Free is Never Free

Free is a popular piece of many different business models these days. If I gave you 60 seconds to name as many brands that use “Free” as a part of their marketing, you could probably get a pretty sizable list going.

From freemium models - which offer a free version and a paid version of a product, to services that are completely free with money made on advertising, to free apps with in-app purchases, “free” dominates the marketplace. We offer free shipping, free trials, buy one get one free.

Dan Areily argues that “free” makes people act irrationally. And he’s right. Free shipping offers that save consumers $20 regularly outperform discounts of greater value.

But businesses must consider the hidden cost of “free”. Because in most cases, it really isn’t free.

If I am a free Spotify user, I have to live with the absence of certain features and the intrusiveness of ads. If I sign up for a free trial, I have to remember to cancel before my credit card is automatically charged when the trial concludes. If I sign up for free information, I have to give up my email address and submit to unwanted promotions.

Free is never truly free. There is a price we pay, as consumers, for everything we get from companies.

And so, as marketers, we must reassess our value proposition. How does our version of “free” impact our customers’ lives?