Everything everywhere is FREE! Is this just a marketing gimmick?As my father would say: “Free but who pays?”
In the old world of physical product, if something is free then someone will pay in the end. Most FREE offers are actually the old ‘bait and switch’ strategy.
One way or another it is you that will pay for the free product.
In the new world there is a real free – the marginal cost of storing and distributing digital 'product' is negligible so it can be given away for free with no-one paying for it.
My kids can use computers given to them with a phone contract… they use free mobiles (so the operator makes money on minutes sold) and use Google (free) and Skype (free), Wikipedia (free), Flicker (free) and FaceBook (free) to find out about everything they need.
There is an unwritten assumption that you should give things away for free ("because the competition do..."). Is that right for you? A free healthcheck... a free test drive... a free audit...
For some businesses the "giving it away for free" approach may send out the wrong message.
On the other hand the consumer loves the TBYB (Try Before You Buy) philosophy. Some consumers will feel more likely to buy because of the moral contract created. Some will be free-loaders. It all depends on what you think is the best way to capture the best clients for your business.
Should you be giving anything away at all?
Or should you be giving more away than you are doing at the moment?
Are you clear about what you should be giving away and why?
8 comments:
As said before - you get what you pay for. As long as you understand the deal then that's fine.
Bonnie
We used to do free healthchecks and website reviews as a way of getting people to talk to us. We had numerous conversations with people who just wanted the free stuff and never intended to buy.
We now charge £500 which will be discounted if they proceed to buy from us.
The result is a better quality of prospect and less time wasted. A big result.
Tim C
I don't get the giving away bit. We run a laundry service (in the SW) for restaurants and hotels. Very price competitive but there is an understanding that you get what you pay for. We have cut prices to win business but in the long run it doesn't work for us. If only it was so simple. At the end of the day we don't want the sort of business that is obsessed with price.
Tony P
Free sucks you in. Which is great. And then it gets you to buy something that you hadn't considered buying.
e.g. Last.FM plays you songs like the ones by your favoutite artists and then it offers to sell you the download of the new songs that they've introduced to you. All for 99p or similar.
And if you multiply the number of sales time 99p you suddenly get a big number.
I am happy to use last.fm as their cost to me (a few ads) isn't unbearable. I am not happy to pay for havng the ads removed (eg spotify.com) and all I've done is make it clear what I am happy to pay for.
Seems like a win-win to me. I get access to loads of stuff I wouldn't normally come across - they do the hard work of showing it to me. I buy what I like. And even if the system has to accomodate some free-loaders well they'd have found a way to do that in any case.
Madge
We have always done a free health check or business audit to give potential clients a Try Before You Buy - your idea Mr C! And now you are suggesting that we should charge for it? Well the answer is Yes and No.
Yes we should charge. We are fed up of getting time-wasters simply coming along with no intention of buying so charging would scare them off.
No we should not charge because there are some people who would never have tried us had we not offered it for free.
We do not have the luxury of running big events like you do. We do not have the budget to run our own. We also do not see enough prospects to be able to risk turning any away.
So in principle I love the idea but in reality I am bit of a coward. Am I alone?
JM, Independent Business Consultant, London
I don't want to be free. Not ever. I am very expensive.
Stevie
We have always done a free health check or business audit to give potential clients a Try Before You Buy - your idea Mr C! And now you are suggesting that we should charge for it? Well the answer is Yes and No.
Yes we should charge. We are fed up of getting time-wasters simply coming along with no intention of buying so charging would scare them off.
No we should not charge because there are some people who would never have tried us had we not offered it for free.
We do not have the luxury of running big events like you do. We do not have the budget to run our own. We also do not see enough prospects to be able to risk turning any away.
So in principle I love the idea but in reality I am bit of a coward. Am I alone?
JM, Independent Business Consultant, London
As said before - you get what you pay for. As long as you understand the deal then that's fine.
Bonnie
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