FREE Is Powerful!

16Jul08

www.neurosciencemarketing.com

This is a fantastic post about the power of FREE!

When to use free!

FREE! is more powerful than any rational economic analysis would suggest. If you want to sell more of something, use that power. I often see department store offers like, “Buy one pair of slacks at regular price, get a second one for only one penny!” That may sound clever – “wow, pants for just a penny!” – but I think FREE! will outperform the penny offer. Want to spark sales of a product? Try offering something for FREE! with it. Want to get the widest possible sampling of a new product? Use a FREE! sample.

When not to use free!

There are some cases when using FREE! isn’t the best idea. If you are trying to encourage sampling of a product that appeals to a specific audience, for example, a very modest charge will throttle demand but will eliminate most samplers who have no use for the product. For example, I don’t own a cat. I don’t even care much for cats. But if the supermarket had a big display of “Free Cat Food Samples” there’s a good chance that I’d pick one up, thinking that I’d give it to a friend. Or maybe hang onto it for when one of the inevitable stray cats shows up. Hey, it’s FREE! – I’ll grab it now, and figure out what to do with it later.

If Ariely’s research is to be believed, pricing the cat food sample at a mere ten cents would almost certainly slash inappropriate sampling by people like me. A few legitimate cat owners might avoid the sample, too, but the overall cost/benefit of the program would likely improve.

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