SaaS Cheat Code: Virality
When we talk about a SaaS product having virality, it means that every user you add has a viral coefficient greater than zero. You can count on each new customer bringing at least a fraction of a new customer within a particular time frame.
Some ways of achieving virality are stronger than others.
Strong Viral Loop. When the value of your app is in how it connects people, you have a strong viral loop. Take Facebook, where people who join tend to invite their friends onto the platform. Slack is the same way. It’s not useful if you’re on your own, so when someone adopts the tool, they also generally invite the rest of their team.
In the above examples, people need to sign up for an account to use the product. But you can have strong viral loops even without that requirement.
When I send out a SavvyCal link to someone who wants to book time on my calendar, they click through the link and experience for themselves how easy the tool is to use. The fact that the link came from someone they know is a tacit endorsement. When they want to try a scheduling app themselves, they’re already inclined to trust SavvyCal.
Electronic signature apps have that same built-in virality. When you send your SignWell link for a colleague to sign a document electronically, they are exposed to the experience of using it and may be inclined to choose it next time they have a document that needs a signature.
Weak Viral Loops. Making your brand visible on customer-facing interfaces is another form of virality.
When Drip customers on certain low-price plans put an email sign-up widget on their website, anyone who sees the pop-up also sees the words “Powered by Drip.” If they’re in the market for an email widget for their own website, they might check out Drip.
A lot of SaaS tools require branding or watermarking as part of their free plan. For example, Mailchimp adds a badge to the bottom of every email sent through their free plan. Veed.io, a video editing tool, adds a watermark to videos made with their free plan.
The first reason these are weak viral loops is that, even though they get your brand in front of potential users, it doesn’t create as strong a bond as when someone interacts directly with your product.
The second reason is that if someone is interacting with your product because they were invited (like in the Slack example), they’re probably closer to the target audience than someone who’s just on a mailing list or watching an influencer’s video on YouTube.
Building Virality. Although this SaaS Cheat Code can be incredible for growth, it’s extremely difficult to retrofit virality into your product. If you want to build a viral product, start from the beginning and actively pursue the business ideas that lend themselves to strong viral loops.
The good news is that you can absolutely build a SaaS company to millions in revenue with a zero viral coefficient. Virality is amazing when you have it, but it’s not a deal breaker for building your company.
A Quick Note on Vanity Metrics
Sometimes you’ll hear a founder bragging about getting 50,000 unique visitors a month to their website, getting 100 new free users a week, or having 25,000 people on their mailing list.
Those numbers sound impressive until you dig deeper.
How many of those unique visitors convert to trials? How many of those trials convert to customers? What’s the open rate on that mailing list?
Vanity metrics like page views, subscribers, or free users are interesting, but only in context. The real question is: how many of those visits or free users are turning into paying customers?