Viral loops
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Viral loops

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This is a presentation about the different kind of technology consumer products, where viral loops can fit in, and how to design an efficient viral loop.

This is a presentation about the different kind of technology consumer products, where viral loops can fit in, and how to design an efficient viral loop.

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Viral loops Viral loops Presentation Transcript

  • Value Loops, Viral Loops & NetworkAnurag Jain Effects
  • Structure of Talk• Value Loop• Network Effects• Viral Loops• Designing viral loops
  • Types of products• Inherent value or dependent on network effects?• Primary value => Inherent – even a single user can be a long-term user• Primary Value => network effects – No community => all users leave
  • Value loop• More value + less cost = value loop• Usually Word of Mouth• Typically takes a while• Concentrate on channels of distribution• E.g. - mint.com, google.com, early days of facebook
  • How do we measure value?• Net Promoter Score – Users rate from 1-10 – 10 = best – Promoters (9-10) – Passives (7-8) – Detractors (1-6)• NPS = % Promoters - % Detractors• High NPS (>40%) => No need for virality
  • Network Effects• 100 users or 10,000 ?
  • Network Effects• 100 users or 10,000 ?• It depends!!
  • Network Effects• 100 users or 10,000 ?• It depends!!• Imagine 10,000 facebook users with 0 friends each
  • Network Effects• 100 users or 10,000 ?• It depends!!• Imagine 10,000 facebook users with 0 friends each
  • Network Effects• Metcalfe’s law: Value of network = c(P^2)P – no of connected users• If n sets of connected users, Value = c(P1^2 + P2^2 + … + Pn^2)
  • Network Effects• Metcalfe’s law: Value of network = c(P^2)P – no of connected users• If n sets of connected users, Value = c(P1^2 + P2^2 + … + Pn^2)• E.g. facebook, linkedIn, twitter
  • Network Effects• Metcalfe’s law: Value of network = c(P^2)P – no of connected users• If n sets of connected users, Value = c(P1^2 + P2^2 + … + Pn^2)• E.g. facebook, linkedIn, twitter• Cold start problem
  • Social Layer?• Facebook -> People/People• Twitter -> People/News• Foursquare -> People/Places
  • Social Layer?• Facebook -> People/People• Twitter -> People/News• Foursquare -> People/Places• Your product -> People/????
  • Primary benefit• Why should I care?• What’s in it for me?
  • Primary benefit• Why should I care?• What’s in it for me?• Sharing?
  • Psychology of sharing• Facebook -> Socialite• Twitter -> In the know (journalist)• Yelp -> Critic• Quora -> Expert• Instagram -> Photographer• Foursquare -> Person-about-town
  • Psychology of sharing• Facebook -> Socialite• Twitter -> In the know (journalist)• Yelp -> Critic• Quora -> Expert• Instagram -> Photographer• Foursquare -> Person-about-town• Your product -> ?????
  • Friendship graphs• Symmetric or asymmetric?• Friend or follower?• Friend = more private• Follower = public, but higher growth – More specific to intent-based vertical networks
  • Building Network Effects• Critical Mass – community that sustains itself – 150 users in each community• Alpha Users – High Social Networking Potential (SNP)• Cold Start problem – If I have only a few friends, where is the value for me?
  • Building Network Effects• Social Learning – Watch what others are doing
  • Building Network Effects• Social Learning – Watch what others are doing• Singling Out – Messaging from others
  • Building Network Effects• Social Learning – Watch what others are doing• Singling Out – Messaging from others• Feedback – How does my network respond to my actions?
  • Building Network Effects• Social Learning – Watch what others are doing• Singling Out – Messaging from others• Feedback – How does my network respond to my actions?• Distribution – Extent of reach of my actions. Who all sees it?
  • Network Effect example• Credit for user @a all along the chain• More motivation to write funny/interesting tweets
  • Building Network Effects• Network Effects – Alpha users will help, but only for a while – Slow growth => death – Need viral growth
  • What is viral?• Anything that grows exponentially, like a virus
  • Why do we want viral growth?• It’s cheap (and fast)
  • What is Viral?• Anything that grows exponentially, like a virus• Word of Mouth propagation can be viral under certain circumstances
  • What is Viral?• Anything that grows exponentially, like a virus• Word of Mouth propagation can be viral under certain circumstances – But typically slow• How do we know when something is viral?
  • Viral Co-efficient• Let’s say each user invites 5 friends – on avg 22% of invitees register – viral co-eff => 22% * 5 = 1.1• > 1 = viral
  • Viral Co-efficient• Let’s say each user invites 5 friends – on avg 22% of invitees register – viral co-eff => 22% * 5 = 1.1• > 1 = viral• If 1 user gets 1 more, can get the entire world
  • Viral Cycle Time• If 1 user gets 1 more, can get the entire world• But, how fast?• Until market is exhausted, how fast does it grow? – Viral Cycle Time – Depends on each product• Measurement is important!!
  • Measuring Viral Cycle Time• Cohort Analysis• Weekly (or daily) cohorts of users• Track how users behave over period of time, based on when they joined• Idea: Don’t make decisions for new users based on metrics from more experienced ones
  • What parts are viral?• Invitations• Engagement• Trick is to invite other users as part of the core user experience• Not to be confused with network effects
  • What is the viral loop?• User A takes an action
  • What is the viral loop?• User A takes an action• User B is notified as part of that action
  • What is the viral loop?• User A takes an action• User B is notified as part of that action• As part of the response, user B takes SIMILAR action
  • What is the viral loop?• User A takes an action• User B is notified as part of that action• As part of the response, user B takes SIMILAR action• User B therefore invites User C
  • What is the viral loop?• User A takes an action• User B is notified as part of that action• As part of the response, user B takes SIMILAR action• User B therefore invites User C• … and so on
  • What is the viral loop?• User A takes an action• User B is notified as part of that action• As part of the response, user B takes SIMILAR action• User B therefore invites User C• … and so on• Integral part of the product, not a layer
  • Designing Viral Loops
  • Designing viral loops• Single core activity• Single entity for user to interact with• Can have multiple types of users, but with great difficulty• Channels for virality
  • Single activity• What is the core activity?• Can we add messaging to this activity?• The new user who sees this responds to this activity by taking the SAME action• … and so on
  • Single activity• What is the core activity?• Can we add messaging to this activity?• The new user who sees this responds to this activity by taking the SAME action• … and so on• Viral growth
  • Single type of user• Multiple sets of users – VERY HARD• Motivations are very different for different groups• E.g. Seller != Buyer
  • Single type of user• Multiple sets of users – VERY HARD• Motivations are very different for different groups• E.g. Seller != Buyer• Design loop for each set separately
  • Channels for being viral• News Feed• Notifications• Email• Profile• Invites• Non-user pages• Profile Actions
  • Other Techniques for Viral• Game Mechanics – Badges, scores, etc.• Not core value, unless game is the core itself• Rewards• Contests
  • Steps for viral loop• Design loop with core activity• Build product• Test on small set• Optimize the loop
  • Conclusion• Feature depends on network effects? – Cold start remedies• Need viral loop• Measure, measure, measure• World dominance