Viral marketing acts like a virus -- spreading itself and multiplying exponentially.

Asking whether viral marketing is practical is like asking whether it’s possible to do any kind of marketing at all. Any kind of marketing strategy, from viral marketing to pay per click to search engine optimization is practical if you are able to do it correctly and you have a bit of luck.

Okay, now that we’ve got the basics out of the way, let’s examine what viral marketing is and why it can be practical but often isn’t practical.
Viral Marketing Defined
Viral marketing, at its most basic involves getting others to do your marketing for you. Rather than having to get your message everywhere by paying for it, people tell their friends about your product or service and they tell their friends and so on and so forth. If it sounds simple, that’s because it is.
The concept works in exactly the same way that a virus works – one person keeps it while passing it on to the next person, who passes it to still more people. The catch however, is that unlike a virus, you need people to consciously choose to share your product or service with their friends and or family. And that is one of the two problems with viral marketing.
Getting People to Share Isn’t Always Easy
In a world where we are inundated with new ideas every day, getting people to share an article, a video or a product isn’t the easiest thing to do. Your idea has to be something that is truly unique and which will have wide appeal.
The classic example was Hotmail, which started out giving away free e-mail accounts at a time when few others did. The product became popular, especially because Hotmail appended a message to every e-mail they sent out for you saying “get your own free Hotmail account at”
Hotmail then had the two things that make a product go viral – it was a valuable product that people could get for free (free is always the best way to do viral marketing) and it was something people would naturally share in a passive manner because they were e-mailing their friends with their shiny new Hotmail account.
However, when you have a video or a product that needs to be downloaded (or an article), it’s a little harder because you don’t have that passive spreading of your “virus.” People need to actively choose to share it, which makes the threshold required to go viral that much higher. Not impossible to achieve, but more difficult (of course, you can make it easier for them by providing the tools to allow them to share, but it still takes a conscious decision to share on the part of your users).
Scalability is Important as Well
The other thing that makes viral marketing something which is not always practical is scalability. There are over six billion people on the planet and if even 1% of them all decided they had to have your product, would you be able to manufacture it fast enough to give it away?
Or, if you are giving away software or a video or article (most likely for viral marketing today), are your servers able to take a pounding if hundreds of thousands of people suddenly start clamoring for whatever it is you are giving away? If they can’t, then viral marketing will not be practical in your case either.
Bottom Line
Bottom line, in order to make viral marketing practical, you need to find a product or service to give away which has real value and which people would want to share with their friends. At the same time, you need to create a product or service which can easily be scaled upwards to meet demand if your product does go viral.
So, yes it’s theoretically practical. In practice however, viral marketing is tricky at best.