K-factor (marketing)

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In viral marketing, the K-factor can be used to describe the growth rate of websites, apps, or a customer base.[1] The formula is roughly as follows:[2]

i=\text{number of invites sent by each customer } (e.g. if each new customer invites five friends, i = 5)
c=\text{percent conversion of each invite } (e.g. if one in five invitees convert to new users, c = .2)
k = i * c

This usage is borrowed from the medical field of epidemiology in which a virus having a k-factor of 1 is in a "steady" state of neither growth nor decline, while a k-factor greater than 1 indicates exponential growth and a k-factor less than 1 indicates exponential decline. The k-factor in this context is itself a product of the rates of distribution and infection for an app (or virus). "Distribution" measures the average number of people a host will contact while still infectious, and "infection" measures how likely an average person is to also become infected after contact with a viral host.[3]

References[edit]

  1. ^ Fong, Richard (17 March 2014). "The K-Factor: The Secret Factor Behind Your Company’s Growth". Bliss Drive. Retrieved 26 May 2014. 
  2. ^ Skok, David (6 December 2009). "Lessons Learned – Viral Marketing". For Entrepreneurs. Retrieved 26 May 2014. 
  3. ^ Lee, Yee (15 January 2008). "The Four Viral App Objectives (a.k.a., “Social network application virality 101″)". FrameThink. Retrieved 26 May 2014.