Is there a name for this type of business?

RGBoston·Oct 31, 2020

Posted in:Tech

Hi - wondering if there is a name for a type of business when by a customer using it, others learn about it and experience it and become potential future customers. For example, Zoom. When one person uses it (holds a meeting), and invites others to attend the meeting, the attendees learn about it/use it/experience it. I am not just talking about something viral - any product can get attention and grow virally. And I'm not talking about a company that becomes more valuable when more people use it, like Facebook or Waze.Is there a name for this type of company?Thank you!

teresaman·Oct 31, 2020

I'm not sure if there's a name that defines this type of company, but it's definitely a growth tactic through "casual contact" (in which you're Indirectly attracting other users through their usage of the product). For example, you fill out a Typeform and at the end the CTA is for you to make one yourself.

Iynna·Oct 31, 2020

Word of mouth? Indirect referral? which is not a business per se but a subdivision of a business model.

samwinkler·Nov 01, 2020

Hi! The dynamic you are describing is called network effects. Many of the strongest most defensible businesses have these

arielleshipper·Nov 02, 2020

2 other business model observations here:- Freemium: Folks experience the product for free and are incentivized to upgrade by usage and/or feature limits.- Land and expand: Zoom is kind of a blend of B2B and B2C (at least in this pandemic landscape), but in the B2C world some coworkers might start using Zoom to communicate and pull others in. Because it's free a small sub-section of a company might start using it (land) before the whole team (expand).