I love how Seth Godin defines viral marketing. It's a simple, straight-forward explanation, and it goes something like this:
Viral marketing is an idea that spreads--and an idea that while it is spreading actually helps market your business or cause. Because the currency of our future is ideas- the idea virus mechanism is how those ideas propagate.
His 12 year-old book on viral marketing "Unleashing the ideavirus" is still one of the most sought-after and relevant resources on the subject. You can read it for free here.
The fact is, technology is one of the best things that has happened to us marketers. Word-of-mouth has taken a whole other dimension. The Internet- with social media, emailing, blogging, IMing, etc.- has served as the ultimate slingshot for the faster spread of our messages.
Here's a pretty neat Infographic brought to us by ProBlogger and Voltaire that helps us understand the viral content marketing phenomenon. From its anatomy, types, reasons why we share, and how it all comes down to Metcalfe's Law, it's all there, so check it out: