The Marketing Implications Of Offering Free Products And Services

This article is a reminder about ‘free’ and the implications of what free means. As marketing or business people we know that offering something for free can be a useful hook to catch someone’s eye, or as a ‘sweetener’ for the deal. But it's also possible that we forget what 'free' means to the customer who reads and interprets it.

Let’s get straight to the point. Whilst offering something for free can be a entirely valid strategy, please don’t forget the following…

…there’s no value in ‘free’.

Let me explain.

By saying something is free, you are educating your customers that this free product or service has no value to you (as the supplier) so the customer should see no value in it either. What’s more – no one likes paying for something that was once free to them – so it’s unlikely that you will ever be able to charge for something that you once offered for free (at least not without upsetting a few customers, whether you know you’ve upset them or not).  So, once it’s free it’s likely to always be free, or you risk losing customer goodwill. In short, ‘free’ is a short term win, for a potentially long term lose.

Admittedly, I am generalising to some extent, so yes, if something that was once free is now being charged for but the customer gets something extra for this charge, you might get away with it (though I would still argue you’ve just given something extra away for free in order to charge). And also, some sectors that have historically offered free products or services dictate to all companies in those sectors that free is the only option –  for instance an online software provider would be expected to at least offer a free trial of their product if not an entirely free entry-level version of their product.

But in many cases, a company chooses to offer something for free for a short term gain.  But there are alternatives to ‘free’ that work just as well and don’t have the potential longer term downsides:

‘No-charge’, ‘Discounted’, ‘Limited offer’, ‘Loyalty bonus’,  ‘Volume bonus’

The above examples can all be linked to a free product or service without actually saying ‘free’.  They all remind the customer that this product or service is something you would usually charge for (i.e. you may charge for it again in the future, and it does have value to you). Also, some of these terms are based on the customer having to spend more or do more in order to benefit from the zero-charge (i.e. you are saying, it’s not free, but we are happy not to charge for it if we get something extra in return).

Has charging for products become unfashionable?

I accept that my view on the matter of using ‘free’ will not be popular with some. The freemium model does work (sort of) in some industries. And of course there are many aspects of a business’ offering that can be offered for free (blog posts, whites papers, events etc) as a means to build relationships or encourage engagement with customers.  However, businesses would be wise to take a step back from the fashion of offering ‘free’ and instead seeking out areas in which they can charge customers BUT ensure the value offered makes it too compelling for customers to ignore, even if it’s not free.



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