Normally I wouldn’t name a specific rock band on this blog, just to make a point. Musical taste is too polarizing and I want to make sure that I’m reaching all kinds of readers, from Bach enthusiasts to Lady Gaga’s Little Monsters.
But when I started to write about “Free Stuff” today, I just couldn’t get one band out of my head. This example is just too perfect for what I’m talking about today.
Late in 2014, the mega band U2 partnered with Apple in an innovative attempt to deliver their music to the masses. With the release of the new iPhone 6, all iTunes members were given U2’s album “Songs of Innocence” – for free! It downloaded automatically onto their phones.
Now you’d think people would see this as a generous, wonderful thing to do for music lovers, wouldn’t you? A free album from one of the biggest bands on the planets?
Not so much.
People got so put off and even irate (“This album I didn’t want is now hogging all the memory on my phone!” and “I hate this band, why do I have to now delete something off my phone I never asked for?!”)
Backlash got so bad that front man Bono eventually apologized: “Oops. I’m sorry about that. This beautiful idea, we kind of got carried away with it.”
Now contrast that reaction with the free album promotion by another successful rock band, Radiohead. In 2007, this band decided to post their new album “In Rainbows”, for free on their site. Or rather, using something like the honor system. You could download the album and pay as little or as much as you liked for it. A risky move, to be sure. But did it work? Yep!
“In terms of digital income, we’ve made more money out of this record than out of all the other Radiohead albums put together, forever — in terms of anything on the Net. And that’s nuts,” said Radiohead frontman Thom Yorke in December 2007, when interviewed by David Byrne for Wired Magazine.
So free trials can work, and work well. The examples listed here are on a fairly grand scale and likely nothing you’re going to be attempting as a small business owner. But if you keep a few pros and cons in mind while navigating the tricky-but-potentially-profitable free promotion waters, you can harness the Power Of Free for your own company.
The Mass Appeal
One thing you can definitely expect when you hang the “Free” sign out is a big response. Prepare for loads of interest and questions and curiosity and traffic. A free offer is a great way to inject some volume into your subscriber base and hopefully, customer base.
Caveat: Be careful who actually comprises that big crowd. What do they really want? What don’t they want? If all they want is the freebie and if they are nowhere near your usual customer demographic, are you sure it’s worth attracting them?
(This post on catering to your perfect customer’s needs will help you decide what kind of freebie to create.)
Free trials aren’t cheap so as best you can, try to ensure that what you’re giving away helps pre-qualify them as someone who’d eventually be in the market for your paid products.
A perfect example of how not to run a free promotion happened back in 1992. The British division of the Hoover brand promised free airline tickets to customers who purchased more than £100 worth of its products.
According to Wikipedia:
“However, Hoover had not anticipated that huge numbers of customers would buy the qualifying products not because they wanted the actual appliances, but simply because they wanted the tickets.” So this botched promo, the subsequent customer outrage and the court cases that followed ended up costing the company almost £50 million.
So be careful to tie the free promotion more tightly to your product line. And to measure out what it’s really going to cost you, beforehand!
The Fence Sitters
If I had to pick one kind of customer that is absolutely a prime target for free promotion, I’d say it was the fence sitters. The folks who need what you have to offer, who like your product and are curious about it…but they just…can’t…pull…the trigger.
Tip them over the line and make it a no-brainer decision by offering them a freebie or trial. Chances are they will ripen into a paying customer.
Caveat: They will ripen into a paying customer but only if you keep leading them down the paying path. What happens at the END of a free trial is almost as crucial as what happens leading up to it.
Letting the free trial or giveaway simply end, with no follow-through, is to let that fish off the hook scot free, if I may mix a metaphor or two.
There are several ways to keep them engaged and interested. One of the best ways to lead a free customer down the paying path is to do so gradually. Instead of shocking them by suddenly charging them $100 for something that they were getting for free, try giving them a 25% off coupon. With, of course, boundaries on it.
Tell them that it will expire within 30 days of the free trial ending. This will make it easier for them to dip their toe into becoming a full-paying customer.
Caveat to the Caveat: Beware what I call The Comeback Kid. There’s a certain type of consumer who smells blood in the water when they hear of a free promotion. The wrong kind of customer will think that once you have offered them something for free, that they can negotiate free stuff forever.
Watch for these customers. While you want to slowly ramp customers up to paying, giving free things away over and over will attract these Comeback Kids, who will likely never end up being paying customers anyway. Keep your eyes peeled for these and quietly, politely move them out of your funnel.
In Their Hot Little Hands
How many times have you thought “Gosh, I know they would love my product or service…if only I can get them to try it!?” Well, that’s what free trials are for.
Once you knock down that financial obstruction, customers are more than happy to take your product and put it through its paces. If you quiz them at just the right time, even if they don’t end up turning into paying customers, you’re still getting invaluable feedback.
Free trials are a fabulous marketing research tool, if you build in a survey.
Caveat: Make sure what you’re giving them for free is truly indicative of the quality of your product line or services. When you are setting out the budget for a free trial, it can be so tempting to give away something that doesn’t cost you that much.
Maybe a plastic tchotchke left over from a past trade show, or a service that requires the bare minimum of man-hours from your staff. But that’s short sighted. By no means should you offer the best of what you have, for free, forever.
That’s a quick and easy way to go out of business.
But you also can’t give away stuff that’s cheap and easy. The idea is to give them something so good they’ll want more, more, more. And to get it they’ll be willing to pay, pay, pay.
This last one is more of an interesting psychological phenomena than it is a tip. For some reason, consumers are more likely to value a greatly discounted or even free product than they are a discount or free service.
Studies have shown that they will tend to think “you get what you pay for” when it comes to services in ways they’d never do with a product. So hours of work on your part, with free consultations or free analysis of the customer’s problem, could all be for naught if you give it away for free.
Keep this in mind if you’re selling services. It might be worthwhile to brainstorm a way to give away free stuff versus free time.
What free trials have you used? Did they work, did it hook you? Have you ever taken advantage of a free weekend of online dating, or watched a free weekend of a free premium cable channel…and gotten so hooked you ended up paying?
I want to hear what has worked on you, and what hasn’t! Tell me in the comments below!
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