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Formula for Viral Growth

Formula for Viral Growth- Impact of formula on virality of business growth

From research, it is find out that huge success from start-ups is that you would be able to acquire more customers at low cost. In any business, according to business model Viral marketing formula is first thing to achieve any business goal. Hence viral growth is a major factor for objective achievement and only very few organization achieve it. Here is a “Formula for Viral Growth”- through you definitely would be able to achieve great success.

Key Factors and Formula for Viral Growth

viral growth formula

Let’s take an example of company Tabblo, According to Antonio Rodriguez he said that “I invested in a company (acquired by HP in 2007), and had the good fortune to work with an outstanding entrepreneur” . Tabblo tried its best to achieve success but at the same YouTube was launched and it did managed to achieve huge viral growth. So, with the examples of these two companies and many other we would be able to find out various virility factor. Let’s have deeper look on viral growth factors.

There is two key factors of viral growth: that drive the growth

  1. Viral Coefficient
  2. Viral Cycle Time

A viral growth examples are also mentioned is this article. These examples give you a look how does viral growth happens. Some of the people find it quite technical but it explains in detail you would be able to understand easily.

The Viral Coefficient (K)

Now let’s imagine you are starting a company and you have to build your customers by viral growth. You must have several friends, they can be your first customers, they have further their friends and friends of friends. Like that this chain continues. Now let have a look ” What is good viral coefficient and how to calculate it ”

Variable Name Description of a variableExample Value of a variable
Custs(0)Customers at initial level100
iNumber of Invitations sent out be each new customers15
conv%The percentage of invitations that convert into customers10%
KViral CoefficientK = i * conv%

You can calculate your viral coefficient by keeping above example:

  • Take the number of your current customers. Let’s say that’s 100.
  • Multiply this number by the number of invites your current customers send to their friends. If your business is online this will not be a problem. If it is offline you have some research to do to acquire the necessary stats. Let’s say you find that each customer invites 15 of his friends.
  • Find the percentage of those invites who become your new customers Let’s say that that’s 10%.
  • Then 100 of your the customers sent out 15 invites that will resulted in to 1500 invites. Then if 10 % of them became your new customers then that is 150 new customers.
  • You have started with 100 customers and you have now gained 150 extra customers. Divide the number of the new customers acquired by the number of existing customers and you have your viral coefficient. So in our case it will be 150/100 = 1.5

Measuring viral growth is that “The value of viral coefficient must be greater than one”. As soon as it will be less than one it stop increasing people after few. So we have to make K more then one. So then this formula work properly and growth increase.

Viral Cycle Time

The Viral Cycle Loop
Processes of Viral cycle- How customer proceed to your application and conversion rate increase.

Antonio Rodriguez has created Tabblo at the same time when YouTube launched, both were got successful but YouTube get more viral and increase their growth  more and more times than Tabblo. YouTube entertained the users on another level that no platform was able to do before. What was their strategy? How they appeared in this way.

For the answers of all these points we have to deep look on the factor ” Viral Cycle time”

Short Viral cycle time result in to explosive growth

In YouTube viral cycle time is very short. User used to come and see interesting videos than share link to their friends with out the headache of download files or any other fatigue

So one the other side, Tabblo had long viral cycle time like people have to share photos and invite their friends to like it and share their experience.

Now friend might like this site and share their photos, it took months people take photos and share. This was the problem where Tabblo were less viral than YouTube. If you have more cycles it is surety your growth will increase.

Have a  look at the formula shows the whole strategy. The Viral Coefficient K is raised to the power of t/ct, so less the value ct has a far more powerful effect than increasing K.

These two are formulas of viral growth, If you apply this on your business, It will give immense grwoth. From this article we conclude few points below

 

Conclusion

  • You have to make your viral coefficient 1 or greater than 1. Than you have a true viral success.
  • The most important and key factor is not viral coefficient but Viral Cycle Time. It should be very short than an immense and dramatic viral growth will be resulted.
  • Second factor that is important is viral coefficient, because invitations you sent ultimately result in to conversion rates, and it also effect on growth.

Moreover ,

  • Growth of viral marketing is not only done by marketing department; this is more than marketing strategy when product is in process these things need to kept in mind by Product developers and engineer. How product should be designed so that in future it goes viral.
  • Most of time product get viral that only work until you don’t share, like skype, WhatsApp, Viber, these products only work when next person also download it. So, product get viral
  • So , Make your viral cycle as short as possible and then improve viral coefficient by increasing conversion rate.It will give a DRAMATIC success.

 

About Tayyaba Awan

Tayyaba Awan is graduated engineer and passionate about latest news and innovations about technology. she love to read related content and come up with detail understanding and write it for you.

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