Friday, January 3, 2014

BEST THINGS IN LIFE ARE FREE!

As the new year begins, let’s resolve to truly create happiness even when none exists. Meditate upon what actually makes us happy. Surprisingly, these very factors [of joy] that we discover are closely connected to our businesses too. These are the very things that make our customers happy.

We don’t need much soul-searching to conclude that things that truly make us happy, actually come for…free! A smile from a loved one, a hug from your child, an unexpected call from an old friend…and the list goes on. In business too, ‘FREE’ is the word that can trigger a cascade of smiles and happy reactions amongst the customer community – or “maximum” sales as you call it – and is arguably the best deal that you can give to the consumer.

‘Free’ is Actually a Good Marketing Strategy

The one man who has shown the power of a tempting freebie is none other than the new CM of Delhi – Arvind Kejriwal. Free water and free electricity have made him the darling of the masses, giving him a definitive lead over strong political rivals – BJP and Congress.
Last year, Apple too used freebies to beat its competitor Microsoft. It announced a free upgrade of its software OS X. Users of OS X (versions Snow Leopard and higher) were allowed to upgrade to their latest OS X (Mavericks) at absolutely zero price. It was also announced that in future too, all OS upgrades would be free. The Cupertino giant also announced the free inclusion of an alternative to Microsoft’s Office suite in all Apple laptops in future! Anybody’s guess this – Tim Cook has found a way inside Microsoft’s head. It’s got the software giant guessing beyond just who would replace Steve Ballmer in time – what should it price Windows 9 at?


Brands that offer unexpected free services can very easily win loyalty of their customers and eventually defeat competitors. Take the case of Mail Online. For a very long time, The New York Times (NYT) was the most visited newspaper website in the world. But as Bob Dylan would have imagined matters for NYT a decade back (remember his ‘Things have changed’ song: “…People are crazy and times are strange; I’m locked in tight, I’m out of range; I used to care, but things have changed…), in 2012, Mail Online beat NYT by clocking 45.35 million unique visitors as compared to 44.80 million of NYT. Mail Online also became profitable in the same year. Apart from giving readers the content they wanted by carefully researching what the reader was looking for and providing them just that (in most cases readers wanted to see bikini clad pictures of celebrities), Mail Online has kept its content free. Some comparison with NYT, which keeps most of its content hidden behind pay walls! 

The past year saw the rupee plummeting and general consumer demand dropping. This made brands run helter-skelter to beat the downward swing. Some smart ones realised that reducing prices was not feasible so they bundled freebies to get rid of their surplus inventories and make their offers appear lucrative to buyers. HUL offered lots of freebies like free conditioner with shampoo, etc.

FMCG companies have for long been known to dole out freebies to boost their toplines. Now it seems the companies selling durables have found this to be a good strategy. Last year, Volkswagen launched a new scheme where a new Vento was offered in exchange for an old car. In Gujarat, there was a Skoda car dealer who came up with the most mind-boggling offer. He offered a free Fabia model on the purchase of a Skoda Rapid! Just one small condition - the Fabia would be given after five years. If reports are to be believed in two weeks the dealer had sold about 600 cars. It’s definitely for a reason when people say no one can do business like a Gujarati!!! Buy a car and get another free – shocking, surprising…yet one of the most stunning offers possible! [What next in Gujarat? A car for a car stereo?]

Advertise on Google or Facebook and get free analytics to know who exactly viewed your advertisement. You would never go to an ad agency after this. 

Look around and you will see smart marketers offering ‘free’ stuff to win your attention. Free home delivery, free test drives, free installation, free samples, free shipping, free newsletters, free upgrades, free registration, buy-one-get-one free, happy hours, free trials…and the list goes on. Secret? ‘Free’ wins attention. ‘Free’ attracts! After all, free implies no risk, no downside – making it totally irresistible. This is the emotion companies exploit and try to make a killing. A good marketing strategy is one that includes some or the other ‘free’ offering to the consumer.

Free Never Hurt Anyone

If it’s free, its harmless and in some cases, even beneficial. If there is one thing that can get cash registers ringing, it is ‘free publicity’. Apple has mastered this deft touch, for it knows all the tricks of the trade and generates maximum amount of free publicity. If people are talking about you, chances are very high that they are buying your brand too. Take the case of Apple. According to a study released by Brand channel in 2012, Apple-branded products were seen in 42.5% of the top 40 films of Hollywood (in 2011). That means free advertising of its products to an audience that does not even have the remote to fast forward your ads! Apple has got the highest visibility in Hollywood in the past decade – more than the combined product placement time of McDonald’s, Pepsi, and Sony Vaio. Incredible. The second technique that Apple uses to generate free publicity for itself is through speculation. The company is so secretive about its new products that ‘leaked information’ from its labs automatically becomes everybody’s business! ‘Rumours’ are its most potent weapon, for they make the world so curious that when the company finally launches its new product(s), it manages to attract long queues of customers outside its retail stores, dying to get the first glimpse of its ‘much awaited’ creations. In fact so popular are the rumors about what Apple is about to bring out next that Huffington Post has a recurring feature called “The Week in Apple rumors’!

Gizmodo got hold of a ‘misplaced’ iPhone4 and wrote about it making the customers go crazy with anticipation, just a few days before Steve Jobs launched it. Whoever said business had to be boring, look at Apple and learn some bit of fun. Tomorrow, you can actually have customers eating out of your hands.

Free publicity – good or bad – always helps. Recall the scene from the film ‘The Wolf of Wall Street’ where a scathing article on Jordan Belfort calling him a ‘twisted Robin Hood’ in Forbes (magazine) is shown and how that gets him very upset. And how his wife then explains that no publicity is bad. Wasn’t she proved right the very next day when his office was swarmed with new recruits anxious to work for him? 

The most popular show on Indian television today, ‘Comedy Nights with Kapil’, has stars lined up in every episode trying to get as much free publicity for their upcoming films. It’s not paid ads but the free publicity that causes the sale.

Free anything works. Even free advice. Look how Amazon suggests things you would be interested it. Look how most apparel retailers give you free advice on the latest trends and how to look good.

So go ahead and find out how to get the maximum free coverage, for free works like no other. However let’s pause and thing “Is it really free?”

There is No Such thing As a Free Lunch

Finally as consumers we must remember that there is no such thing as free. ‘Everything’ has a price! TNSTAAFL (There is No Such Thing As A Free Lunch) is a term that originated in old New York many decades ago. Back then, restaurants used to offer free lunches to customers, with one simple clause – they had to buy a bottle of beer along with it. As it goes without saying, the beer was grossly overpriced and the food was salty, making the customers buy more than one beer bottle and making the whole venture tremendously successful for the owner. What it boils down to is for everything offered for free, there is a hidden [disguised] price. It’s all about how you present it to the consumer and convince him.

Finally, while we say there is no such thing as a free lunch, there are certain things which are free and should remain free or become free if they are not. Yes love is free, air is free, but so should be education and basic health facilities for all – that’s if we really want to live in a humane society. While we as business people plan a lot of free stuff for our consumers, let’s also remain committed to this cause. A society that’s well taken care of, will also take care of you and your brands.

Free Things Motivate

While everybody wants to take home a hefty paycheck, the most motivated and loyal employees are also not those who get paid the highest but those who get a timely pat on the back from their bosses. The happiest kids are not those who get lots of gifts but who get lots of time from their parents. It’s not a three carat diamond ring but the three words ‘I love you’ that bind two hearts together. So make space for all this free stuff to really make a difference.

As the new year begins, let’s remember to include ‘free’ in our marketing strategies while not forgetting that the best things in life come ‘free’.

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