The Ultimate Guide on Viral Coefficient, Virality & Growth Hacking

  • by Naman Kapur January 29, 2016
    January 29, 2016

    How many times does it happen with you that you see a successful app and wonder what extra did it do to get so much publicity, traffic, word of mouth and downloads? How many times do you feel you are doing everything you can to promote and spread awareness about your mind-blowing and revolutionary app that people are missing out on due to small reach? How many times do you feel sorry for not being able to do justice to your app?

    The field you are missing out on is Viral Marketing.

    Growth Hacking The Ultimate Guide on Viral Coefficient, Virality & Growth Hacking

    Sure, you have heard of it, and sure, you think it is no big deal because it is the matter of luck—that it works for some apps but it is not going to work for you. Al Ries has rightly said, “What’s called luck is usually an outgrowth of successful communication.” There is never a factor of luck in marketing, the basic approach should not be to come up with a brand new marketing plan—because there isn’t any left—but to manipulate those that are already out there and being used by others. Viral Marketing or, more accurately called Growth Hacking is no rocket science, it is plain psychology. People view advertisement as an external mode of promotion, but when the same product is referred to them by someone they trust, they will blindly give it a try. From there, it depends on the capability of the product on how long will it be used or if that same friend is going to refer it someone else.

    To keep a track of this process, there is a mathematical method being used to check if the virality campaign is going steadily or declining—which, in turn, is going to help you plan your actions accordingly. How is it calculated? You may be aware of this already, I will just make it easier to understand below:

    Step 1: Suppose your app has 100 users currently

    Step 2: Assume each of your users is sending out 20 invites in their circle

    Step 3: Figure out the approx. percentage of the customers you are getting from these referrals. Let’s say it is 20%

    Step 4: So to summarize, your 100 users sent out 2000 invites through which you acquired 400 new users

    Step 5: Simply divide the new users by the initial number of users, ie, 400/100, that gives you your viral coefficient which, here, is 4. This is a repeated cycle, where newly acquired users will send out invites in their circle and so on…

    As self-explanatory as it is, the more the viral coefficient, the more users you acquire. Ideally, for any business or app to be always on a continual growth path the viral coefficient should not be below 1. Why, you ask? Because if you use the above calculation where you have the coefficient less than 1, you will realize sooner or later you will stop acquiring users through viral marketing and eventually you will end up spending your fortune on advertising which, in turn, is never cost effective and was the primary reason to focus on viral marketing in the first place.

    There are many growth hacks that are proven and popular, but the thing is, what works for X may not work for Y. Viral marketing keeps revamping itself frequently and you can never rely on a particular method to bring you new users every day. Furthermore it is a bit difficult to build an engine that lets you let your users to send out referrals and track the entire activity every time—it takes the focus away from your strategy and you end up spending your entire manpower and energy on the backend.

    So to be specific, there are two different problems:

    1. You are not using any growth hacking or viral marketing techniques in your app
    2. You are not able to build an engine that lets you try and test growth hacks in your app

    Let me suggest you to use any of the Growth Hacking Tools out there. What do they do?

    1. They allow you to configure virality campaigns to either all the users or to segmented users
    2. They give you the control to enable/disable campaigns at your own will
    3. They track all the activities, installs, shares and even influencers
    4. The most important—they prevent you from all the coding hassles

    So what should you do now? I’ll take the liberty to again push you to get started with any Marketing Automation tool and start growth hacking now, rest assured, new users will follow quickly!

    Originally published on ShepHertz Blog. Photo Credit: Pixabay, CC0 Public Domain

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