Viral coefficient
What is the viral coefficient?
The viral coefficient (K-factor) is the average number of new users each existing user brings in: invites sent per user times the conversion rate of those invites. If it is above 1, each generation of users is larger than the last.
Few products sustain a K above 1, but even a lower value reduces how much paid acquisition is needed.
Why the viral coefficient matters
It turns a viral loop into a number you can improve, by increasing invites, their conversion, or both.
Viral coefficient example
Each user invites 4 people on average and 20% of invites sign up. K = 4 × 0.2 = 0.8.
Related marketing terms
A viral loop is a cycle where using a product brings in new users, who use it and bring in more, such as invites or shared content.
Referral marketing rewards existing customers for bringing in new ones, for example with credits or discounts for both sides.
Conversion rate is the share of people who take a desired action, such as signing up, replying or buying, out of all who could have.