Friday, 26 October 2007

Viral marketing vs Traditional Marketing- is the Facebook model destined to rule?

After you have sorted thro the messages, checked out your and your friends' feeds, bitten (vamipres, zombies), poked, superpoked, petted (fluff friends) etc, take a break to ponder on the phenomenon Facebook has become. Here is a social networking applications which, apparently is the second most " in" activity on US college campuses, tied to beer and sex. A website, that with very limited revenues (!) has hit a valuation of 11 figures, whose founder with all the mighty weight of his 23 years of existence is on the negotiating table with Steve Ballmer, the CEO fo Microsoft who is willing to buy a stake on facebook valued at $ 15 Billion.

So, what has this got to do with Viral marketing? Lets get to the same plate first in terms of semantics - when I say viral marketing, I mean the aggressive spread of awareness through recommendations from users, as compared to a top-down advertising led approach- the crux of the issue is- your users are responsible for marketing, rather similar to the way a virus spreads.

I wonder though, does this mean the early "end of days" for the traditional model of Advertising? This model relies on a budget led, planned approach has a specific purpose- expend all your energy on creating awareness- sort of a centralized planning model. But Viral marketing is, ofcourse, entirely different. Being viral, in many senses is about designing for aggressive propogation, but actually have no control over how this propogation happens. The fundamental questions in the approaches are diffent- the first model is about what are my outcomes, (TRP, GRP, awareness percentages etc), whereas, the second model's fundamental question is- How do I design the campaign so the user will recommend this to other users on an infinite propogation loop and trials happen through the user generated propogation.

The benefits of a viral approach seem to be very compelling- the biggest being you don't have big budgets for marketing, and of course, user engagement is, by definition very high- hence very loyal. But there are issues too- look at how rapidly MySpace seems to be falling out of favour- virus propogation is very spiky, and akin to a fad- here today, gone tomorrow…But hey, definitely a potent weapon in your arsenal…

 

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