages them from learning more about your products – potential consumers are missing your message. Keep your campaign simple and beneficial for both you and your consumer. Is gaining new customers too high a priority? Will it affect the service enjoyed by your loyal clientele? If you can’t facilitate a rapid influx of consumers and your loyal consumers are having difficulty logging on to your site, or if quality of service is suffering, you may end up losing on both fronts. If your customer base increases rapidly, is your web server ready? Is your response staff ready? Is your budget ready? Looking for more resources? Set up a free consultation with one of our representatives, contact LCI at 416-408-4669, info@lifecaptureinc.com, or visit us at www.lifecaptureinc.com. Sources: http://en.wikipedia.org/wiki/Viral_marketing/ http://www.clickz.com/experts/archives/mkt/onl_mkt_comm/article.php/823941 http://en.wikipedia.org/wiki/Viral_marketinghttp://marketing.about.com/od/viralmarketing/a/createbuzz.htm http://www.clickz.com/experts/archives/mkt/onl_mkt_comm/article.php/821371 http://www.clickz.com/stats/sectors/advertising/article.php/1107471 http://www.clickz.com/experts/archives/media/plan_buy/article.php/836131 http://www.clickz.com/experts/ad/ad_tech/article.php/3513746 http://www.tnsglobal.com/