Loading ...I see atleast two examples of attempts at viral marketing by “Make my Trip” - High 5 program and “Seventymm” free six program.
None of these pays for getting a user to sign up. They have to buy a ticket or continue being a member for the refferer to receive benefits.
In pay per impression or pay per click merchants pay for just awareness. In viral marketing they pay for sign up which is a tougher bar for the viral marketer to cross. In India the bar for the viral marketer to cross is even higher. Usage and in some cases active usage.
Maybe these attempts at viral programs will work in India but I as a consumer would like to see an offering that is strong enough to retain customers after they register and is willing to pay for registrations. Obviously this lends itself to the system being gamed but if there are real benefits to users they will stay.
Would love to read comments from people on whether they think viral marketing will work in India and if yes in what form it will work ?
1. Virus: that which we give others just by interacting with them…not purposely
2. Word of mouth: that which we tell others purposely
Most of the times it is no. 2 that is mistakenly called Viral.
I don’t think money can make no.1 happen, because it is an unconscious ativity. Example of Viral: MSN Messenger: I bring you on for the selfish reason of communicating with you
If WOM is backed by money, it is not true WOM, but artifical WOM, which a. is sure to run out of steam; b. it lacks credbility an thus dosen’t work.Google, Nokia and closer home Jet Airways were built on WOM.
What you have decribed above is a type of MLM…which works in a special way and the promoter has to have business motive. I would instead do things like allow people to gift free subscribitions (DVD rentals) and give fat discount coupons to friends (Travel).
I think it is possble to do true Viral in both those models, but the product will have to be designed ground up towards that. So the travel site can be designed as a sort of Virtual Tourist/WAYN hybrid - getting people to participate and also selling them travel products …….
If you wanna brainstorm on that we could do it on your next bombay visit.
As an e-retailer, here is my view on the subject.
Today the ratio of visitors to shoppers is very high. Yes, it pays (PPC, etc.) to get users to your site, but if I have to shell out referral fees too, I would like to do so on an engagement by that visitor. The pulling out of the credit card and putting it on your site, is the real thing. No matter if its for $1. We have had specific referral campaigns run, where we offered the referred person a great deal, just for a dollar. While there is little difference between 0 cents and a dollar (considering our average transaction size of $65), the key difference is that it was a paid transaction that allowed a complete experience of a transaction cycle. Which is when that person is most likely to see the difference between my competitor and me. And to get _that_ to happen, I am willing to pay a referral fee (of whatever kind - be it loyalty points or actual cash back).
Even without the referral fee, there are many visitors who come to the site, ‘referred’ by friends. So the active WOM does happen - and how! That happens not because of the incentive, but because of a genuinely good experience, that a customer wants to talk about and share.
- Sanjay
RYK: It’s SLM - single level marketing. Multi level compensates you for hiring at multiple levels beneath, meaning if you bring someone on board you earn benefits, and if she gets someone else, you still earn benefits.
To the topic itself:
I started off writing something but it became too long, so:
http://tropicalmanager.blogspot.com/2006/12/disaffiliate-marketing.html
I would say that the budget allocated for advertisement must be used to pay for the referral. It may not be the payment in terms of monetary gains but in terms of loyalty perks. The factors may include how loyal one has been to the site in terms of volume of purchases and transaction, how many members referred by one has done the transaction. So like what the credit card companies pay as 3% or 5% cash back. The users may be lured with kind of perks. One other way would be to give free shipping or % discount for being a loyal returning or referring customer.
Thanks all for some very useful insights. Deepak’s write up on his blog is interesting. Apart from the design of the scheme in my opinion is that the tangible benefits must be strong. Conventional wisdom is that any form of advertising or promotion cannot help sustainably sell a bad product. I do not think there is a one size fits all solution. PayPal, Google, Skype all had incredible customer acquisition initially in the US and later globally but used different approaches. A key common design element in all of these cases was simplicity and ease of use.
My only first hand experience in India is dated and in the corporate market. In 1985 in India I had led a business for Citibank which got over 90% market share in cash management ( target market , top 300 companies in India) very quickly. The key there was a solution that improved liquidity dramatically which was backed by a no quibble service guarantee on which Citibank actually paid out atleast 5 lacs which was a lot of money back then. 5 lacs paid out as a % of revenue was miniscule. It pained me to sign those payout cheques not beacuse of the amount but because we had failed in our brand promise and even generous financial compensation was not good enough.
Service guarantees like the Dominos in 30 minutes or its free could also help in building market share. Dominos chose to use mass advertising. I do not know how successful the campaign was on a sustained basis but maybe the service guarantee with discounts (as Deepak suggests) may have been more cost effective.
I think viral marketing can work when there are enough candidates that can potentially get “infected” with virus. Typically the seeds of viral marketing are sown in very targeted groups and it spreads from there on. Most successful viral marketing campaigns (digg, youtube, myspace, napster, hotmail etc.) target the young crowd (teen and youth) because they tend to be more inclined to try out new things and show off among the peers. Unfortunately that demographic in India is not very hooked on to Internet even now. What they are hooked on to is mobile and so I think a viral marketing campaign using mobile as a medium would be interesting to try out and can work wonders. (assuming the service is really virusworthy).
Here is an interesting article I recently read on this topic
http://mashable.com/2006/12/13/how-to-have-an-overnight-internet-success-story/
Hi Madhur
I agree with you on the mobile angle. But are you referring to offline services or mobile-based services that can possibly benefit from a viral campaign?
Take something like hotel recommendations. Everyone’s got a cellphone, a great many are travelling all over the country (and overseas). Wouldn’t it be great if someone started a service providing recommendations on where to stay, where to eat, drink, etc? This can be a purely mobile-based service.
Or personalised weather reports. (”Hi, I’m thinking of driving down to Goa for Xmas, how’s the weather there?”)
But a site that provides such services may not (I think) gain from a mobile viral campaign.
cram,
There is no doubt that such mobile services would be useful, but what I am talking about is spreading your “idea virus” (in Seth Godin’s lingo) using mobile as a medium. So for e.g. Seth Godin mentions in his book that bumper sticker is one of the ways of spreading the word (maybe about your University). So here vehicle is the medium for carrying the word about something that has nothing to do with vehicles.
Here is an example of the top off my head. May or may not work, but just to explain the point. Lets say there is an Internet site (lets say DVD rental service) that provides you with one free year of SMS (or something like that) when you register for their service. Now everytime that user sends an SMS to someone from his mobile, it has a little ad at the end that “if you sign up for our service you get one year of free SMS too”. If you can seed this to one small set per demographic, imagine how quickly the word can spread and where all it can reach. Of course after this the site should be compelling enough that people really like it and are ready to pay for it.
I don’t think that ““Make my Trip” - High 5 program and “Seventymm” free six program” can be considered “viral marketing”. This is incentive based market, just like Expedia’s “50% off on your next vacation” type offers.
Instead of paying for advertising or affiliates, the companies are simply paying back to the customers for bringinig in more business. I totally agree with RYK and the mashable article.
Viral Marketing would work anywhere, where there is a need. A classic example is Orkut.com. Apart from the brand it carries and the 1337ness it had due to “invite only”, the main reason to invite friends on it was to simply stay in contact. People wanted to tell their friends/colleagues “I found a cool thing” and “let’s stay in touch.” If you don’t have friends on Orkut (or any other s/n), the reason for your existance on the site would vanish.
Sanjay Mehta: I wonder why you don’t have an affiliate system? Why can’t a male be a DMA (read last para)? Descrimination