1. Viral Marketing: Starting an Online Word-of-Mouth Epidemic Stephan Spencer President, Internet Concepts sspencer@netconcepts.com www.netconcepts.com

2. The Problem: Data Smog Not only are you competing with your competitors for their eyeballs and their loyalty, but also the information glut that fills the Internet and everyone’s lives. Hear the NPR interview of David Shenk, author of “Data Smog: Surviving the Information Glut” at

3. Just Say No! Interruption marketing just doesn’t work anymore –Unanticipated, impersonal, and irrelevant ads won’t break through the data smog Stop marketing at people. Get out of the way and let people market your products to each other.

4. The Solution: Viral Marketing Putting together the right offer Who’s going to spread your message? Making it easy…(email & web) Potential traps and hazards Best and worst practices Case studies

5. What is viral marketing? Word of mouth marketing augmented by digital communication Facilitate the process of people referring their friends and colleagues –to purchase your products, visit your site, sign up for a free trial, subscribe to your newsletter, etc.

6. Word-of-Mouth on Steroids Traditional WOM –Travels slowly –Dies off –E.g. recommend a book to some friends Digitally augmented WOM –Spreads fast –Travels far –Exponential growth (amplification) –E.g. Hotmail

7. Some New Jargon Sneezer, ideavirus, vector, hive, tipping point, connector, maven, promiscuous, powerful, smooth, amplifier, persistence, word-of-mouse, network effect, Law of the Few, Zipf’s Law, Metcalf’s Law, compounding effect, etc. Gotta love buzzwords!

8. Putting together the right offer Is your idea virusworthy? Ideaviruses love a vacuum

9. Who’s going to spread your message? Seth Godin calls them “sneezers” –“Promiscuous sneezers” - have their price –“Powerful sneezers” - can’t be bought; difficult to predict what will motivate them Malcolm Gladwell breaks them out differently –“Connectors” - masters of the ‘loose tie,’ seem to know everybody –“Mavens” - genuinely helpful –“Salespeople” - born to sell

10. Divide and conquer Go after a demographic or psychographic group where your ‘ideavirus’ can dominate Like people hang out together (e.g. the affluent mix in the same circles) Target those sympathetic to your cause –BMW dealership - don’t target Ford owners

11. Observe who’s sneezing! Identify your top sneezers by tracking ratio of “unique opens” for each message sent –0 = didn’t open –1 = recipient opened but didn’t forward –2+ = recipient probably forwarded (unless they check mail from multiple PCs) Reward and incent these sneezers! They’re worth their weight in gold.

12. Rewarding your ‘sneezers’ Don’t insist that a referrer’s friend become a customer to earn the incentive. That’s outside his/her control. Make sure the incentive is relevant to the recipient. It doesn’t have to be expensive. e.g. golf balls with the recipient’s name printed on them DON’T change the rules mid-campaign

13. Gotta give to get Don’t just give a speech and leave –Fly in your customers to tell their stories –Sponsor a cocktail party afterward Don’t just tell them how your product is safe and secure; give them a first aid kit for their car 3M Post-It Notes: –Secretary of 3M’s chairman sent a free case to secretaries of chairmen of the Fortune 500 MCI Mail: – Blew it - built friction into the system by charging instead of giving it away to build critical mass

14. Network Effect Metcalf’s Law - the value of a network increases with the square of the number of people using it A world with 1000 fax machines is 250,000 times better than one with only 2

15. Power of bestseller lists Zipf’s Law - #1 is MUCH more popular than #2 Stanford study: artificially boosting bestseller status of downloaded files Self fulfilling prophecy If you can’t dominate one, create your own

16. Make it easy for people to “pass it on” Ask recipients to forward your e-newsletter, email, or SMS message to friends Include on your site “Email this page to a friend” buttons to refer your articles, products, etc. Make it a fill-in form that allows the visitor to pass it on to a number of people at once –e.g. Ideavirus.com’s “Send It” page

17. Soft sell Not a blatant, in-your-face demand but an informal invitation Should not smack of commercialism or spam e.g. a blank postcard with a funny cartoon referencing the book and its topic

18. The customer is in control Of the content Of the frequency Of the relationship

19. Success stories Hotmail HOTorNOT.com Quixtar Unleashing the Ideavirus Blue Mountain Arts Google SETI@home Budweiser parody Absolut Gaming company Etc.

20. Hotmail Appended a small plug to every outgoing email: “Get Your Private, Free Email at http://www.hotmail.com” Founded in 1996. By Summer 1998, had 25 million active accounts Signs up over 150,000 subscribers per day, each of them profiles themselves upon registering Founder (Sabeer Bhatia) sold to Microsoft for $500 million Sabeer invented the term “viral marketing”

21. HOTorNOT.com Formerly AmIHotorNot.com View photos of strangers and rate their looks from 1 to 10 or post your own photo Launched by 2 unemployed Californians on a whim and with no funding A MediaMetrix Top 50 most visited site Peaked at 14.8 million page views in a single day

22. Quixtar Amway e-commerce site Distributor hands out a business card with their referral code, required to log in to the site MLM

23. “Unleashing the Ideavirus” Book by Seth Godin - in paperback, hardcover, and e- book format Free to download from the web at www.ideavirus.com Web site also allows you to easily email it to all your friends Most downloaded e-book in history An Amazon.com best seller

24. Blue Mountain Arts Online greeting card site (bluemountain.com) Sender chooses an e-card on the site, site then sends an email to the recipient prompting them to click on the link to pick up the card Recipient is encouraged to send their own e- card

25. Google Now the most popular search engine on the planet Came out of nowhere to dethrone the incumbents Spent no money on advertising A great service - most relevant results, fastest, and most complete

26. SETI@home Search for Extra Terrestrial Intelligence Analyzing noise from space More than 2 million PCs crunching numbers in their spare time, for no compensation Propagated by ‘powerful sneezers’ Persistent

27. Budweiser Parody “Wassup Superfriends” Budweiser, wisely, didn’t interfere Further burned Budweiser’s brand and ad campaign into our subconscious

28. Absolut Planted attractive women as paid sneezers at bars When men asked to buy them a drink: “Absolut gin & tonic” After a while, everyone was ordering Absolut gin & tonics Imagine now paying the bar to post a bestselling drinks list, then it becomes persistent!

29. Handheld video game maker Gave them away to the ‘popular kids’ On the condition that they play with them on the schoolyard

30. More examples ICQ Ebay Paypal Vindigo Napster Hamsterdance

31. Ready, Aim, Misfire. Southwest - negative WOM spreading like wildfire SMEI Auckland free CD campaign - lukewarm results Amazon.com email campaign - signed “Big Bird, King of the World, Amazon.com” Email marketer’s newsletter - “Ream more”

32. Southwest Airlines

33. SMEI Auckland Incentive for referring workshop registrant leads: a free CD on “Guerrilla Selling” Auckland chapter’s first experiment with viral marketing was a non-starter Why? –Uncompelling incentive? Non-virusworthy product being pitched? Poorly presented? Wrong target audience? Had good tracking of referral sources (both partners and individual sneezers) www.smei.co.nz/freecd.php

34. In Summary Viral marketing dwarfs traditional WOM Identify your best sneezers Make a compelling offering and exploit the sneezers’ motivations Make it easy to spread (“smooth”) You can influence, but not control

35. Further Reading Unleashing the Ideavirus by Seth Godin The Tipping Point by Malcolm Gladwell www.digitrends.net/marketing/13640_10856.html www.cbi.cgey.com/journal/issue6/unleashIdea.html www.webdevelopersjournal.com/articles/site_promotion /sticky_viral_site.html www.wellsfargo.com/biz/products/resources/advisor/arc hives/08viral/07viral.jhtml