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These days, your business isn’t getting anywhere without viral marketing and especially not without using social media. Getting your customers to visit your site, feed off the information and then share it with their friends is the key to growth hacking.

The steps a user goes through between entering and inviting more users to the site is called a “viral loop,” and this is the form of marketing that is responsible for businesses going from zero to million-dollar profit margins in a matter of weeks.

The idea behind viral loops is that a company will have a core loop that is repeated so many times over different generations of users that it causes a tailspin out into unfathomable popularity (i.e., becomes the “thing that all the kids are talking about”).

Because this core loop can be so crucial to the early success and sustainability of a business, getting it right from the start is imperative. There is no tried-and-true way of creating a successful viral loop, but there are methodologies and approaches that are helpful to learn.

It’s important to think about what goes on in the minds of people as they are sharing information. Human nature encourages us to pass on interesting info or funny content to our personal social networks.

People share information that is either indicative of their own personality, acts as an emotional outlet or is a conversation starter for their social network.

The thinking involved in viral loops goes like this:

  1. A user tries your product.
  2. She is offered a small incentive for sharing the product.
  3. The incentive works.
  4. She tells all her friends.
  5. Your business grows.

Here are a few different ways to structure your viral loop.

Basic Viral Loop

A basic viral loop means that you share a product with your friends, and you get more of it. Paperless Post gives you extra “coins” to buy more eCards each time you share with friends. It’s the most straightforward kind of viral loop. Dropbox is a great example of a company using the basic viral loop. Sharing with your friends gains you more storage space and new users get to expect the same benefits.

Savings-Driven Viral Loop

In this type of viral loop, both sides — the sharer and the receiver — are given a coupon. The coupon is usually some kind of percent-off or credit on the product. This means that the sharer will be more likely to use the product again, and the receiver will be incentivized to use the discount.

It’s a very popular method of creating a viral loop as it offers a great return. Uber is one of the more well-known companies that is doing a bang-up job of using this method. Dropbox, again, is also a great example of a company using the savings-driven viral loop.

Goal-Driven Viral Loop

This is based on the idea of the “twofer.” If you are going to get one manicure, there’s a good chance you have a friend, or maybe two or three friends, who might want to go along with you for a two-for-one or three-for-two discount or some variation of that. Think of Groupon and other sites that offer group deals.

Value-Driven Viral Loop

A value-driven loop incentivizes users based on offering them some value for using the product. If you share a $10-off coupon with a friend who uses it, then you earn $10 back in store credit. That way, users are not only sharing the news about how much they enjoy using a product, they are also offering something of value to new users.

Social Causes

Many businesses are interested in giving to social causes and are doing so by making grandiose gestures and public proclamations that loop their customers into the cause. The user is then incentivized because a portion of money that is spent is donated to charity or some worthy organization or idea.

This one-ups the coupon idea because many users will have less spending guilt if they know 10 percent of their money is going to charity than if they are getting a 10 percent discount on what they are spending.

These different forms of viral loops are proliferating like crazy. YouTube has one of the original, and best, viral loops. When you visit their page, you see an embedded video. If you dig the video, you can copy the embed code or share with your friends.

If you don’t like it, there’s a whole slew of other videos calling out to you to watch, and a good chance that you might want to share one of those. This loops on and on through generations of users until, BAM!; a multimillion dollar business is born.

Build Your Own Viral Loop

These days, there are gigantic companies whose business models are based solely on viral loops. Building your own viral loop might seem daunting, but it doesn’t have to be. The initial phases of setting one into place is the most important part, and after that you can sit back and watch your number of users grow and the cash roll in. Is it really that simple, you’re asking? Well…yes and no.

The first choice you have to make is to decide where people are going to enter your viral loop. Is it through email? Facebook? Blogs? Twitter? You want to make it as easy as possible for people to get into the loop; making it difficult for folks to integrate will be the death of your business.

You also want to make sure that your message is the right amount of in-your-face meets playing-it-cool. This is a difficult balance to strike and the most challenging hurdle for most companies.

Once you’ve chosen your entry point, the next step is the design of your loop. It’s best to keep it short and sweet. You don’t want to overwhelm your user with dozens of pages of information, so try to hone it down to 2-3 pages, tops. Testing in this phase is critical because it will give you valuable information about whether your users are dropping off and where, and insight into how to optimize each step/page.

At this point, you’ll want to decide what your viral hook will be. Essentially this refers to what it is that gets your user excited about sharing your product. Widgets, music, avatars or other things that can be highly personalized always offer more incentive to users to make them stoked about putting your app on their homepage.

The final step is to put on-ramps to your loops in place. This means looping in your homepage, advertising, SEO and so on, to make sure that users have a way of finding out about your loop and becoming a part of it.

This is the basic gist of a viral loop. The best way to understand them is by going through the motions of viral loops with as many different apps and programs as you can. Try MySpace, Facebook, YouTube, MailChimp, Uber, Yelp, Living Social, Groupon, Dropbox and as many others as you can think of. The process will help you break down the exact steps and ideas being used to get you from initial entry to the share factor.

There are certain characteristics of a viral loop that can help ensure its success. Free viral loops work much better than ones that involve a payment of some kind. Keeping concepts simple is always more efficient than complex concepts. Having a system in place where the users actually create the content means that it has built-in viral ability.

Basically, the important thing to do at this early stage is to conduct lots of user testing in order to ensure that you are getting the most user feedback and reviews in each step of the process. This will help you determine precisely which characteristics are helping or harming you in making your message viral.

Publicizing reviews and input from real users will help bolster your viral loop process during the phase where people are deciding exactly what to buy and if they are making the right choice in buying it. These steps come later in the process, after your company has built a name for itself and established a reputation. Every company has its own philosophy about what works best, and it varies across industries.

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