Sure, there will be those who take whatever is free and run away with big smiles on their faces; that’s inevitable. But there will also be a significant amount of consumers who will take what is free and buy more products from the company or website–such as the buy two get a third free method.
Fast food restaurants do this with cheap food–how do they make money on 99 cent hamburgers or tacos? They don’t. But they make profit on sodas, fries, desserts, etc., that they bank on consumers buying along with the dollar deal. This method can be applied to anything for sale, and anything online, such as Amazon’s Kindle and CreateSpace programs where publishers will offer a free print or ebook, or CD or DVD, with the purchase of one or more product at retail.
In light of the debate of free stuff online, Google has announced an update a little-known program it calls First Click Free, which allows publishers to index their subscription-based content then enable users to see the first page of the paid content for free. Publishers can now limit users to no more than five pages per day without registering or subscribing, limiting poaching by entering a paid site through several different searches. Users who click on more than five articles from a publisher in the program may now see a registration page, requiring the user to subscribe.
This is just one nifty method of analyzing how consumers react to free product.
We have emphasized the notion of “but is it free?” to clients for some time now, as we watch the trends. That trend right now, especially in this current economy, is that free is cool, free is sexy, free attracts ROI.
We all like free things. Free makes us feel warm and fuzzy, and makes us return to the product/brand that gives things away. And then we spend. It’s a simple but effective psychology.