freemium business models, I talked about how customer acquisition investment ROI is amplified when you can leverage the inherent social aspects of the problem your product solves. I think of this as recruiting your customers to be your "marketing agents". Customers become marketing agents when they are doing the heavy lifting to attract new people into the product experience.
A customer's advocacy is far more effective at driving action than anything marketing can do by itself, so this approach can be highly efficient. Plus, the investment made to acquire that first customer can be spread across all of the people they eventually bring in -- increasing the effectiveness of ALL of your marketing investments.
While it is not easy to make this happen, there are some straightforward rules of the game.
Leverage what is social about your product
Your product's experience must take advantage of the social, viral behaviors inherent in the problem it solves. Stay focused on your customer's problem, remembering that social happens whenever one person shares an experience with another person and that social is not just Facebook, Pinterest and Sh#t Silicon Valley Says meme videos. Understand how people interact together in order to address the need today and insure your product experience takes this into account.
Lower the bar to sign up
It must be drop dead easy to sign up. No one wants to inconvenience their friends/coworkers, so they will not invite others in unless their own sign up experience was friction-free. Spend the time to optimize that experience and it will absolutely pay back with increased viral growth.
And if you utilize social sign up (and you should), make it clear what data you will be accessing and that you would never post or share without their permission. Users like the ease of social sign up (not another user name and password to remember!) but fear having their privacy comprised or unwittingly spamming their friends.
Make the free experience valuable
It's not enough that you make it easy to sign up. All new sign ups must quickly see the value provided and, ideally, personally feel the benefit. This is especially true for those users who are invited in by other users. Invited-in users are influenced by their relationship with the person who invited them to check it out, but their tolerance for any speed bumps in the getting-started process is lower so their 'time to value' needs to be short and sweet.
And when they experience the benefit, it is positive feedback for the user who invited them in because his experience just got better. And with positive feedback he is that much more likely to continue to being your marketing agent.
Activate, activate, activate
A solid nurture and engagement strategy is another necessary element for success. You must encourage adoption of those product features that best address the user's need and which benefit viral, word of mouth sharing. In-product, triggered messaging as well as email and social channels must all work together to make it happen.
The benefits of turning your customers into your marketing agents are significant and worth the investment of your and your team's time. You'll be a hero with your CEO and CFO as well as in your customer's eyes.