Managements’ Motivations For Free…
Though the payoff from free/style business is obvious for customers (free stuff!), what possible reason would managers have to implement such an approach?
The organisational value in free/style comes about because it addresses the fundamental problem all firms face; how to get customers.
In traditional approaches to business price acts as a barrier to entry, and lots of activity is related to knocking that barrier down.
Marketing does this by trying to convince customers there is no risk in paying the price…
The problem is when there is a price, the customer always has a risk!
Free removes this
What’s the payoff for the manager adopting free?
- Overcoming the natural aversion to change and risk that humans have
- New customers using their offering, experiencing their service and giving their organisation the opportunity to prove the ‘value’ the marketers keep spending money on convincing them is there…
- Opening the channels for dialogue about their experience and opportunities in the future
- Customer information that you would normally have to pay a third party to collect
Why wouldn’t managers want these opportunities?
The only reason could be that what they need us to pay upfront as they can’t deliver on their promise
Of course it is not so simple to make free//style work for everyone, but given the compelling reasons to, you should be trying…
PS Thanks to Bwagy for asking the question. To see how he approached it check his book and “pay what you want” consulting.