The difference between Viral Marketing and Viral Business Models

It's every marketer's dream to "go viral".

However, "viral" can mean two quite different things.

Viral marketing

The first meaning of "viral" is probably the most familiar as it has been around longer. Viral marketing refers to a marketing message which spreads within a community under their own volition (as opposed to one which must be broadcast by its sponsor).

viral marketing: A technique aiming at reproducing "word of mouth", usually on the internet or by e-mail, for humorous, political or marketing purposes.

Some recent examples include:

Samsung's Extreme LED Sheep Art video: disconcertingly mesmerising, your guard will be down before the subtle product push appears right at the end.
CompareTheMarket.com's CompareTheMeerkat.com: so subtle that many people I've spoken to had not realised it was a CompareTheMarket.com add despite the CompareTheMarket.com name, logo and URL appearing at every conceivable opportunity.
The Large Hadron Rap: a brilliant effort to make something extremely complicated, buried underground and with the potential to destroy the entire universe both understandable and cool.

The objectives of viral mareting are simple:

to increase awareness,
at a lower cost (certainly much lower than a conventional above-the-line advertising campaign),
to have some of the campaign attributes ("coolness", innovation, etc.) rub off on the brand (although P.T. Barnum supposedly suggested that "There's no such thing as bad publicity", a viral marketing campaign must surely aim for "good" publicity!), and
to get customers involved in spreading the message themselves, which subconsciously increases their comitment to the brand.

Dan and Chip Heath have outlined their three secrets to make a message go viral. To summarise, these are:

it's emotional,
it feels like you're doing someone a favour by passing it on, and
if contains a trigger to pass it on.

Viral business models

Whereas in viral marketing, it is only the marketing message that is viral, viral business models exhibit viral growth as an inherent part of the business model. That is, as a part of their normal interaction with the business, its customers publicise the business to others and/or invite them to become customers themselves.

Examples of viral business models include:

Social Networking sites, such as Facebook, LinkedIn, and Twitter: There is no little to membership unless you friends or business contacts are also members, so each member is highly incentivised to encourage others to join. Further, once most of your friends or business contacts are members, you're undera lot of pressure to join up or risk being "left out".
Remote multi-player games and consoles: As with social networking sites, there is pressure to buy the same games and console that your friends have so that you can play along with them.
Peer Review sites, such as Amazon.com or Amazon.co.uk: These are similar to Social Networking sites, in that the more members there are (and are rating and reviewing the product), the more value each member gets. However, since you don't need to have any relationship to the other members, there is less incentive for you to sign them up - you simply gravitate to the site with the most existing and active members.
Multi-level marketing (MLM) or Network Marketing businesses: Not always popular and sometimes bordering on being pyramid and/or Ponzi schemes MLMs succeed by incentivising their members to recruitmore members.
Services that advertise themself when their customers use them to share their own content, such as free e-mail providers (gmail.com), blog hosts (blogger.com - visible at the top of this blog post), content sharing sites (youtube.com - used a few times in this post; and vimeo.com - also used in this post) all of which advertise themselves in their URLs if not more overtly.

In his review of Product Planner, Jason Kincaid suggests that the key to creating a viral business model is to create a circular process where by each activity in the cycle involves promoting to or inviting additional users. This process can be the member enrolment process itself, but its even better another process, such as the video embed loop at Vimeo, as the customer will have multiple opportunities to publicise the business and/or invite new members as their familiarity with and confidence in it increases (people are more likely to want to recomment something with which they are familiar than something which is still new to them).

Viral busines models tend have "tipping points" - points at which the adoption rates change markedly. These can be hard to predict. For example, in we were so wrong about Twitter, Rob Diana, suggests that one of the tipping points for Twitter was the adoption by celebrities such as Ashton Kutcher, Britney Spears and Oprah.

The difference between these two meanings of "viral" is significant in its application to businesses. Any business can create a viral marketing campaign. All you need is a sufficiently talented creative team (how about the viral factory and their wikipedia page), and, perhaps, a bit of luck. (That is not to imply that it is easy!) However, a viral business model needs to be built into a new business from the outset, or will require significant business re-engineering to implement into an existing business. I'd hesitate to say anything is impossible, but some existing businesses simply won't lend themselves to viral busines models.

10 Secrets for creating Viral Content
Top 10 Viral Videos (a list published by the BBC in 2006 - note: not all of them are marketing)
Mashables top 10 Viral Videos of 2009

How benchmarking success can lead to failure

A rich man decided to go on sabbatical. He called is three employees together, gave them each custody of a third of his wealth and explained that he would be back in a year.

The first employee went to the casino and bet everything on red. The second employee followed him to the casino and bet everything on black. The roulette wheel spun, and the first employee lost everything whilst the second doubled his money.

In the meantime, the third employee carefully vetted potential projects, monitored their progress, and worked hard to ensure the delivered results.

At the end of the year, the rich man returned and asked each of his employees how they had got on.

The first employee explained that he had unfortunately lost all of the money entrusted to him. The rich man fired him on the spot.

The second employee explained that he had doubled the money entrusted to him. The rich man was ecstatic. He immediately promoted the second employee, making him his most trusted advisor, and said that he would make no future decisions without first consulting him. He berated the first employee for not being more like the second.

The third employee explained that he had earned a respectable 15% return on his investments. The rich man was unimpressed. He told him he could keep his existing job, but that from then on he would report through the second employee, and would have to do everything that the second employee told him to do.

Our society idolises success. Often at the expense of understanding what causes it. We often fail to analyse when it is driven by "common causes" (hard work, discipline, etc.) and when it is driven by "special causes" (good luck, etc.). We try to emulate the outcomes of success without understanding inputs. We look for quick and easy solutions to complex problems. We fail to account for survivorship bias in our analysis of the results.

A university professor of mine once described a piece of research he'd done where he'd analysed which companies had used which methodologies (balanced scorecard, six sigma, lean manufacturing, etc.) to see if the methodology used could be correlated to their success. He concluded that it could not. However, he noted that some companies seemed to be successful with any methodology they used, whereas other companies seemed less successful regardless of which methodologies they used. He concluded that some companies were simply more deligent, disciplined and better at executing than others.

You will probably recognise that the story above is (quite heavily) adapted from the Bible (if you can recall the reference, please post it in the comments). A better analogy would probably be to the story of the hare and the tortoise.

We need to stop celebrating the few brilliant successes, and start understanding the many, ongoing, regular, repeatable, less glamorous successes. It may not make for attention grabbing headlines, or be easily reduced to 140 characters, but in the long run, it will deliver the results that we need.

My favourite bookmarklets

Bookmarklets are the quickest way to turn a passive browsing experience into an active browsing experience.

Here are my favourite and most useful bookmarklets:

bit.ly - converts the current URL into a TinyURL and prepares a tweet with the bit.ly URL and the page title (note: bit.ly also tracks who clicks on the link)
bit.ly Amazon Affiliate Link - creates an Amazon affiliate link of the current Amazon page
GMail this - prepares a GMail message with the current URL
Google -searches for the currntly selected text in Google
→Anglais - select some text and have it translated from French to English
→ Show all feeds - finds all feeds on the page and allows you to add them to Google Reader
Pin It - to Pinterest
Read Later - using Instapaper

Simply drag any that take your fancy onto your bookmarks bar.

Some other bookmarklets must be installed - just click on the link below and follow the instructions:

Evernote Clipper - Clip web pages to Evernote.

Why banning Facebook could be bad for business

Many organisations still insist on banning access to Facebook at the office. Here's why that makes no sense:

The reason companies give is usually that Facbook is a potential timewaster. However, banning Facbook won't stop bored employees from wasting time. I've worked in an organisation that banned Facebook even as its staff read "Hello" magazine at their desks. The onlyway to stop saff wasting time is to give them interesting work that keeps them engaged and motivated. The fact is, it's easier to ban Facebook than it is to stop staff reading "Hello" magazine or to give them interesting work that keeps them engaged and motivated. So companies ban Facebook in order to be seen to be taking taking decisive action against grafters. But no-one will be impressed.
If staff can't access Facebook on their computers, they'll simply do it on their cell phones. And that's bound to be slower and so take more time.
Sooner or later (if not already) the best and brightest staff will start to avoid the sorts of companies that implement such antiquated, restrictive and futile policies. Graham Jones writes that social networking is increasingly a part of how people think about the world - soon, they'll expect to find access to it in place in the same that way we now exect the telephone and e-mail to be in place (and to allow a certain, albeit limited, personal use). Companies that ban Facebook will be seen as punishing the creative and innovative,whilst failing to address the underlying problems of the unengaged and underperforming. So you'll get fewer stars, and more staff reading "Hello" magazine at their desks. (You may think this is not an issue in the current economic environment, but people won't just forget when the economy turns, and companies won't learn fast enough.)
And don't be fooled into thinking that Facebook is just about teenagers, Facebook is growing fastest in the core employment ages.

So, instead of banning Facebook, you could use and channel it within your business:

Encourage your staff to build networks and reslationships with suppliers, customers and competitors. And find ways to leverage those relationships.
Your staff could be your best advocates, and achieve more than your conventional marketing initiatives.
Your staff can use those networks to stay up to date with what is happening in your industry. It'll be cheaper and more effective than conventional training.
Your staff can get closer to your customers - learning what they think about your products and services and how they us them, and collaborating with them on ways to improve them.
And finally, if all of the above is not enough, according to the University of Melbourne, employees who use Facebook and watch YouTube are more productive than those that don't.

If a company has problems, banning Facebook will not solve them. Your staff can either use Facebook to evangelise your company / product during office hours, or criticise it from the privacy of their own homes. Either way, they will speak and be heard by their peers. You can influence which it will be.
Of course, I've used Facebook purely as one popular example of social media. The same logic could be applied to Twitter, Digg, SocialMedian, and a host of other services. If you're not up to date on what these are and how they are or could be being used within your company, its time to catch up.

Privacy Statement

We use third-party advertising companies to serve ads when you visit our website. These companies may use information (not including your name, address, email address or telephone number) about your visits to this and other websites in order to provide advertisements about goods and services of interest to you. If you would like more information about this practice and would like to know your options in relation to·not having this information used by these companies, click here
This website uses Google Analytics, a web analytics service provided by Google, Inc. ("Google"). Google Analytics uses "cookies", which are text files placed on your computer, to help the website analyze how users use the site. The information generated by the cookie about your use of the website (including your IP address) will be transmitted to and stored by Google on servers in the United States . Google will use this information for the purpose of evaluating your use of the website, compiling reports on website activity for website operators and providing other services relating to website activity and internet usage. Google may also transfer this information to third parties where required to do so by law, or where such third parties process the information on Google's behalf. Google will not associate your IP address with any other data held by Google. You may refuse the use of cookies by selecting the appropriate settings on your browser, however please note that if you do this you may not be able to use the full functionality of this website. By using this website, you consent to the processing of data about you by Google in the manner and for the purposes set out above.
Strategic Coffee is a participant in the Amazon Europe S.à r.l. Associates Programme, an affiliate advertising programme designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.co.uk.