Barriers to Viral Growth

Jun 26

Barriers to Viral Growth

In this month’s customer Newsletter I covered the a basic survival principle:

Only Apps with a Viral Hockeystick will survive

App Survival & Dominance

The principle here can be explained by a sequence of charts:

In any App sector now there is always competitors – and in fact its normal that you actually have copy-cat apps that have been invented to directly steal your audience.Its a tough situation and the equation for success is a combination of methods, tactics, skills and luck to have your way to growth.
But a key part of growth is to nail your user acquisition strategy and make it viral. These charts tell the story of 2 competitor Apps.

  1. Initially you are both going to acquire linearly (launch day bumps aside)
    Viral Hockeystick 1

    Step 1

  2. Linear growth may appear to be a terrific start. You’re ahead of the competition and paid is working for you (at least in terms of getting users). But it seems like your competitor has nailed some viral growth – something is getting users to share/invite with other users. We call this k-factor.
    hockeystick-2

    Step 2

  3. Now your competitor has caught up, passed you and seeing a drop in new users. In desperation, you ramp up your spend and acquire users that arn’t well targeted.
    hockeystick-3

    Step 3

  4. Its now clear the competition is eating your target user-base and they are nudging ahead. You can easily see how their sharing users are even going to recruit users to defect from your application – “all the cool-kids are over there”.
    hockeystick-4

    Step 4

  5. Game Over!
    You tried your best but basically you were outsmarted – and in Apps, its often a winner-takes-all result.
    hockeystick-5

    Step 5

Components of Viral Growth

I’ve written a whole series of k-factor posts before here, here,  here and viral posts. But in summary there are a few key things you need to get right:

App utility & experience

Its a given that you need to be:

  • solving a big problem for the user
  • OR delivering great novelty to the user

Sharable Content

If you are competing with another App – ask what aspects of your utility or content are inherently about what people will discuss together. This is why chat and pics have been the first wave of massive Apps because Shareable Content is at the core of the product. If your competitor surfaces sharing
If you are a fashion retailer, don’t just make a catalog App – make a look-book App or let the user send pictures of themselves in your clothes to their friends.

Sharability

As hinted above, put your sharing buttons in the middle of the user experience, don’t hide it in a menu somewhere. Make sure you support all the viral platforms: Instagram, Snapchat, Facebook etc. Make sure you support all the intimate platforms: Email, SMS etc

Invite Incentives

“Member-get-Member” has been around in direct marketing for more than 30 years. If you think about what Uber, Lyft, Sprig and all the other “Mobile-first” companies are doing with referral codes/coupons

Great Onboarding

This is imperative. The chart on the right shows the latest results from guru Andrew Chen – on average only 23% of users will ever return to your App. But the best apps perform around 50% better keeping over 70% of their users. The big difference is “FTUX” – First Time User Experience and is largely defined by how you onboard each and every user.
untenable churn rates

Barriers

Desire

A user needs to be in a state of desire (or need) to install your App – the 2 stats I provided in the Newsletter:

  • Neilsen reports: Referrals rate 84% effective in driving decisions. Far ahead of other methods.
  • Harvard Business Review says: 18% higher retention and 16% profit uplift from referral based business. This uplift is 35% for GenX/GenY.

Clearly a great driver of desire is the social impact a recommendation has. Social Reciprocity is a huge driver of network effects. Facebook “liking” is a classic reciprocity action to make the poster feel great about themselves and you for liking them. In Apps if a good friend recommends, then you are going to install because of synergistic interests and/or relationship obligation.

Appstore Friction

Even if your prospective user clicks a link to your App, the biggest barrier in Mobile Apps that differs from Web Apps is obviously what happens at the AppStore or Google Play – if the user isn’t in a state of high desire, then your ASO may not get them click the install button. Its well covered elsewhere but reduce friction:

  • Crisp clean description
  • Great Icon design
  • App Screenshots that are meaningful basis of the benefits of the App. (Would you believe some Apps show pictures of a registration page! 🙁
  • Positive Reviews on top
  • Happy user quote in your description

Download Friction

App size, network connectivity, network speed, user “busy-ness” all lead to 2 friction points:

  1. Download Abandonment
  2. User forgets the App was installed

If the user never opens the App, then you were close but no cigar! (whatever that saying means).

Onboarding Friction

Common Sense

Long term readers know I’m very anti “registration on first open”.
There really is no excuse for not giving your new installer a happy experience upon opening the application. This “FTUX” (First-time-user-experience) is a key step in “Activation”. I’ve also written on deferring App permissions until you’ve gained the user’s trust and explained what the user gets in return for opt-ing in.

Broken Viral Sharing

The picture below is a process that we’ve fixed at StreetHawk – here is the current sequence:

  • I’ve got a cooking App, I love a recipe and send it to you via Email, SMS or Facebook
  • But you don’t have the App
  • You click the link and land on a Website.
  • Even if you finally install the App, you don’t get that recipe I sent.
mobile-onboarding-broken

Making Viral Sharing Work

StreetHawk fixes the FTUX by connecting the new installer to the content. So you get the recipe that I sent to you when you open the App. This is great because you are directly engaged in a frictionless “First-time-user-experience” and that leads to higher engagement and retention.

  Get our Referral Program Guide