App marketing costs are still increasing. This month Chartboost announced the cost per install for iOS had risen again, taking the average cost per install to $2.27 for iPhone apps and to $2.68 for iPad apps.
Whilst this is of course is fantastic news for publishers, indie advertisers are being asked to spend more than ever to acquire users for their applications.
With this in mind, we decided to explore three ways you can create a viral loop within your application to help your product generate as much organic reach as possible.
What Is A Viral Loop?
A viral loop is where the consumers of a product become the primary marketers. Growth is fast, cheap, and self sustainable as users are driven to generate more users.
Let’s take a look at some use cases, just to put the ‘viral loop’ into context:
1. Please download this app. [Not Viral]
2. This is the best app at doing X. I’m going to invite my friends to this app. [Viral, but not a loop]
3. This app is so much better when all my friends use it too. I’m going to invite more, and more, and more. [Viral loop]
Image Credit: Josh Jeffryes
How does a Viral Loop work?
1 user -> invites 1 new user = 2 users
2 users -> invite 2 new users = 4 users
4 users -> invite 4 new users = 8 users
8 users -> invite 8 new users = 16 users
16 users -> invite 16 new users = 32 users
32 users -> invite 32 new users = 64 users
64 users -> invite 64 new users = 128 users
128 users -> invite 128 new users = 256 users
The actual science behind a viral loop
To find out if your viral loop will be successful, you can use the following equation:
VC = N x P1 x P2
Don’t freak out. It’s barely science and easy to understand. You should want to memorize it because it will tell you, in no uncertain terms, what your viral loop will need to work. Each of the variables in the equation represents a particular aspect of viral loop marketing:
VC – stands for “Viral Coefficient” and is the result of the equation, the most important bit.
N – is the average number of customers who are invited by each active user who invites.
P1 – the proportion of invited users who sign up and become active customers.
P2 – represents the proportion of active users who invite other people.
To use this equation, you plug in the appropriate values, based on your analytics, for N, P1, and P2. Then multiply them together to get your result, VC. The value of VC will tell you how well your loop will grow, in one of the following three ways:
– If VC is greater than 1, you can expect to see the growth of your viral loop increase exponentially.
– If VC is less than 1, you’ll need to monitor and remarket your content to keep it going.
– If VC is 0, you will see no growth whatsoever.
Thanks to our friends at GrowthDevil.com for this!
Implementing a Viral Loop
This needs to be done when you first start planning your product. For any viral loop to work, you need to have strong social integration, preferably with Twitter or Facebook Connect. This makes it trivial for your users to invite their friends to your application.
One thing to bear in mind is that, unlike on the web, you are restricted in terms of the types of viral loop you can implement in a native application. Some of the legendary growth strategies such as Dropbox’s ‘The more you refer, the more space you get’ simply aren’t possible on the App Store. With IAPs and subscriptions in the hands of Apple, you have to play by their rules.
The good news is, there are other ways you can execute a viral loop within your application. We’ve documented three examples of how you can set up a viral loop in your own application:
1. Social Competition
For games, the competitive nature of human beings is one of the best traits to exploit when building a viral loop. Many games on the App Store already rely on users competing against each other or against a leaderboard on Game Center/OpenFeint.
However, there are better ways of using competitive spirit in order to bring more players into your game. Social integration via game engagement platforms such as NextPeer are a smart way to get more players using your app.
A viral loop in this situation would look like:
1. User downloads game
2. User sets a score and sends it to a friend as a challenge
3. The friend receives a push notification, prompting them to download the app and beat their peer.
This loop goes beyond just user acquisition. As user engagement will be stronger when users are competing against their friends, this loop often leads to increased conversion rates on IAPs too.
“Ultimately, viral loops are like induction proofs” – Andrew Chen
2. Request Help From Your Friends
Have you ever reached that impossible level of a quiz/game and needed a little help? Well, some game developers have been cashing in on this state of mind by allowing users to ask friends to them help progress through an app.
There are several examples of this strategy bringing huge success to a number of popular iOS games. In 4Pics1Word, users share a photo of the level they are stuck on to Facebook, prompting their friends to help them guess the correct answer. This viral loop resulted in hundreds of thousands of users uploading screenshots of the app to social networks, and was a key user acquisition tool for the product.
Candy Crush has implemented a similar strategy, tip toeing around Apple’s review guidelines in the process. When users reach a tough level, they can ask their friends for lives and help with progressing to the next level. They can also send people they know extra moves and other benefits in the process.
3. The Queue Jumper
The most famous example of this was Mailbox, which registered 1.25 million people to their waiting list within 3 weeks of launch. For almost a month, I remember my Twitter feed being filled with users sharing their queue position as they eagerly awaited full access to Mailbox.
Why was this happening?
Well, Mailbox cashed in on their huge waiting list, allowing users to jump up the queue if they shared the app to their social networks. This viral loop worked, and on March 15th 2013, Dropbox acquired Mailbox for $100 million.
Viral loops are iterated on…
Whilst viral loops are inexpensive ways to drive sharp organic growth, they are very much an iterative process.
Image credit: Intercom
Before setting up any viral loop, you absolutely have to ensure that you are tracking all key events within your app, as data driven decisions are essential. Where should your CTA be placed? Which social networks are driving the most traffic to you? What editorial/imagery drives the most engagement and conversions? All of these variables must be tracked and iterated on in order to scale your viral loop effectively.
Something to think about…
When executing a viral loop on iOS, you are very much at the mercy of Apple. It’s been well documented over recent months that Apple are struggling to make up their mind when it comes to incentivised social sharing, with TechCrunch claiming at the end of June that this was now within Apple’s guidelines once more.
To be on the safe side, we would recommend you check Apple’s Guidelines in detail before building a viral loop into your product.
– Developers that execute a viral loop well can achieve major growth in a short space of time.
– When users invite their friends to your app, you save money on expensive CPI channels.
– Viral loops are cheap to implement. They don’t have to cost you anything.
We created a SlideShare presentation of this post, you can view it here:
Have an idea for a great viral loop? Join the discussion with other developers on Tapdaq on this thread…