Definition
Viral marketing is a business strategy that uses existing social networks to promote a product or service. This approach encourages individuals to share information about the product, often through electronic communication or word-of-mouth. The goal is to increase brand awareness rapidly, much like how a virus spreads from one person to another.
Key Takeaways
- Viral Marketing is a business strategy that uses existing social networks to promote a product. Its name refers to how consumers spread information about a product with other people in their social networks, much in the same way a virus spreads.
- It seeks to create a unique and entertaining or interesting message or piece of content that consumers will want to share with others. This often takes the form of video clips, interactive Flash games, images, or even text messages.
- Compared to other marketing strategies, viral marketing can be a cost-effective way to reach a large audience quickly. However, it can also be unpredictable and hard to control, as it heavily relies on the consumers’ willingness to share the content.
Importance
Viral Marketing is a vital financial term because it describes a cost-effective and innovative marketing strategy where information and opinions about a product or service spread exponentially amongst consumers, comparable to how a biological virus spreads.
The importance lies in its potential for a high degree of exposure and market penetration, often achieved through social networks.
Not only does it help in increasing the brand awareness, but it also has the potential to dramatically amplify sales with relatively low investment.
As the marketing message spreads, it gains momentum and can ‘infect’ a large audience at a higher speed, providing businesses with robust return on their investments.
Furthermore, since viral marketing often relies on consumers sharing the message, it also aids in building strong customer relationships and trust.
Explanation
Viral marketing is a powerful tool in the financial world that is employed predominantly to spark interest and increase demand for a product or service. The central purpose of viral marketing is to create intriguing or entertaining content that consumers spontaneously wish to share with others in their network. This strategy allows a message to be spread rapidly and exponentially, similar to the mechanism of a virus, hence the term “viral” marketing.
It takes advantage of the quick sharing capabilities of digital media to reach a broad audience in a short span of time, at minimal cost. Viral marketing can lead to large scale visibility and high user engagement, even conversion to sales if executed effectively. Viral marketing is often used by enterprises to boost their brand image, introduce new products or services, or increase their market footprint.
It capitalizes on social networks, word-of-mouth, and other user-driven platforms to propagate a message, making the recipients both the target audience and the medium for message dissemination. This methodology is especially useful when it catalyzes organic growth—people sharing the message because they find it engaging or beneficial, not because they are incentivized through formal channels. Hence, viral marketing has become a vital component of the promotional strategies of many enterprises that wish to maximize outreach and minimize cost, making it a high-value tactic in the modern digital landscape.
Examples of Viral Marketing
“The Blair Witch Project”: This 1999 horror movie is often considered one of the first and most successful examples of viral marketing. The filmmakers created a website featuring fictitious police reports and ‘newsreel-style’ interviews about the disappearance of three film students, which many people believed was real. This low-budget mockumentary ended up grossing nearly $250 million worldwide.
Hotmail: Hotmail is one of the earliest examples of viral marketing on the internet. In 1996, every email sent from a Hotmail account had a small message at the bottom encouraging people to sign up for their free email service. By 1998, Hotmail had grown to 12 million users, largely because of this simple marketing technique.
The Ice Bucket Challenge: This campaign to raise awareness and money for ALS (Lou Gehrig’s disease) went viral in the summer of
Participants were dared to dump a bucket of ice water on their heads, donate to ALS research, and then challenge others to do the same. The Ice Bucket Challenge was massively successful, attracting participation from celebrities and ordinary individuals alike, generating millions of videos, and raising over $115 million for ALS research in the U.S. alone.
FAQs on Viral Marketing
1. What is Viral Marketing?
Viral marketing is a business strategy that uses existing social networks to promote a product. Its name refers to how consumers spread information about a product with others in their social networks, much in the same way that a virus spreads from one person to another.
2. How does Viral Marketing work?
Viral marketing works by encouraging individuals to share a marketing message to others, creating the potential for exponential growth in the message’s exposure and influence. Like viruses, such strategies take advantage of rapid multiplication to explode the message to thousands, to millions.
3. What are the benefits of Viral Marketing?
Viral Marketing is a great way to get a lot of exposure for your business. It’s a great way to get your business noticed and it can be a very cost-effective way to grow your customer base. It can also lead to an increase in brand recognition and sales.
4. What are the drawbacks of Viral Marketing?
Despite its potential to provide massive amounts of brand exposure, viral marketing is not without its risks and challenges, such as unforeseen negative publicity and difficulty in tracking and measuring results.
5. What are some examples of successful Viral Marketing campaigns?
Examples of successful viral marketing campaigns include the “Share a Coke” campaign by Coca Cola, and the Ice Bucket Challenge by ALS Association.
Related Entrepreneurship Terms
- Social Media Campaigns
- User-Generated Content
- Influencer Marketing
- Content Marketing
- Brand Awareness
Sources for More Information
- Entrepreneur: This site has plenty of educational pieces on various marketing strategies, including viral marketing.
- HubSpot: An inbound marketing, sales and service software provider that also publishes a lot of insightful content on marketing tactics such as viral marketing.
- Forbes: Renowned for their business and finance advice, Forbes frequently covers topics in marketing, including viral campaigns.
- Harvard Business Review: This publication often delves into complex business strategies, with plenty of content related to viral marketing and its effectiveness.
