Question

Topic: E-Marketing

Internet Viral Marketing-- Name For This Strategy?

Posted by Anonymous on 5/3/2006 at 1:45 PM ET 125 Points
It seems that many companies these days are offering their web-based services for free (or nearly free) in an effort to get thousands or millions of users (i.e. kazaa/napster/skype) Then converting to a paid subscription model, selling their user list, or cross marketing other products/services. What is the name for this approach? and are their articles written about it's effectiveness?

Thanks
TJ
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  • Posted by Peter (henna gaijin) on 5/3/2006 at 3:40 PM Accepted
    The Internet bubble was based around this approach (though most companies never figured out how to make that second step of getting money out of the "eyeballs" they were getting). This has also been called Web 1.0, where those now actually making a business out of it are often called Web 2.0.

    MarketingProfs uses this model to an extent (though selling advertising is also part of their model, and I am not sure your question reflects the model of getting users and supporting their free service with advertisement).
  • Posted by ReadCopy on 5/10/2006 at 1:49 AM Member
    Most businesses start off this way, some business stay small and contained, and can sustain some sort of free offering.

    Look at Google, free search, free listings, but you pay for more advanced promotions.
    MOST consumer product starts cheaper than recommended retail price to allow consumers to try it first.

    One of the core problems with Skype right now is that with 5m+ users, they keeps the entry cost low/free to attract users ... but then it is faced with ongoing customer support problems which does cost money.

    Whats this approach called! Not sure, when I went to college it was called Penetration Pricing, but I'm sure there is a sexier dot com name for it now :-)
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