Build an Inherently Viral Mechanism into your Product
Objective: Acquire new users through a mechanism that enables existing users to bring them into your product without increasing your customer acquisition cost by any significant amount.
How: Virality is a term that gets banded around a LOT, and more often than not its meaning is largely misunderstood. The core benefit of having virality baked into your product is that you can scale up new user acquisition without increasing your customer acquisition costs (CAC).
There are very few channels where this is the case. Paid is the perfect example because for you to increase user acquisition from paid, you'll also need to increase CAC (more money spent = more users).
What you're aiming for with virality is for CAC to remain a constant while user acquisition increases. This is usually through an existing user being responsible for the acquisition of a new user.
One of the most famous success stories of virality within a product is with Dropbox. Dropbox built in a referral system that meant you'd receive an extra 500mb of storage once you'd referred a friend into Dropbox. Not only that, but the person you referred in also received an extra 500mb of free storage. The fact that both parties gained value from a referral dramatically increased the likelihood that existing users would invite in others.
Airbnb is another company that has a pretty good viral mechanism built into their product. They offer $100 in travel credit (to be spent on Airbnb) for every new Airbnb host that you invite and $35 in travel credit for every Airbnb traveler that you invite. The host that you invite also gets some Airbnb credit, which ensures that there is value for both parties.
Another really good example is with MailChimp. MailChimp allow you to use their email platform for free if you have less than 1,000 subscribers in your list. The other caveat is that you have to include a rewards bade at the end of your email. This means that anyone receiving your email will see a MailChimp signup link.
Not only does this help to acquire new users for MailChimp, but the user that refers in someone will receive reward points, helping them to discover new features and reducing their likelihood to churn.
Ultimately, virality is a hard thing to achieve. One of the things that you will want to do when you're scoping out the possibility of building in some kind of viral mechanism into your product is what the viral potential is. This is usually worked out as a viral coefficient.
While it's difficult to give a boilerplate "how-to" on adding virality to your product, here are some things you'll want to think about:
- What features of your product are most popular among your customer base?
- Do you have any features that have usage caps that could be increased through a referral incentive?
- By inviting others into your product, would your existing users benefit from any kind of network effect?
- What can you use as incentives to existing users to bring in new users that will have a minimal impact on CAC?