The Viral Startup: A Guide to Designing Viral Loops

Let's take an example where you're a photo-sharing site, and you need more people to upload their pictures. Local maxima could be reached by doing things like:
A/B testing your upload page to make people more likely to upload
Delivering a ton of email notifications prompting users to upload
Using switch-and-bait tactics like information-hiding, creating false incentives, etc.
Creating a gimmicky points system to upload photos
In many cases, I feel like many Facebook apps are trying to solve their problems by enacting the solutions as above. I think the quantitative side lends itself well to the above approaches, yet you rapidly hit diminishing returns.
Compare this to much harder (but higher payout) approaches like:
Repositioning the product for a higher resonating value proposition
Going after a different kind of audience to target their needs
Recalibrating the "core mechanic" of the product to make uploading photos a natural part of using the product (like HotOrNot, for example)
These qualitative approaches are much higher risk, because you can't collect significant amounts of data to validate your responses. You end up doing lots of user interviews, conducting ethnographic studies, and other methodologies that generate lots of data, but it's still up to you as the entrepreneur to figure it out. Not easy!

That means you are ultimately focused on one issue only:
Do something that’s REALLY easy to spread to other people
In this case, you are focused more on the mechanism of viral transmission than you are the content of what you are transmitting

Viral branding
Most people, when they talk about viral marketing, are in fact talking about viral branding. That’s the philosophy of: do something REALLY cool and people will tell all their friends

Refine: Stage 5
If your optimization step was successful, your work is probably not done. The final step is polishing your viral loop.
This includes figuring out issues like:
Making your loop as user-aligned as possible
Building a pleasant user experience and removing unnecessary flows or page elements
Refactoring the code to move it from prototype to production
Integrating it into your core product in a way that makes sense

Implement: Stage 2
The next stage is the rapid development of the core viral loop. This part should hopefully take days or weeks, not months

How does this viral loop fit into your core product?
What is the fundamental value proposition you are presenting to your users?
If your loop is successful, will users transition to your core product or will they bounce when reaching the switchover point?

Strategize: Stage 1
The first stage of a viral loop is developing the core strategy around the loop. This requires the viral loop designer to think through, step-by-step, how a user will come to find their product and how they will ultimately pass it along to their friends

define the viral loop, you can think of it as the steps a user goes through between entering the site to inviting the next set of new users.

Instead of:
“We have product X, how do we virally spread it?”
… we ask:
“We have viral loop X, what’s the right product to put into it?”
Once you have that question in mind, it becomes a lot easier to start brainstorming compelling experiences that might be inherently viral.

Successful viral products don’t have viral marketing bolted on once the product has been developed. It’s not a marketing strategy. Instead, it’s designed into the product from the very beginning as part of the fundamental architecture of the experience