October 2012 Summaries

Measuring social distribution is crucial for understanding how many new users a product will attract after a new user joins. The k-factor is a key metric that measures this, with values above one indicating virality and below one showing limited growth. To improve the k-factor, it's essential to monitor four metrics: MUU, MAU, DAU, and pDAU, as well as three key ratios: MUU to MAU, MAU to DAU, and DAU to pDAU. Improving these ratios can increase engagement, encourage sharing, and ultimately drive growth. However, spamming or attempting to force distribution without a compelling reason for users to return will only lead to negative consequences, such as losing users and damaging the product's reputation. By focusing on retention and providing value to users, businesses can harness the power of social distribution to accelerate growth.

At some point every product owner wonders how to make their product go viral, as a thought experiment. Viral products are rare and sustainable businesses built on viral promotions even rarer. Even successful products like Dropbox had a viral factor below one due to various factors such as excellent product/market fit, daily usage, high retention, and incentivised sharing. Understanding the sharing mechanism is crucial, which involves a lossy process where not everyone shares, not every share is seen, and not every click results in a new user. This process must transcend devices, platforms, screen sizes, and more to be effective. Defining a clear sharing mechanism is key, involving identifying all meaningful shareable events in the product and sharing across multiple platforms, such as social media, to maximize reach and network effects.