Viral Loop - Quiz answers

What is this article all about?

Last Monday I shared a Quiz about the book Viral Loop here on LinkedIn.

The quiz has 10 questions about important concepts taught by Adam L. Penenberg.

?If you want to take it, click here .

And below you’ll find all the answers with the explanation for each question.

Question 1

Analyze the phrases below and choose the correct option:

i- It’s possible to create a multi-billion dollar business from scratch with no marketing budget or advertising

ii- Humans are hard-wired to socialize

iii- The more oxytocin swimming around your brain, the less other people trust you

a) All are correct

b) Only i is incorrect

c) Only ii is incorrect

d) Only iii is incorrect

Answer 1

Let’s analyze each statement:

i- It’s possible to create a multi-billion dollar business from scratch with no marketing budget or advertising

This phrase can be found on page 11, where Adam analyzes the success of HOT or NOT, a website that permits users to rate the attractiveness of voluntarily submitted photos created by James Hong and Jim Young.:

“As James Hong and Jim Young demonstrated, it’s possible to build a multi-million- or even billion-dollar business from scratch, simply by designing a product the right way. No advertising or marketing budget, no need for a sales force”

ii- Humans are hard-wired to socialize

This phrase can be found on page 72, where Adam analyzes the viral plain:

“What explains our BlackBerry-bearing, Twitter-tweeting, Facebook friend with the need for constant connectivity? As facile as it sounds, we do it because we are hard-wired to socialize. It’s in our best interests. One reason we gravitate toward communities is because they multiply the impact of each individual to bring greater prosperity, security, and fulfillment to all.”

iii- The more oxytocin swimming around your brain, the less other people trust you

This phrase is false, the more oxytocin, the more other people trust us. It’s also part of the viral plain explanation:

‘A research project by Paul J. Zak, a professor of economics and the founding director of the Center for Neuroeconomics Studies at Claremont Graduate University, found that when a test subject learns that another person trusts him, the level of oxytocin, a hormone that circulates in his brain, rises. “The stronger the signal of trust, the more oxytocin increases,” wrote Zak, whose primary interest is neuroeconomics, a discipline that attempts to gauge how the brain’s neurologic functions process decisions involving money. And trust, Zak learned, begets trust: the more oxytocin swimming around your brain, the more other people trust you.’

Question 2

Analyze the phrases below and choose the correct option:

i- Building viral hooks is the only thing needed to have a viral company

ii- Viral strategies can be used in politics and nonprofit organizations

iii- Viral business models started in Silicon Valley

a) All are incorrect

b) Only ii is correct

c) Only iii is correct

d) ii and iii are correct

Answer 2

Let’s analyze each statement:

i- Building viral hooks is the only thing needed to have a viral company

This phrase is incorrect. You also need something good, something people really want. Adam discusses this on page 13:

'And make no mistake: viral expansion loops are about marketing, just not the traditional sense. “Nothing can be truly viral unless it is good,” venture capitalist Wilson says. “You can create a crappy application, build viral hooks in it, but if it’s bad nobody will follow the viral channel and the company will go out of business.” But if you make something people really want, your customers will make your business grow for you.'

ii- Viral strategies can be used in politics and nonprofit organizations

Adam explains this statement in two moments.

On page 14:

‘Viral strategies aren’t strictly for business. They are also seeping into other arenas—like politics.’

And on page 17:

‘Viral schemes are not only applicable to politics and business. They are a natural for nonprofit organizations.’

iii- Viral business models started in Silicon Valley

This statement is inaccurate. Adam provides numerous examples prior to Silicon Valley companies. Here's a quote from page 238:

‘At our essence we are viral creatures. Creating viral-loop businesses is just a small part of who we are.’

Question 3

Why did Mosaic, the first company created by Marc Andreessen, make today’s web?

a) They conceived the internet

b) They seeded the internet with a navigation tool

c) They unveiled the protocols that made possible the World Wide Web

d) None of the above

Answer 3

The answer to this question can be found in two passages within this book.

On page 44:

“Today’s Web, with more than 1.5 billion users worldwide and almost 200 million websites, owes its existence to three men: Paul Baran of the Rans Corporation, who conceived the Internet; Tim Berners-Lee, creator of the World Wide Web; and Marc Andresseen, who figured out how to navigate it. In essence, Baran provided the land, Berners-Lee built the roads, and Andreessen manufactured the vehicles.”

And on page 54:

“By seeding the Internet with navigation tools, Mosaic and Netscape made possible today's Web—and there was no turning back.”

Question 4

What happens when the viral coefficient is greater than 1?

a) The company achieves linear growth

b) The company achieves exponential growth

d) The company achieves a point of nondisplacement

c) The company achieves a point of saturation

Answer 4

The answer can be found on page 56:

“[...]if the virality coefficient is 1, the start-up will grow, but at a linear rate, eventually topping out. Above 1, it achieves exponential growth.”

Question 5

What are organizational technologies?

a) Companies that grow exponentially until saturation

b) Companies that collaborate with creators to achieve virality

c) Companies that promoted freedom in human relations, business, and laws

d) Companies that provide an environment for users to fill with content

Answer 5

The answer can be found on page 60:

“[...]viral loop companies are a form of organizational technology. [...]These viral loop companies provide an environment that is, in theory, almost infinitely scalable, relying on the wisdom of the crowds to create or aggregate masses of material to fill it.”

Question 6

What characteristic below is not one shared by successful viral expansion loop businesses?

a) Scalability

b) Stackability

c) Simple concept

d) Web-based

Answer 6

Pages 67-69 provide the shared characteristics of successful viral expansion loop businesses. They are: Web-based, Free, Organizational technology, Simple concept, Built-in virality, Extremely fast adoption, Exponential growth, Virality index, Predictable growth rates, Network effects, Stackability, Point of nondisplacement, Ultimate saturation.

Question 7

Which shared characteristic of successful viral businesses blocked eBay from knocking PayPal off its payment pedestal?

a) Network effects

b) Ultimate saturation

c) Point of nondisplacement

d) Extremely fast adoption

Answer 7

The answer can be found on page 176:

“Soon PayPal was grabbing 70 percent of all transactions on eBay. Clearly it had achieved a point of nondisplacement, and nothing eBay did could knock it off its payment pedestal. Being viral, it grew simply because it had already grown.”

Question 8

Analyze the phrases below and choose the correct option:

i- Once a viral loop takes hold you can accurately predict how fast your user base will grow

ii- A company with strong control of its brand can find way to great, untapped riches

iii- Viral businesses are far better suited to the frictionless world of the internet

a) All are correct

b) Only i is incorrect

c) Only ii is incorrect

d) Only iii is incorrect

Answer 8

Let’s analyze each statement:

i- Once a viral loop takes hold you can accurately predict how fast your user base will grow

Adam explains on page 68:

“If a product is properly designed with viral hooks, it spreads at a constant rate—assuming there are sufficient numbers of people—and can be accurately forecast, in the same way epidemiologists can predict with some certainty how quickly a virus will spread through a city.”

ii- A company with strong control of its brand can find way to great, untapped riches

The opposite is true. Adam says on page 127:

'Procter & Gamble CEO A. G. Lafley once said in a speech at the Association of National Advertisers, "The more in control we are, the more out of touch we become. But the more willing we are to let go a little, the more we’re finding we get in touch with consumers." [...] a company willing to let go of its brand can find its way to great, untapped riches as Mentos did.'

iii- Viral businesses are far better suited to the frictionless world of the internet

This phrase is mentioned on page 67, where Adam explains the Web-based characteristic of successful viral businesses.

Question 9

What was the first observation of virality?

a) Earth

b) Tupperware

c) Mosaic

d) Hotmail

Answer 9

The answer can be found on page 235:

“[...]the greatest viral realm of all is Earth. And the modern, post-Internet definition of viral—a replication pattern transmitted from user to user—can even be retrofitted to describe how life took off on the planet. Because all life forms, where they are humans, wombats, or fire ants, are bred to spread. In essence, virality is imprinted into our DNA.”

Question 10

Who was the unlikely savior of Tupperware?

a) Earl Sila Tupper

b) J. L. Hudson

c) Theodore Roosevelt

d) Brownie Wise

e) Orson Welles

f) Charles Ponzi

Answer 10

The answer can be found on page 25:

“A lot has happened since the late 1940s, when Tupper’s business was in danger of being tossed out like a Chinese take-out cartoon, to today, when 90 percent of American homes own at least one piece of Tupperware and the company reports billions in revenue. [...] Tupperware’s unlikely savior was Brownie Wise, a single mother from Dearborn, Michigan.”

Conclusion

I hope these answers help you.

Thanks for getting here!