Giving for Free - Strategic or Silly?

Annie DiMatteo - 11.17.2009 9:00 AM

You always hear people say, "there's no such thing as free..."  While this may be true in some cases, there are a multitude of exceptions to this antiquated rule.  When you're in business, sometimes giving things away for free is beneficial.  In fact, many times, giving something away for free can actually save you money.

We are fast approaching a time where the consumer expects to get a lot for free.  iPhone apps are free, blogging is free, consuming blog content is free, consuming online newspapers is free, tv shows and songs can be downloaded for free, you can chat with your friends worldwide via Skype for free, or via IM for free, MySpace, Facebook and Twitter are all free social networking platforms...etc. etc. etc.  The idea of "no such thing as free" is coming to a screeching halt.

In a world where consumers expect a lot for free, is there anything wrong with appeasing them?  There are many situations where free is actually good:

Free Knowledge
Always, always, always give your advice and knowledge away for free.  In this day and age, people have full access to all information in the world, so you might as well make your share of knowledge freely available as well. If you don't, your audience will probably bypass your costly information for that of the readily available free information anyway.  An added bonus to this is that when you are the one giving the information on a subject, you in turn become the authority on the subject.  You are now the expert that people turn to for information - what a great place to be; priceless in fact.

Free Samples
Go shopping at Costco on a Saturday, and tell me what the best part of your trip was - all the free food samples?  Costco knows that giving away free samples is a great way to introduce consumers to new products, or to products they want to promote.  It is a great way for the consumer to try something they are unsure of, and in situations like this, it usually results in dramatically increased sales of the "sampled" product.

While I was shopping at L'Occitane en Provence a few weeks ago, I came across a similar situation.  I purchased a small bottle of perfume, and while I was checking out, they loaded up my bag with dozens of free samples of great new skin and face products.  I was thrilled at the idea of getting to try so many of their products for free!  These were products I would have never considered purchasing or trying before, but because they were given to me for free, they now got me to use more of their products.  Just being able to try the product increases the chances that I will like it, and return at a later time to purchase that product (which did happen in this case.)

Freebies
I went on vacation to Mexico this summer.  As I arrived at the hotel, I stepped out of the cab (family in tow), and we were immediately approached by the hotel staff, handed a cool towel and a frozen drink.  How fabulous!  What a fantastic "free" way to start my vacation!  The fact that this hotel was smart enough to proactively give away these items for free was a smart move.  It set the tone for the entire vacation, immediately put us all in great moods, and made us more willing to spend money (and give larger tips) later on.  What's more - I told at least ten of my friends about what a fantastic hotel it was - great word of mouth recognition!  All for the cost of some free drinks and towels.

Free Shipping
Free shipping has pretty much become the expectation for me.  In fact, when I go to a Website and they want to charge me for shipping - it actually makes me a little upset!  At this day and age, shipping should be free (in my possibly biased consumer opinion.)  People shouldn't have to pay more to be able to shop online.  At the very least, shipping should be offered for free once a certain minimum spend is reached.  This not only makes your customers feel they are getting what they rightly deserve (free shipping), but it incentivizes them to spend "just a little more" so they can qualify for free shipping.

"Free" makes your customers feel good, and increases the likelihood of word of mouth referrals - both great ways to generate more business.  The more you can give, the more you will get back in return.*

*Except your services, don't just give your work away - your work is valuable, and you should get paid for it.  Remember that leveraging "free" does not mean you give away the farm - your "free" must always be well balanced with your "not free!"

Please feel free to share your stories about "free" experiences you've had!
 

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