Archive for April 21st, 2011
A time when I participated in viral marketing was in high school when I worked as an independent distributor for Herbal Life. The way the job worked you pay a certain amount for the starter pack which has material that you need to learn, free samples, and marketing plans. After that you use additional material they have posted online to sell Herbal life products and receive a percentage of every sale. You also get a certain percentage of sales made by people whom you referred to the company. This is a perfect example of viral marketing also known as a pyramid scheme because the upper management of the company is making money while people are paying to market for the company.
I think using viral marketing on a product with network effects is very risky because the product is only valuable if it is used by a large number of people and viral marketing is a system that spreads information on a very small scale from person to person. If the marketing campaign is successful and the viral marketing begins to spread quickly it would be especially good for the company because the value of the product will increase at a very quick pace. Conversely if the marketing plan is unsuccessful very few people will want buy the product because it won’t be valuable if a large number of people don’t use it.