We started the series by talking about What's a Viral Loop? and saw examples of successful viral loops. Last post we covered How it Works in the most basic form of a viral loop.
In this post, we are going to cover the most important part of the viral loop - the viral coefficient.
Viral Coefficient
Let's go back to our viral loop diagram to understand how we can calculate the viral coefficient.
The viral coefficient refers to number of new users acquired for each of the existing users passing through the viral loop. For example, if 1 user enters the viral loop, sends 10 invites to their contacts, and 1 of those contacts accepts the invite and becomes a new user, we would have a viral coefficient of 1 or 1 new user acquired.
x = 10 invites
y = 1 new user / 10 invites = 10%
v = 10 x 10% = 1
If more than 1 contact accepts the invite (let's say 2), then the viral coefficient would now be 2 or 2 new users acquired.
x = 10 invites
y = 2 new users / 10 invites = 20%
v = 10 x 20% = 2
The viral coefficient is the key performance indicator you can use to measure the growth provided by your viral loop. In fact, once you know your viral coefficient, you can quite accurately predict future user growth. In the next post we will talk about the viral coefficient relates to viral growth patterns.
What's your Viral Coefficient?