Viral Marketing and New Product Development

Question 1

Organic content

Answer 1

Content that a person feels intrinsically motivated to prepare and share

Question 2

Consumer-solicited content

Answer 2

 Invited by brands but non-compensated

 A response to “call to action”

Question 3

Incentivized content

Answer 3

 Encouraged by the offer of an incentive

Question 4

Sponsored content

Answer 4

idk it was an option

Question 5

Accidental “Viral” Marketing

Answer 5

The “Beer Guy” Moment

Ocean Spray

Question 6

Viral marketing campaign (VMC) =

Answer 6

companies using social interactions for distributing content, launching new products, and generating product-related WOM

Question 7

__ _ __ brands are using some form of viral/influencer marketing

Answer 7

Nine of ten

Question 8

Influencers are social media’s opinion leaders

Answer 8

Reward power
Coercive power
Legitimate power
Referent power
Expert power
Informative power

Question 9

PSI refers to a kind of psychological relationship experienced by

Answer 9

an audience in their mediated encounters with performers in the mass media

 Media personalities perceived as friends
 “illusionary” experience as if engaging in a reciprocal
relationship
 Repeated PSI leads to parasocial relationship
 Social media provides additional opportunities for PSR to develop

Question 10

Categorization of Influencers

Answer 10

 Mega: 1M+ followers
 Macro: 100K+ followers
 Micro: 10K+ followers
 Nano: 500 to 10K followers

Question 11

While influencers generally have a conversion rate of around 3%,

Answer 11

nano influencers are converting at upwards of 30% in some cases.

Question 12

Influencers are required by the FTC to

Answer 12

disclose brand endorsements.

Question 13

Warner Bros Home Entertainment was charged with failing to disclose payment to prominent YouTuber gamers to promote its game,

Answer 13

Middle Earth: Shadow of Mordor.

Question 14

“Ford Fiesta Movement”

Answer 14

It was a grassroot campaign that made heavy use of online social media to build awareness and buzz for the 2011 North America Ford Fiesta

Question 15

Viral Marketing

Answer 15

 Give the products to a set of “seed” consumers so that they
can (1) experience the product and (2) then spread the word
about it to others
 “Buzz” agents
 Often used for relatively cheap consumer packaged goods

Question 16

What is inherently social?

Answer 16

in social media marketing terms, a product that is naturally

talked about is inherently social

Question 17

Consumers are more likely to talk about or share
information about brands or products that are inherently
social because

Answer 17

they are consumed with others

Question 18

 When a product is inherently social, customers are

Answer 18

intrinsically motivated to recruit/acquire new

users/customers on behalf of the company

Question 19

Network externality:

Answer 19

exists in a good (e.g., a product,
service, or brand more generally) if the utility an individual
consumer derives from that good depends
on whether others consume it

Question 20

If a consumer’s enjoyment of a product has nothing to do with
whether his or her friends are using it, the product

Answer 20

does not have

a network externality

Question 21

If your enjoyment is increasing with the number of other

people who are using the product – we call it a

Answer 21

positive

network externality

Question 22

If your enjoyment is decreasing with the number of other

people who are using the product – we call it a

Answer 22

negative

network externality

Question 23

Formally: U = I + a*E.

Answer 23

If the product has no network externality, a = 0
If the product has a positive network externality, a > 0
If the product has a negative network externality, a < 0

Question 24

The social media principle of building virality into

products to make them inherently social means you want

Answer 24

to maximize positive network externalities and/or
minimize negative network externalities:

 You want “a” to be as large as possible, such that others’
contribution to your utility is as great as possible

 If “a” cannot be positive in the context of your product, and if it
could be negative, you want it to be as close to zero as possible

Question 25

An entire product doesn’t have to have a positive
network externality (which might be impossible)
But

Answer 25

with a feature, or even an “add-on” that creates the
positive network effect, social media can be better
leveraged to increase demand for products

Question 26

Incorporate social features with sole purpose of

Answer 26

building
in virality (e.g., videogames)

Question 27

Develop positive externality through promotional

campaigns rewarding

Answer 27

sharing behavior or encouraging

referrals

Question 28

Ideally, refer-a-friend incentive should be increasing with

Answer 28

the number of other people who adopt new product as a consequence of that referral

Question 29

Companies with an established customer base can

leverage that base to

Answer 29

spread the word about new

products/services

Question 30

But what if you’re a brand no one has heard of?

 A phased approach:

Answer 30

 Before launch: identify target customers, reach out, get
feedback
 Launch: externally-based incentive to get seed customers
working to recruit new customers, treat new customers like
seeds
 Post-launch: repeat steps, post-launch analysis