The most cost-effective marketing device ever invented is called word-of-mouth marketing. A friend tells a friend who in turn, tells another friend. It costs nothing to the company and brings the added advantage of a recommendation from a trusted source. This marketing device has morphed into a term called "viral marketing" and it is now the hottest marketing technique on the Internet.

What is Viral Marketing?

HotMail.com was one of the first companies to use viral marketing to establish a strong presence on the Internet. Their concept was simple. Offer free email access on an anytime, anywhere basis in exchange for allowing a single line of promotion at the end of each message. The promotion line encouraged the recipient of the email message to go to hotmail.com and sign up for their own free email service. Because most email is sent to and from people who know each other, this message was extremely effective since it had the advantage of a personal recommendation. In other words, "my friend is using this service so it must be good".

In the first 18 months of being in business, Hotmail.com garnered 12 million subscribers with a total marketing budget of less than $500,000. That's a new customer acquisition cost of 4 cents per customer!

Give Me More Examples

Viral marketing can take many different forms and here are some examples of how other companies are using this concept on the Internet.

Amazon.com encourages their customers to "send a book to a friend". This simple technique enables Amazon.com to acquire new addresses of "pre-qualified" prospects and allows for the insertion of promotional material into the shipping container. They also pioneered the concept of affiliate marketing (another viral device) that pays other web sites a commission for every referral and resulting purchase. This takes advantage of drawing new traffic to Amazon from the traffic generated from other web sites.

Geocities enables people to create their own web sites. Obviously, the proud parents of the web site will email their friends and relatives to encourage them to visit. When they do, they will be presented with a marketing message to encourage them to build a site for themselves.

Mirabilis created a piece of software called ICQ that lets users know when their friends are online so they can initiate a real time chat session. If a person wants to use this, they have to get all their friends to download the software as well. (Obviously, AOL saw the tremendous opportunity this viral marketing campaign offered and purchased the company in 1998 for $287 million)

How Can I create a Viral Marketing Campaign to Schools and Libraries?

We can look at the models being created and "tweak" them to create viral marketing campaigns to our specific target audience. Here are a few ideas to get started:

Viral marketing is in its infancy and there will be new strategies developed as companies hone their skills at Internet Marketing.

ABOUT THE AUTHOR
This article was written by Carol Ann Waugh, President of Xcellent Marketing, a marketing and new business development firm specializing in the educational and library market. Xcellent Marketing offers a variety of marketing services to help publishers increase their revenues and profits from identifying new markets, providing critiques of web sites and marketing communications such as direct mail, catalogs, advertisements, etc. as well as developing effective traditional as well as Internet-based marketing plans. Carol can be reached at (303) 388-5215 or at cwaugh@xcellentmarketing.com.