Skype
Being an international student requires a lot of searching on the web, or simply reading through some of the IT magazines about the best way to communicate with family and friends that have been left abroad. I do not even know how I found out about Skype, but I was extremely happy about this discovery. I have been using Skype for five years and it helps me with the updates of the events that happens in my circle of friends.
After reading “Naked Conversations” I got really interested about Skype’s development through the years and the steps they had to take to become the most popular internet telephone survey in the world.
Skype uses word to mouth method to put themselves out into the market. Skype also uses similar tactics that ICQ used back in 1996. One of the ideas that Skypes uses from their competitors was “tell-a-friend’, which I thought was a very interesting idea.
“Whenever a new IM software version was ready, they’d contact 1,000 randomly selected users, giving them each the same “secret password,” and urging each to reveal it only to their two best friends” –Naked Conversations
By doing so, Skype made their customers feel that they were the part of the company, more like an insider and the part of something big that was about to happen. Instead of telling the “secret” to only two friends, word spread out fast, putting Skype at a 30-million-user mark. Big, did happen, everybody loves Skype, and everybody is waiting for new innovations. The method that Skype used to promote was quite unique. There were fractions of pennies spent on each customer, comparing to a 125 dollar that was spent to acquire new customer for a wireless telephone carrier. Skype is extremely efficient for those who use it and has proven to be very profitable for it’s investors.
5 comments:
seems like an interesting way to market to customers...these days with blogs and the entire internet I see a lot more companies who save millions on advertising. this seems to be great for business but is it put advertising companies out of business? Or do you think the effect isn't that great?
It is interesting way to market, however, the implication I think is that how open system pays off. Metcalfe states, "The usefulness of a network increases with the square of the number of users connected to the network." Skype is free in service and marketing fees, but surely company is benefiting by spreading thier system and by increasing thier value of system. This is interesting business.
In addition to the "two-friend password scheme" being a great marketing tool, it's also a really interesting social experiment. I'd be really interested to read about it from an organizational behavior/psychology perspective. I think it's pretty genious that they devised a strategy like this--exploiting the consumers by a behavior they were anticipating would happen--which is what marketing is all about.
While it seems like an intersting tactic to simply use word of mouth as a means to advertise. While the differences in the amount spent per customer is drastic, I don't think that Skype has nearly the same exposure as the typical cellular company.
Ryan
I do not think that advertisement companies will run out of business completely, but i feel that blogs are really effecting ad business, i think that companies want to vary their advertisement approach, i doubt that companies only will rely on blogs..
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