Should I give away stuff for free?

Should I give away stuff for free?

Whether you are a small business or a global brand, giving away free stuff can actually make you money. So don’t be stingy about giving away things for nothing. Here’s why.

1. Free stuff creates buzz. Thanks to social media, news travels fast. If you give something away people will tell their friends who will tell their friends, and so on. You can create a lot of excitement this way. People will want to check out what’s going on and get to hear about you and your brand.

2. Free stuff encourages people to try your products without risk. You can prove that you have something different or better to offer. People are more likely to try something they normally wouldn’t if it is free and without financial commitment.

3. Free stuff is the hook that gets customers in. Sure, some people will take advantage. But the offer will create a lot more sales than not. Why do so many restaurants offer “Kids Eat Free” days? Because kids don’t eat alone.

4. Free stuff means that customers are more forgiving. People are more lenient if they feel like they’re getting a bargain. That’s not to say you should use it as an excuse to sell substandard products, but it can be useful for testing something new or untried.

5. Free stuff creates positive brand association. People love to get something free, no strings attached. It makes them happy and brightens their day. By doing this, you can create a hugely positive association with your brand. Often the cost of offering a freebie is not all that different from deep discounting. Yet the former has much stronger customer value because they see your business as being generous.

6. Free stuff creates a usage habit. By offering something free, people are more likely to give your product or service a try. And once they've been hooked (assuming their experience is positive) they’re more likely to come back. So you become part of their consideration set and are much more likely to gain their repeat business in the future.

7. Free stuff connects you with your customers. People often place value on intangible things that your business can provide. For example free training videos, usage hints, alternate product uses and podcasts. Because it's digital, it costs you next-to-nothing to distribute. Yet it has the huge benefit of getting customers to register their name and email address, giving you with a means to contact them in the future.

8. Free stuff persuades customers to upgrade. Providing a free service allows you to gain a large user base quickly. Then, those who want more features can pay for a premium or advanced features. People that upgrade tend to be the minority, sometimes only 5% or less. Yet, if the incremental costs of your product or service are low, this can be more than enough to keep the business highly profitable.

Can you think of any other ways that giving away free stuff could benefit your business?

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