“We’ll Worry About That Once We Hit Critical Mass…”
. . . is a totally asinine thing to say when making a decision in regards to your product. It’s a completely vague marker and nobody really knows when it has been officially reached.
So what is critical mass?
The official definition is, “the smallest mass of a fissionable material that will sustain a nuclear chain reaction at a constant level.”
However, most people use this label as an excuse to say, “later on . . . when we get bigger.”
This is incredibly ambiguous, and just a smarter-sounding way of procrastinating.
So if you’re goal is to do as little as possible while giving off the impression you’re doing as much as possible, KUDOS! You’re on the right track. For everyone else though, who’s looking to successfully bridge the gap between viral marketing and business right from the start (which is the topic of this section), there’s a far better way to be using this term.
When Critical Mass Makes Sense
In some cases there actually is some validity to the use of “critical mass.”
Namely, when it refers to a situation where the dynamics or issues facing a new product will change after a certain base number of users.
For example, if you’re a user-generated content site with no users, you’ll therefore have no content. If you’re an online forum with no users, you’ll have no activity or forum topics with discussion. If you’re a closed-system communication tool – like the telephone – and you have no other users using that system, your tool has no value.
Imagine you’re the only person in the world with a telephone and there’s no one to call using it? What a sad thought. Not to mention that phone is completely useless now.
This last example describes a phenomenon called Metcalfe’s Law.
Understanding this concept can go a long way towards understanding your business strategy.
Metcalfe’s Law, Explained
Metcalfe’s Law states that the value of a telecom network is proportional to the square number of the connected users of the system. It applies to telephones and the Internet, and everything in between. For our viral purposes, we’ll concentrate on how it works for users within the latter online network.
In short, for closed-system networks where value is driven by user interactions with each other, the system with very few users is worthless. Here’s why:
- It is worthless in terms of the monetary value of the owners.
- It is worthless for any new user to begin using it as they won’t be connected to many others and therefore won’t be able to derive any core value from the product.
In these situations, critical mass can be a helpful indicator of the moment when the core value for new users joining is automatically high enough to transform the main problem of “why would a new user join” into “where can we find new users who haven’t already begun using the product.”
But how will you know when critical mass happens? And when it happens for one user in one place, will it automatically happen for everyone everywhere?
Probably not – and this is important to realize.
Overcoming Too Few Users
For products that are subject to Metcalfe’s Law, the hardest days will be the early days. This is when you’ll need to brute-force your way through some tough times by doing things that don’t scale.
- Reddit initially created hundreds of fake user accounts and conversations to make the site appear more active – and therefore more valuable – than it actually was.
- Skype spent considerable time and resources making the product stupid-simple to use and invite others. They eventually got creative by targeting marketing efforts of their free worldwide VOIP service to countries who had monopolistic long distance telecom carriers that charged crazy-high rates. This led to a significant increase in the virality in that region.
- WhatsApp took a similar approach to Skype, but focused on using the Internet to mirror SMS and MMS messaging without the fees that carriers used to be able to get away with charging. All by simply replicating the routine experience of text messaging, but adding in better features (like video messaging and group texting) and rapidly offering service to virtually every cell carrier. Because of the dramatically lower cost and zero-ad approach maintained by the company, international and third world traction became a key driver.
In the cases above, “critical mass” can be considered reached when > 75% of users in a market have enough friends already using the product that they do not need to invite others to derive ongoing core value.
Reaching Your “Critical Mass”
You can do your best to estimate the moment of critical mass, but a blanket approach will be tough. More than likely you will find that while pockets within each geographic area and user segment hit “critical mass,” there will be others who basically remain untouched. Quantifying at what point this happens will be very helpful as your business moves forward. (Like when a user joins, already has 8 friends using the product, and therefore is retained 90% of the time after 30 days without inviting a single additional friend.) Reaching this point typically results in a change in marketing strategy, shifting your main efforts away from that specific market towards targeting less saturated segments.
When this takes place, the activity of some users will also in turn drive the reactivation and retention of others who would have gone dormant otherwise. These user-driven retention efforts ensure your product never risks retention tactics that feel “spammy.”
In other words, critical mass can help you determine when and where it’s the best time to grow. Hopefully preventing you from dumping time, resources, and money into areas that won’t provide the most bang for your buck.
From one vague phrase to another. Let’s take a look at a concept that’s used wrong even more often and to a greater detriment than “critical mass.”
Because while misusing critical mass might lead you to waste some time and money, not properly understanding this next term could outright kill your company.
When is Your Company at Scale?
You might not realize it, but this is actually a trick question. Companies, especially startups, love to throw around the term “scale” without ever really knowing what it means. So in our next chapter let’s attach some viable meaning to the concept so your company doesn’t get crushed beneath it.
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