Monday, July 03, 2006

A great Israeli success story is ICQ.
The name is a
oronym (wordplay) on the phrase “I seek you”.

In case you are interested, ICQ is an instant messaging computer program that allows allows the sending of text messages with offline support, URLs, multi-user character-by-character chats, resumable file transfers, SMSes, greeting cards and more.
Other features included a searchable user directory and POP3 email support.

In 1996, four young Israelis Arik Vardi, Yair Goldfinger, Sefi Vigiser and Amnon Amir started a company called Mirabilis with ICQ as their flagship product.
Yossi Vardi, the father of founder Arik Vardi funded Mirabilis when no others would touch it.
He travelled frequently promoting Mirabilis and was known for publicly stating the
company's revenue goal was zero.
This was intentionally - the company’s CEO often stated that the company did not have a plan for revenue, since large revenues would come later in the form of advertising revenues, upgraded services and back-end selling.

Their marketing concept was unique:
viral marketing.
Mirabilis depended on the users to spread the word about the product.
This way, friends would encourage their friends to join so they could communicate to each other. This established a powerful network effect as prospective users strongly preferred the system where their friends were likely to be.

Mirabilis made sure that it was very easy to spread the word.
For example, they used standard e-mail to invite friends to join, but also software instructed to scan address books for sending all recipients invitation letters.
In contrast to competitor
MCI, Mirabilis stayed away from telemarketing and never contacted a potential user during dinnertime.
As a result, they were the first mover into the market and gained a large market share rapidly and at a low cost.
This lead to the ultimate dream – they were bought up by
AOL for $200 million.
AOL keeps the viral marketing philosophy going.

To quote
Ted Leonsis of AOL in Newsweek:
The less you do, the more it grows”.

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