2011 07 Tales of Virality—OSCON
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2011 07 Tales of Virality—OSCON

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ome companies are born lucky, and some companies have to make their luck. If your business unfortunately falls into the latter category, the way you make your luck in the Web 2.0 world is through......

ome companies are born lucky, and some companies have to make their luck. If your business unfortunately falls into the latter category, the way you make your luck in the Web 2.0 world is through virality. It’s a simple concept: a tiny bit of math, a lot of experimentation, and almost no common sense. Using experiences at three startups, Terry will explain what viral tuning is and how it is done. Learn how mushy business terminology like “hockey stick” and “viral marketing” meets the hard programming reality of building it on your LAMP website.

http://www.oscon.com/oscon2011/public/schedule/detail/18892

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  • Abstract:\nSome companies are born lucky, and some companies have to make their luck. If your business unfortunately falls into the latter category, the way you make your luck in the Web 2.0 world is through virality. It’s a simple concept: a tiny bit of math, a lot of experimentation, and almost no common sense. Using experiences at three startups, Terry will explain what viral tuning is and how it is done. Learn how mushy business terminology like “hockey stick” and “viral marketing” meets the hard programming reality of building it on your LAMP website.\n\n
  • First a warning, I’m not a business guy, I’m an engineer, and a scientist by traning. I don’t know why the powers-that-be at O’Reilly decided this topic would be good for the business track, but let’s see what we can do…\n\nImage: http://getweird.info/pics/sex-can-wait/\n
  • From 2004 to 2006 I worked at Plaxo as their first Web Application Engineer, you might remember them as the company that automatically update your address book, or you might remember them as the company that spammed everyone in your Outlook address, In either case, Plaxo is widely regarded as one of the first companies to SYSTEMITIZE virality via “viral tuning” which we’ll explain later.\n
  • Those years mark the time the first “Plaxo is Spam” blog posts came up to just before they got bought out by COMCAST where they are today.\n…\nAhh yes, there is a TechCrunch article about us. I can remember when Michael Arrington was bitching about us on Robert Scoble’s blog, before even created that website.\n…\nNice to see that my blog, shortly after I left the company, is still in the top 10 search results for “Plaxo Spam.”\n
  • Those years mark the time the first “Plaxo is Spam” blog posts came up to just before they got bought out by COMCAST where they are today.\n…\nAhh yes, there is a TechCrunch article about us. I can remember when Michael Arrington was bitching about us on Robert Scoble’s blog, before even created that website.\n…\nNice to see that my blog, shortly after I left the company, is still in the top 10 search results for “Plaxo Spam.”\n
  • …one of the founders of Plaxo was a co-founder of Napster who was booted out by the VC and went to the East Coast to party, he came back with a little known Harvard company you might have heard of. At Plaxo we would often play ultimate frisbee with a couple guys who were making MySpace widgets. They were introduced, via ultimate, to Sequioa Venture Capital and created this company.\n
  • …one of the founders of Plaxo was a co-founder of Napster who was booted out by the VC and went to the East Coast to party, he came back with a little known Harvard company you might have heard of. At Plaxo we would often play ultimate frisbee with a couple guys who were making MySpace widgets. They were introduced, via ultimate, to Sequioa Venture Capital and created this company.\n
  • From 2007 to 2009, I was hired as the Software Architect by TAGGED. Besides being one of the only people I know to be successfully prosecuted under CANSPAM, the pair that hired me stumbled independently on “viral tuning” when they were Physics majors at Harvard and were making an e-mail dating site. You know, you get an e-mail that someone is interested in you…. In any case those two years they went from 15 million to 250 million users, and about 20 million page views per day to over 250 million (7 billion monthly page views). Even the first 15 million users were viral, of course.\n
  • The founders of these two companies were on our Board of Advisors. One of them, started played second fiddle to Plaxo for years. But after they figured out viral tuning later, they embraced social networking. I think they went IPO recently…\n
  • Our inspirations… The founder of one was my next door neighbor until we both moved this year. The founder of the other was a classmate at Caltech.\n
  • Around the time Facebook released their Applications API at f8 in 2007, viral tuning became commonplace. More companies made their presence felt around this time.\n\nNow you may wondering what the line is for?\n
  • In 2009, over lunch one time withmy friend Matt, he offered me a job at his company, Automattic. Matt likes to say he is “unlucky at cards.”… and apt analogy\n\nSource: http://ma.tt/\n
  • A former CEO once said, “Some companies are born lucky, and some companies have to make their luck.” Companies like Hotmail, Facebook, and WordPress were “born lucky” and companies like Plaxo, LinkedIn, Tagged, Zynga make their luck. I'll explain what this means later, but this is the meaning behind the line.\n\nOh yeah, Automattic? We’re the company behind the blogging software, WordPress, that apparently powers 12% of the domains on the internet. Since the last two companies I worked for were Tagged and Plaxo, when people ask me why I went to work at Automattic, I tell them, “I’m tired of working for evil. I decided to give good a shot.” (Just remember the line is between born lucky and not, not good and evil.)\n\nSource: http://www.marieclaire.com/cm/marieclaire/images/poker_hand.jpg\nhttp://whovotedhow.com/wp-content/uploads/2009/10/card_up_sleeve.jpg\n\n
  • A former CEO once said, “Some companies are born lucky, and some companies have to make their luck.” Companies like Hotmail, Facebook, and WordPress were “born lucky” and companies like Plaxo, LinkedIn, Tagged, Zynga make their luck. I'll explain what this means later, but this is the meaning behind the line.\n\nOh yeah, Automattic? We’re the company behind the blogging software, WordPress, that apparently powers 12% of the domains on the internet. Since the last two companies I worked for were Tagged and Plaxo, when people ask me why I went to work at Automattic, I tell them, “I’m tired of working for evil. I decided to give good a shot.” (Just remember the line is between born lucky and not, not good and evil.)\n\nSource: http://www.marieclaire.com/cm/marieclaire/images/poker_hand.jpg\nhttp://whovotedhow.com/wp-content/uploads/2009/10/card_up_sleeve.jpg\n\n
  • A former CEO once said, “Some companies are born lucky, and some companies have to make their luck.” Companies like Hotmail, Facebook, and WordPress were “born lucky” and companies like Plaxo, LinkedIn, Tagged, Zynga make their luck. I'll explain what this means later, but this is the meaning behind the line.\n\nOh yeah, Automattic? We’re the company behind the blogging software, WordPress, that apparently powers 12% of the domains on the internet. Since the last two companies I worked for were Tagged and Plaxo, when people ask me why I went to work at Automattic, I tell them, “I’m tired of working for evil. I decided to give good a shot.” (Just remember the line is between born lucky and not, not good and evil.)\n\nSource: http://www.marieclaire.com/cm/marieclaire/images/poker_hand.jpg\nhttp://whovotedhow.com/wp-content/uploads/2009/10/card_up_sleeve.jpg\n\n
  • But first let's recall the days before the internet. In those days you first built a better mousetrap…\n\nSource: http://ontopinternetmarketing.com/wp-content/uploads/2010/09/mousetrap.jpg\n
  • then people beat a path to your door, and then you used marketing to protect that position.\n
  • then people beat a path to your door, and then you used marketing to protect that position.\n
  • then people beat a path to your door, and then you used marketing to protect that position.\n
  • For instance, if we were to look at the advertising budgets of Apple and Microsoft, we’d find that they spend more now on marketing now than they did back when they were a startup. Even as a fraction of their sizable income today!\n\nThe same would apply to the history of these companies…think about it.\n
  • For instance, if we were to look at the advertising budgets of Apple and Microsoft, we’d find that they spend more now on marketing now than they did back when they were a startup. Even as a fraction of their sizable income today!\n\nThe same would apply to the history of these companies…think about it.\n
  • For instance, if we were to look at the advertising budgets of Apple and Microsoft, we’d find that they spend more now on marketing now than they did back when they were a startup. Even as a fraction of their sizable income today!\n\nThe same would apply to the history of these companies…think about it.\n
  • For instance, if we were to look at the advertising budgets of Apple and Microsoft, we’d find that they spend more now on marketing now than they did back when they were a startup. Even as a fraction of their sizable income today!\n\nThe same would apply to the history of these companies…think about it.\n
  • But that became the “Old” economy. In the DotCom boom, the marketing cart came before the product horse.\n\nSource: http://ddeubel.edublogs.org/2011/01/22/cart-before-the-horse/\n
  • The “New” Economy basically meant that you followed the Underpants Gnomes path to success…\n\n[Or New New Economy]\n
  • Step 1) Steal underpants (I mean make superbowl commercial)\n\n\nSource: http://www.stefanoparis.com/stefmedia/petsdotcom/sockpuppetlove/puppetlovehalf.jpg\n\nhttp://www.youtube.com/watch?v=sICSyC9u5iI\n
  • Step 2)… Step 3) Profit!\n\n[Or New New Economy]\n
  • Step 2)… Step 3) Profit!\n\n[Or New New Economy]\n
  • Step 2)… Step 3) Profit!\n\n[Or New New Economy]\n
  • Step 2)… Step 3) Profit!\n\n[Or New New Economy]\n
  • Step 2)… Step 3) Profit!\n\n[Or New New Economy]\n
  • It got to the point where you were giving free shipping on 40lb bags of dogfood! (just to acquire a customer)\n\n\nSource: http://www.stefanoparis.com/stefmedia/petsdotcom/sockpuppetlove/puppetlovehalf.jpg\n\nhttp://www.youtube.com/watch?v=sICSyC9u5iI\n
  • For some strange reason that model failed. And VC would no longer pony up millions to put the up a Superbowl commercial featuring a sock puppet. But what to do about marketing? How do you get users? Well we had this concept of social networks so…\n
  • Viral marketing. People often use viral marketing and “word of mouth” marketing interchangeably. But they are not the same. For one, “word of mouth” has been around forever. So what is the difference for reals?\n\nSource: http://www.socialsignal.com/system/files/images/mouth-to-ear-whisper.hallmark.jpg\n
  • Viral marketing. People often use viral marketing and “word of mouth” marketing interchangeably. But they are not the same. For one, “word of mouth” has been around forever. So what is the difference for reals?\n\nSource: http://www.socialsignal.com/system/files/images/mouth-to-ear-whisper.hallmark.jpg\n
  • Viral marketing. People often use viral marketing and “word of mouth” marketing interchangeably. But they are not the same. For one, “word of mouth” has been around forever. So what is the difference for reals?\n\nSource: http://www.socialsignal.com/system/files/images/mouth-to-ear-whisper.hallmark.jpg\n
  • Viral marketing means the very act of users using the site brings more users to the site. [Pause or repeat]. The best example is the first one: Hotmail.\n
  • When people use Hotmail to send an e-mail… at the bottom of the e-mail was a signature: “Want free e-mail? Try Hotmail.” Now anyone receiving this e-mail would click the link and sign up, and send their friends e-mails with this link and they would sign up, and so on and so forth.\n\nSource: http://farm2.static.flickr.com/1290/4690702547_d9d5000e48_m.jpg\n
  • Pretty soon you are spreading across the internet like a computer virus. Hotmail back then grew like hotcakes, bled money, and sold to Microsoft for just shy of half a billion dollars back when that amount was worth something…and Microsoft would have paid far more for it.\n\nSource: http://scitechie.com/06/anatomy-of-a-pc-virus-how-pc-virus-works-animated-graphics/\n
  • Okay! this doesn’t exactly solve your Underpants Gnomes problem (unless you are Hotmail) but it does solve the marketing one. How does it work? The key is to realize…\n\n[Or New New Economy]\n
  • Okay! this doesn’t exactly solve your Underpants Gnomes problem (unless you are Hotmail) but it does solve the marketing one. How does it work? The key is to realize…\n\n[Or New New Economy]\n
  • Okay! this doesn’t exactly solve your Underpants Gnomes problem (unless you are Hotmail) but it does solve the marketing one. How does it work? The key is to realize…\n\n[Or New New Economy]\n
  • Okay! this doesn’t exactly solve your Underpants Gnomes problem (unless you are Hotmail) but it does solve the marketing one. How does it work? The key is to realize…\n\n[Or New New Economy]\n
  • Okay! this doesn’t exactly solve your Underpants Gnomes problem (unless you are Hotmail) but it does solve the marketing one. How does it work? The key is to realize…\n\n[Or New New Economy]\n
  • Okay! this doesn’t exactly solve your Underpants Gnomes problem (unless you are Hotmail) but it does solve the marketing one. How does it work? The key is to realize…\n\n[Or New New Economy]\n
  • Okay! this doesn’t exactly solve your Underpants Gnomes problem (unless you are Hotmail) but it does solve the marketing one. How does it work? The key is to realize…\n\n[Or New New Economy]\n
  • My boss at one startup once came to me saying “viral marketing” sounds too evil. And he wanted to start calling what we were doing “organic marketing.” At the time I was thinking, “just like a lawyer to want to use doublespeak for something that is a technical term to a scientist.” (We were classmates together at Caltech, but he went on to Stanford Law school and I went on to study theoretical condensed matter physics at the University of Illinois instead). Well whatever! Most viruses are organic so I guess if calling it viral marketing gives you the heebee jeebies, you can cal it this.\n
  • Let us re-examine this viral loop. At each step you lose users. Unil you close the loop. Emphasize the multiplier at the invite step.\n
  • Let us re-examine this viral loop. At each step you lose users. Unil you close the loop. Emphasize the multiplier at the invite step.\n
  • Let us re-examine this viral loop. At each step you lose users. Unil you close the loop. Emphasize the multiplier at the invite step.\n
  • Let us re-examine this viral loop. At each step you lose users. Unil you close the loop. Emphasize the multiplier at the invite step.\n
  • Let us re-examine this viral loop. At each step you lose users. Unil you close the loop. Emphasize the multiplier at the invite step.\n
  • Let us re-examine this viral loop. At each step you lose users. Unil you close the loop. Emphasize the multiplier at the invite step.\n
  • Let us re-examine this viral loop. At each step you lose users. Unil you close the loop. Emphasize the multiplier at the invite step.\n
  • Let us re-examine this viral loop. At each step you lose users. Unil you close the loop. Emphasize the multiplier at the invite step.\n
  • Let us re-examine this viral loop. At each step you lose users. Unil you close the loop. Emphasize the multiplier at the invite step.\n
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  • I studied theoretical condensed matter physics, and my graduate school advisor used to joke that there are only three sorts of problems physicists can solve: ones where there was exponential decay (like a capacitor discharge), exponential growth (like the speed of an object falling in a vacuum), or oscillations (like a pendulum swing)—and for the most part he was right since these are, at some level, the solutions to what is known as “linear differential equations.” Even complex things are often expressed as some combination of these three graphs.\n
  • I studied theoretical condensed matter physics, and my graduate school advisor used to joke that there are only three sorts of problems physicists can solve: ones where there was exponential decay (like a capacitor discharge), exponential growth (like the speed of an object falling in a vacuum), or oscillations (like a pendulum swing)—and for the most part he was right since these are, at some level, the solutions to what is known as “linear differential equations.” Even complex things are often expressed as some combination of these three graphs.\n
  • I studied theoretical condensed matter physics, and my graduate school advisor used to joke that there are only three sorts of problems physicists can solve: ones where there was exponential decay (like a capacitor discharge), exponential growth (like the speed of an object falling in a vacuum), or oscillations (like a pendulum swing)—and for the most part he was right since these are, at some level, the solutions to what is known as “linear differential equations.” Even complex things are often expressed as some combination of these three graphs.\n
  • Well the viral difference equation happens to be what’s known as as “first order difference equation” which has one of two solutions: Either user growth looks like the first curve, or it looks like the second. The difference is the viral coefficient. \n\nNote this is not the number of users, but the number of new users. So it means if your v<1, virality (itself) isn’t bringing new users in and your user growth is supplemented by other things—the b(t) in the equation earlier\n\n
  • Well the viral difference equation happens to be what’s known as as “first order difference equation” which has one of two solutions: Either user growth looks like the first curve, or it looks like the second. The difference is the viral coefficient. \n\nNote this is not the number of users, but the number of new users. So it means if your v<1, virality (itself) isn’t bringing new users in and your user growth is supplemented by other things—the b(t) in the equation earlier\n\n
  • Well the viral difference equation happens to be what’s known as as “first order difference equation” which has one of two solutions: Either user growth looks like the first curve, or it looks like the second. The difference is the viral coefficient. \n\nNote this is not the number of users, but the number of new users. So it means if your v<1, virality (itself) isn’t bringing new users in and your user growth is supplemented by other things—the b(t) in the equation earlier\n\n
  • Well the viral difference equation happens to be what’s known as as “first order difference equation” which has one of two solutions: Either user growth looks like the first curve, or it looks like the second. The difference is the viral coefficient. \n\nNote this is not the number of users, but the number of new users. So it means if your v<1, virality (itself) isn’t bringing new users in and your user growth is supplemented by other things—the b(t) in the equation earlier\n\n
  • Remember the born lucky thing in the beginning? Maybe you build your website your coefficient is greater than 1—that's being born lucky!\n\nMaking your luck? That’s because your viral coefficient is less than one and you have to tweak your user experience so that it is greater than one.\n
  • Remember the born lucky thing in the beginning? Maybe you build your website your coefficient is greater than 1—that's being born lucky!\n\nMaking your luck? That’s because your viral coefficient is less than one and you have to tweak your user experience so that it is greater than one.\n
  • Remember the born lucky thing in the beginning? Maybe you build your website your coefficient is greater than 1—that's being born lucky!\n\nMaking your luck? That’s because your viral coefficient is less than one and you have to tweak your user experience so that it is greater than one.\n
  • Remember the born lucky thing in the beginning? Maybe you build your website your coefficient is greater than 1—that's being born lucky!\n\nMaking your luck? That’s because your viral coefficient is less than one and you have to tweak your user experience so that it is greater than one.\n
  • Remember the born lucky thing in the beginning? Maybe you build your website your coefficient is greater than 1—that's being born lucky!\n\nMaking your luck? That’s because your viral coefficient is less than one and you have to tweak your user experience so that it is greater than one.\n
  • Remember the born lucky thing in the beginning? Maybe you build your website your coefficient is greater than 1—that's being born lucky!\n\nMaking your luck? That’s because your viral coefficient is less than one and you have to tweak your user experience so that it is greater than one.\n
  • Remember the born lucky thing in the beginning? Maybe you build your website your coefficient is greater than 1—that's being born lucky!\n\nMaking your luck? That’s because your viral coefficient is less than one and you have to tweak your user experience so that it is greater than one.\n
  • How do you “make your luck?” First, viral marketing is not just a marketing term and an interesting math equation. Remember the definition of viral marketing? “Using the site, brings users to the site.” Unlike word of mouth, in virality every step can be tracked and measured.\n
  • So the first thing you do is actually MEASURE EVERYTHING.\nThe page views are measurable. The user signups are measurable.\nThe number of contacts they import are measurable. Even if the user views the e-mail is measurable! You can measure the drop off at every stage.\n
  • So the first thing you do is actually MEASURE EVERYTHING.\nThe page views are measurable. The user signups are measurable.\nThe number of contacts they import are measurable. Even if the user views the e-mail is measurable! You can measure the drop off at every stage.\n
  • So the first thing you do is actually MEASURE EVERYTHING.\nThe page views are measurable. The user signups are measurable.\nThe number of contacts they import are measurable. Even if the user views the e-mail is measurable! You can measure the drop off at every stage.\n
  • So the first thing you do is actually MEASURE EVERYTHING.\nThe page views are measurable. The user signups are measurable.\nThe number of contacts they import are measurable. Even if the user views the e-mail is measurable! You can measure the drop off at every stage.\n
  • First a quick note about measuring and your engineers. All websites are built where the databases and data structures are designed to support customer-centric transactions. This is known as Online Transaction Processing. To do good measurement, the data needs to be structured for business needs. This is known as Online Analytical Processing. It is easy for a website that has been built to handle a user account creation to look up their password on login. It is harder for that same website to answer the question, “How many users coming from the U.S. signed up via Facebook Connect in the last week because they received email test A from user group B?” Business questions are always “count this (or sum this) over these attributes grouped by this” these questions are called Online Analytical Processing and to answer these quickly, a separate data structure needs to be created running parallel to the other. If you use “Google Analytics” you do this already, to some extent.\n\nReference:\nhttp://www.americanshopperssurvey.com/\nhttp://habershampromotions.com/?p=168\n
  • First a quick note about measuring and your engineers. All websites are built where the databases and data structures are designed to support customer-centric transactions. This is known as Online Transaction Processing. To do good measurement, the data needs to be structured for business needs. This is known as Online Analytical Processing. It is easy for a website that has been built to handle a user account creation to look up their password on login. It is harder for that same website to answer the question, “How many users coming from the U.S. signed up via Facebook Connect in the last week because they received email test A from user group B?” Business questions are always “count this (or sum this) over these attributes grouped by this” these questions are called Online Analytical Processing and to answer these quickly, a separate data structure needs to be created running parallel to the other. If you use “Google Analytics” you do this already, to some extent.\n\nReference:\nhttp://www.americanshopperssurvey.com/\nhttp://habershampromotions.com/?p=168\n
  • To this, we add testing. Remember the definition of viral marketing? “Using the site, brings users to the site.” And we’ve seen that they can be measured, but they can also be optimized!\n\nImages:\nhttp://barefootcontessameals.wordpress.com/2011/01/16/meals-cook-book-code-key/\nhttp://www.greatoccupations.com/archives/551\n
  • To this, we add testing. Remember the definition of viral marketing? “Using the site, brings users to the site.” And we’ve seen that they can be measured, but they can also be optimized!\n\nImages:\nhttp://barefootcontessameals.wordpress.com/2011/01/16/meals-cook-book-code-key/\nhttp://www.greatoccupations.com/archives/551\n
  • When applied to the viral loop this is called viral tuning.\n
  • When applied to the viral loop this is called viral tuning.\n
  • When applied to the viral loop this is called viral tuning.\n
  • Describe A-B testing\n
  • For instance, Tagged found that if they added a smiley face to the end of the subject line of the e-mail, 20% more users click would actually bother to read the e-mail. That’s a big different to the viral coefficent since the less dropoff is multiplied in. By the way? how do we measure that was 20%? We used a web bug. I did mention that I had worked for evil right?\n\nSOurce: http://images.fanpop.com/images/image_uploads/A-Bug-s-Life-a-bugs-life-626985_1280_1024.jpg\n
  • For instance, Tagged found that if they added a smiley face to the end of the subject line of the e-mail, 20% more users click would actually bother to read the e-mail. That’s a big different to the viral coefficent since the less dropoff is multiplied in. By the way? how do we measure that was 20%? We used a web bug. I did mention that I had worked for evil right?\n\nSOurce: http://images.fanpop.com/images/image_uploads/A-Bug-s-Life-a-bugs-life-626985_1280_1024.jpg\n
  • And if this pushes the viral coefficient from just under one to just over one, you will have an entirely different growth curve! (remember the solutions I showed earlier?)\n
  • …and you have made your own luck.\n\nMaybe before you averaging 100 signups a day. After tuning you have a 300 signup day, then 1000! then your website crashes because the web code didn't scale and the servers went down. This is called the “hockey stick” and it matches the the born lucky curve exactly..\n\nSource: http://www.hockeydogs.com/ProductImages/sticks/CCM%20V4.0%20Stick.jpg\n
  • But at LinkedIn they found the exact opposite effect. 20% less users!. Imagine if your viral coefficient was .99. Then the smiley face may put you over…or keep you from going viral. [How do you know the difference? You test them!]\n\n[You use AB-testing]\n
  • Speaking of LinkedIn, let’s compare it to Plaxo. Plaxo discovered viral tuning earlier, but Plaxo got burned as the first and marked as spam and stopped. LinkedIn learned it from the founders at Tagged, and while Plaxo was avoiding social networking as a fad, LinkedIn applied that to business social networking, very successfully, I might add.\n
  • \n
  • In the quest to tighten the loop you will notice that a huge drop off occurs at the homepage (How big is it, well see WordPress’s homepage? that signup used to be on the right, moving it to the left doubled signups because the left the user thinks it is a skyscraper ad, I guess). While WordPress still runs contrarian, that’s why sites started to adopt signup on the homepage. Even “born lucky” sites like facebook started to do it. I question the morals of trying to get people to sign up before they’ve know who you are, but whatever.\n
  • In the quest to tighten the loop you will notice that a huge drop off occurs at the homepage (How big is it, well see WordPress’s homepage? that signup used to be on the right, moving it to the left doubled signups because the left the user thinks it is a skyscraper ad, I guess). While WordPress still runs contrarian, that’s why sites started to adopt signup on the homepage. Even “born lucky” sites like facebook started to do it. I question the morals of trying to get people to sign up before they’ve know who you are, but whatever.\n
  • In the quest to tighten the loop you will notice that a huge drop off occurs at the homepage (How big is it, well see WordPress’s homepage? that signup used to be on the right, moving it to the left doubled signups because the left the user thinks it is a skyscraper ad, I guess). While WordPress still runs contrarian, that’s why sites started to adopt signup on the homepage. Even “born lucky” sites like facebook started to do it. I question the morals of trying to get people to sign up before they’ve know who you are, but whatever.\n
  • In the quest to tighten the loop you will notice that a huge drop off occurs at the homepage (How big is it, well see WordPress’s homepage? that signup used to be on the right, moving it to the left doubled signups because the left the user thinks it is a skyscraper ad, I guess). While WordPress still runs contrarian, that’s why sites started to adopt signup on the homepage. Even “born lucky” sites like facebook started to do it. I question the morals of trying to get people to sign up before they’ve know who you are, but whatever.\n
  • Recall viral tuning. Once you’ve built it, there is nothing saying you can’t apply the right side of the equation to something else.\n
  • Recall viral tuning. Once you’ve built it, there is nothing saying you can’t apply the right side of the equation to something else.\n
  • Recall viral tuning. Once you’ve built it, there is nothing saying you can’t apply the right side of the equation to something else.\n
  • The key is not virality but measuring and testing—and that can be applied anywhere. Want to map out the cost of site speed?\n\nImages:\nhttp://barefootcontessameals.wordpress.com/2011/01/16/meals-cook-book-code-key/\nhttp://www.greatoccupations.com/archives/551\n
  • Want to test the benefits of improved performance? At once company, we deliberately slow down the site for some users and measure their activity.\n\nWant to compare the value of two CDNs (explain CDN) at two different prices? Bin users into once CDN or the other, use javascript in every users (or fraction) record image download time on completion and ajax the times to your servers. Compare that to the previous calculations on site slowdown and you know what the cost will be.\n\nWe’ve done it for user activity, revenue, etc. [About my “meet me” app]\n
  • Adding domain purchases. PC magazine rated us best website service (beating Tumblr, Posterous, Twitter, and others) and a key point was the reviewers mentioned that were were the only one that made it this easy to buy your own domain.\n
  • The difference here is that there's no feedback loop so the viral growth equation doesn’t apply. That's an important thing that I’ve seen a lot of people forget. I WISH tuning to boost revenue would create a positive feedback loop that generates exponential growth :-D\n
  • Now don’t get too deluded with statistical power. You can’t measure thinks like "word of mouth". Once Tagged applied a Zynga trick for virality. It put our viral coefficient above 1 again. And also got us this…\n\n\n[adding an X factor to your faith in numbers … Against the objections of many in the company it was implemented.]\n\n
  • Sure for two days before it was turned off we had a million and a half signups, But this article was the most e-mailed article on Time.com for the entire week. That damage is immeasurable… literally!\n\n[—that’s the entire city of San Francisco!]\n\nSource: http://www.time.com/time/business/article/0,8599,1903810,00.html\n
  • Oh yeah… the company got sued by the state of New York…Twice! So what’s the moral of this story? It's way better to be born lucky… (even if mean reversion means that your founder is unlucky in cards.) Thank you.\n\nSource: http://ma.tt/\n
  • \n

Transcript

  • 1. Tales of Virality Terry Chay OSCON August 28, 2011, 5PM
  • 2. I’m an Engineer
  • 3. Mousetrap
  • 4. “Old” Economy1. Build Better Mousetrap
  • 5. “Old” Economy1. Build Better Mousetrap2. People beat a path to your door
  • 6. “Old” Economy1. Build Better Mousetrap2. People beat a path to your door3. Use marketing to PROTECT that position
  • 7. Web 1.01. Steal Underpants2.3.
  • 8. Web 1.01. Steal Underpants2. ???3. Profit!
  • 9. Web 1.01. Steal Underpants Make Superbowl Commercial2. ???3. Profit!
  • 10. Web 1.01. Steal Underpants Make Superbowl Commercial2. ???
  • 11. Web 1.01. Steal Underpants Make Superbowl Commercial2. ???3. Profit!
  • 12. Web 2.0
  • 13. Viral Marketing
  • 14. Viral Marketing
  • 15. Viral Marketing
  • 16. Viral Codefunction virality(&$x) { ++$x;}do { virality($users);} while (true);
  • 17. Web 2.0 = Viral Marketing
  • 18. Web 2.0 (Hotmail and Youtube Strategery)1. Make Superbowl Commercial2. ???3. Profit??
  • 19. Web 2.0 (Hotmail and Youtube Strategery)1. Make Superbowl Commercial Make a Viral Product2. ???3. Profit??
  • 20. Web 2.0 (Hotmail and Youtube Strategery)1. Make Superbowl Commercial Make a Viral Product2. ???
  • 21. Web 2.0 (Hotmail and Youtube Strategery)1. Make Superbowl Commercial Make a Viral Product2. ???3. Profit??
  • 22. Web 2.0 (Hotmail and Youtube Strategery)1. Make Superbowl Commercial Make a Viral Product2. ???3. Profit?? Get bought out by Microsoft or Google
  • 23. Organic Marketing
  • 24. Viral Loop
  • 25. Viral LoopUser receives e-mail invite
  • 26. Viral LoopUser receives e-mail inviteUser reads e-mail
  • 27. Viral LoopUser receives e-mail inviteUser reads e-mailUser clicks on invite
  • 28. Viral LoopUser receives e-mail inviteUser reads e-mailUser clicks on inviteUser joins
  • 29. Viral LoopUser receives e-mail inviteUser reads e-mailUser clicks on inviteUser joins
  • 30. Viral LoopUser receives e-mail inviteUser reads e-mailUser clicks on inviteUser joinsUser invites more users
  • 31. Viral LoopUser receives e-mail inviteUser reads e-mailUser clicks on inviteUser joinsUser invites more users
  • 32. Difference Equation xt = vxt-1 + bt
  • 33. Difference Equation xt = vxt-1 + btxt = the number of new users at the next “timestep”
  • 34. Difference Equation xt = vxt-1 + btxt = the number of new users at the next “timestep”xt-1 = the number of users currently brought in
  • 35. Difference Equation xt = vxt-1 + btxt = the number of new users at the next “timestep”xt-1 = the number of users currently brought inv = the multiple of all the losses * the averagenumber of invites
  • 36. Difference Equation xt = vxt-1 + btxt = the number of new users at the next “timestep”xt-1 = the number of users currently brought inv = the multiple of all the losses * the averagenumber of invitesb = new users brought through traditional means
  • 37. Difference Equation xt = vxt-1 + btxt = the number of new users at the next “timestep”xt-1 = the number of users currently brought inv = the multiple of all the losses * the averagenumber of invitesb = new users brought through traditional means“time step” is median time to go through the loop
  • 38. Physics
  • 39. Physics
  • 40. Physics
  • 41. Physics
  • 42. Viral Coefficient (v)
  • 43. Viral Coefficient (v) v<1
  • 44. Viral Coefficient (v)v≥1 v<1
  • 45. v≥1 v<1
  • 46. v≥1 v<1
  • 47. Measuringeverything
  • 48. Measuringeverything
  • 49. Measuringeverything
  • 50. Measuringeverything
  • 51. Measuringeverything
  • 52. OLTP vs OLAP
  • 53. OLTP vs OLAP
  • 54. OLTP vs OLAP
  • 55. Measure + Test
  • 56. Measure + Test +
  • 57. +
  • 58. +applied to viral loop
  • 59. ViralTuning = + applied to viral loop
  • 60. A-B Testing
  • 61. This Smiley can make the difference…
  • 62. This Smiley can make the difference… :-)
  • 63. This Smiley can make the difference… :-)
  • 64. “Hockey Stick”
  • 65. “Hockey Stick”
  • 66. :-(
  • 67. Plaxo’s green e-mails“Genetic Algorithm”
  • 68. Tightening the Loop
  • 69. Tightening the Loop
  • 70. Tightening the Loop
  • 71. Tightening the Loop
  • 72. Tightening the Loop
  • 73. +
  • 74. +applied to viral loop
  • 75. ViralTuning = + applied to viral loop
  • 76. Key = Measure + Test = +
  • 77. Other things you can “tune”
  • 78. Tuning revenue
  • 79. Warning: NOT viral tuning
  • 80. Thank you!slides will be at: http://www.slideshare.net/tychayleave a comment: http://www.oscon.com/oscon2011/public/schedule/detail/18892contact me: tychay@php.net, @tychay,http://terrychay.com/