Viral Loop: From Facebook to Twitter, How Today’s Smartest Businesses Grow Themselves

by Adam L. Penenberg 

ISBN-10: 1401323499
ISBN-13: 978-1401323493
Subtitle: From Facebook to Twitter, How Today’s Smartest Businesses Grow Themselves
Publisher: Hyperion

Here’s something you may not know about today’s Internet. Simply by designing your product the right way, you can build a flourishing business from scratch. No advertising or marketing budget, no need for a sales force, and venture capitalists will flock to throw money at you. Many of the most successful Web 2.0 companies, including MySpace, YouTube, eBay, and rising stars like Twitter and Flickr, are prime examples of what is known as a “viral loop” — to use it, you have to spread it. After all, what’s the sense of being on Facebook if none of your friends are? The result: Never before has there been the potential to create wealth this fast, on this scale, and starting with so little.

In this game-changing must-read, Viral Loop tells the fascinating story of the entrepreneurs who first harnessed the unprecedented potential of viral loops to create the successful online businesses — some worth billions of dollars — that we have all grown to rely on. The trick is that they created something people really want, so much so that their customers happily spread the word about their product for them. All kinds of businesses, from the smallest start-ups to nonprofit organizations to the biggest multinational corporations, can use the paradigm-busting power of viral loops to enable their business through technology.

Viral Loop is a must-read for any entrepreneur or business interested in uncorking viral loops to benefit their bottom line.

Read Excerpt…

PRAISE FOR VIRAL LOOP

— Publisher Weekly
In this clear-eyed collection of case studies, Fast Company contributing writer and NYU journalism professor Penenberg examines the engine driving the growth of web 2.0 businesses like Flickr, YouTube and eBay to Facebook and Twitter: the viral loop. The concept behind a viral loop is simple — in order to use the product, you have to spread it, thus creating massive, user-driven growth cycles — after all, Penenberg explains, social networks like Facebook are worthless to a user if one’s friends aren’t also using the products. Viral loops are nothing new, of course, and Penenberg has certainly done his homework, tracing the concept back through its analog roots via entertaining and enlightening anecdotes about companies like Tupperware, which used “parties” to turn ordinary housewives into an army of sales reps, to Charles Ponzi — yes, he of the Ponzi scheme, a viral scam recently taken to historic levels by Bernie Madoff. Penenberg truly succeeds, however, in showing how the viral loop has found its groove on the Internet, fueling a wave of billion-dollar companies all built on word of mouth — and, of course, user clicks. Solidly researched and briskly-written, Penenberg at once captures a great business and tech story, as well as a defining moment in our online culture.

— SmartMoney
After months of recession, tales of business growth are a welcome diversion. In “Viral Loop,” Adam L. Penenberg tells inspirational stories about companies achieving growth at such a phenomenal rate that you might be tempted to whip up your own business plan — or at least consult with your broker. In Penenberg’s case studies, small start-ups attract thousands of members or customers within days, illustrating the book’s focus: the “viral” loop in which each new customer winds up recruiting, on average, more than one additional customer. That circumstance — a “viral coefficient” above 1, as Penenberg explains — results in supercharged growth. (Readers of a certain age will recall the old television ads for Faberge Organic shampoo: “I told two friends… and they told two friends…”)

The case studies of “Viral Loop,” not surprisingly, focus mostly on Internet businesses that took the web by storm, such as Hotmail and Facebook. Though the details will be familiar to some, it’s a provocative time to assess the viral model at these businesses. As Penenberg, a writer for Fast Company and journalism professor at New York University, points out, the big viral success stories tend to provide free services that make it easy to get that viral loop going.

When it comes to paying the bills, these free services are typically hoping that advertisers will provide at least part of the answer. But as the book’s case studies show, assembling a mass audience isn’t the challenge it once was — meaning advertisers have more choices. Which raises a question for those eyeing the next big viral business: As the economy shifts into a recovery phase, how much are a million users really worth?

— Dan Heath, co-author of Made to Stick: Why Some Ideas Survive and Others Die
“If you want to understand all things viral, this is the place to start. Penenberg’s reporting gives us a ringside seat for some of the biggest viral success stories in history, from Tupperware to Ning.”

— Chris Anderson, author of Free: The Future of a Radical Price
“One of the most astounding things about the Web age is how the best advertising is often no advertising at all. Penenberg masterfully explains how this works with case studies of products that were designed to spread. Every product can use a dose of this technique; this is the book to get to learn how.”

— Seth Godin, author of Tribes
“In tight, engaging prose, Adam captures the essence of the ever-scaling power of the virus. It’s not just for geeks anymore.”

— Jeff Jarvis, author of What Would Google Do
“Penenberg discovers the perpetual motion machine for business and marketing… Buy this book. Catch a virus. Make a fortune.”

— Robert Safian, Editor-in-Chief, Fast Company
“Penenberg has unlocked the secret to the most successful digital businesses. An indispensable read.”

— Douglas Rushkoff, author of Media Virus and Life Inc: How the World Became a Corporation and How to Take It Back.
“Instead of entrusting your business to a guru with an agenda and a ghostwriter, you should be turning to a pro journalist like Adam Penenberg, who understands the way media and money interact, has the critical faculty to engage with these phenomena in an unbiased fashion, and the technical facility to explain them to you in an entirely engaging, informative, and actionable way.”

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