Does FREE Still Make Sales?

November 25, 2008


Does offering free stuff still help to make sales? At one time “FREE” was a great buzzword but there’s so much free stuff available now, I have to wonder whether folk value things that are free.

According to James Chartrand, too much free stuff is given away online and people should be charging for it. He makes a good point; if we give away too many free things, we need to rely on advertisers to pay for it. And I certainly wouldn’t like to be dependent on ad sales in this economy.

When Is Free Good And When Does It Suck?

Three for the price of two, or buy one get the second half price seems to make sales. And useful content that makes the reader want to own a book version works well. Leo of Zen Habits attracted a swarm of buyers when he brought out the Zen Handbook – a collection of his best blogposts.

Giving away free chapters of an ebook can also increase sales, if the book is good. As do the free reports that act as a salesletter for another product.

Free Ebooks Work Better If They’re Viral

Free ebooks vary. I’ve downloaded some that would probably be ok to read in print, but small print and hundreds of pages don’t work well in ebook format. And free ebooks that contain affiliate links can work well if the reader has a compelling reason to pass them on to others.

Giving heaps of free stuff away with the product you’re selling seems to be popular, despite some of the ridiculous claims. If you’ve bought a $97 information product before, you’ll know that the free bonuses worth $2999, are often worthless crap. But those bonuses still help to make sales.

Naomi Dunford pulled off the bonus offer better, because she understood her audience. So she didn’t bundle a pile of worthless junk with her Online Business School and tell folk it was worth $10,000. Instead, she offered products by folk who are known for producing quality materials, including Men With Pens, Michael Martine, and Havi Brooks.

This was a smart move, as she knew her readers would realise they were getting great value, as those people wouldn’t put their names on crap.

What About Free Services?

Some folk do well by offering free services and some don’t. I guess it depends upon how many customers you can convert to a paid service and if you can get some good testimonials, if you’ve just started trading. In an interview with Barbara Swafford, Tom Volkar explained that running a free community teleconference was beneficial to his Authentic Business Discovery course.

But Davina Haisell of Crimson Compass, gave free life coaching sessions to a friend and didn’t find it useful. She felt that the friend didn’t value the service because it was free. And Brad Shorr of Word Sell Inc had to persuade a couple of clients to change their ways because they were giving away services they could charge for.

Personally, I like getting free stuff when it has some value but not when it’s worthless junk. And giving away free stuff can be worthwhile if it brings you newsletter subscribers, buyers, or some great testimonials. But it’s certainly easy to go overboard and give too much away for free.

What do you think? When is FREE good and when does it not work? Do you take advantage of free stuff as a consumer, or do you find that free stuff holds little value to you? Have you used free stuff to make sales before? How did it work out?

Related Reading

The Secret Business Success Formula
What To Do If You Can’t Find Customers
Are You Working Hard But Making No Sales? Why You’re Not Making Lots of Money
Free Gift Ideas That Help You Sell More
The Everlasting Gift That Costs Nothing

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Comments

36 Responses to “Does FREE Still Make Sales?”

  1. Betsy on November 25th, 2008 4:53 pm

    Hi Cath – I think free does have value for the marketer and recipient, and can be a door-opener to gain new subscribers/customers, as you say. It’s sort of like, “Just try a taste,” which is what we do in the food business. The caveat would be consistency in quality and delivering value once they’ve decided to pay.

    I think pricing needs to be gradual, too. I’ve been thinking a lot about this subject as Pete and I prepare and evaluate additional products and services. I love how you manage to put up a post on a subject that is so meaningful to me all the time! Thanks.

    Betsy’s last blog post..TENACITY

  2. James Chartrand - Men with Pens on November 25th, 2008 5:24 pm

    In any relationship, there has to be give and take. Love, family, work… If you’re always doing the giving and never getting anything back, then it’s time to make a change.

    Thanks for the linkage and your thoughts, Cath – I’m interested to see what others have to say.

    James Chartrand – Men with Pens’s last blog post..What Grocery Stores Teach You About Free Content

  3. Maya on November 25th, 2008 5:24 pm

    Cath, This is an insightful article.

    In my opinion, free works only when it is a win-win for both sides. I think we have to be very clear of our goals before giving away something free. And I think it is okay to tell the other person what we are expecting in return – not our end goal, but what exactly they can can do to help if they indeed like what they get for free. The mechanics of HOW we give something away seems to be really important.

    “Free” created excitement. But “free” is worthless if the promised value is only a perception and does not live up. It can do more damage than not giving away anything.

    Maya’s last blog post..Integrity, Values and Happiness

  4. Jim Gaudet on November 25th, 2008 5:26 pm

    I think free is great, but that is really for me. I have a “knowledge overload” problem and I like to get every piece of information I can, especially for free.

    I do think Dovina is correct though, some people really believe that if you are giving it away fro free, it doesn’t have much value.

    Jim Gaudet’s last blog post..Managing Application Servers with WSUS

  5. Graham Strong on November 25th, 2008 5:31 pm

    Hi Cath,

    I think the question really is: how much is too much when it comes to giving away free stuff?

    I think that people expect free stuff today, and not giving it to them will drive away sales. People want to be educated, and who better to educate them than the vendors themselves? That’s why white papers and case studies are so popular these days. They are almost like sponsored bits of information. When done right, the information will convince readers that your products/services are the right ones for them.

    Yes, don’t give away the farm. But do expect to give something away, whether it is free information, a free sample, or a free trial. And as you point out, make sure you track your results to see if your list of freebees is really making a difference to your bottom line.

    IMHO,

    ~Graham

    Graham Strong’s last blog post..The Art of Perception V: How Does Apple Do It?

  6. Wesley on November 25th, 2008 6:12 pm

    Not to miss the main point of the post, but Leo Babauta wasn’t quite so loud about the fact that his “eBook” was just a copy of his blog posts. I bought the book and was angry when I discovered that. I felt cheated and used. Whatever money he made from that eBook was obtained unethically. Leo Babauta has a reputation for making money in questionable ways… for example, many times he has published a “review” of a book without mentioning that he is actually an affiliate who makes money for each copy sold!

    For this reason I think Leo Babauta is a bad example of someone who was successful charging for something. It’s fine to make money selling but do it ethically.

    Wesley’s last blog post..Oh, nevermind.

  7. Natural on November 25th, 2008 6:19 pm

    I like free stuff and it’s good when it gets you to want to use the product again, but pay for it. It depends on what someone is giving away, I have gotten a lot of free USELESS stuff…not practical, just free. It ends up in the garbage. No I haven’t used any free stuff to make a sale but I have given away free books on money in the past…that’s practical, everyone needs it.

    Natural’s last blog post..Being Human In the Age of the Electronic Mob

  8. Kim Woodbridge on November 25th, 2008 6:40 pm

    I don’t think free means less value but if I buy something and get something for free I will use what I paid for but not always use what I didn’t have to pay for. The free book or whatever might be of higher quality even but I don’t want to waste my money. I’ve downloaded a number of free eBooks that I’ve never read but any that I’ve paid for I have read.

    I also think that giving something for free might make people less inclined to buy something later, unless it was of exceptionally high quality.

    Kim Woodbridge’s last blog post..Stuff This in Your RSS – 11/25/08 – Jay is Games

  9. Kim Woodbridge on November 25th, 2008 6:43 pm

    @Wesley – I’m confused. I just followed the link for the Zen Habits book and it clearly states that it is a collection of blog posts. He even says if money is an issue to not buy it. I can’t comment on the reviews that are affiliates because I’m not familiar with that.

    Kim Woodbridge’s last blog post..Stuff This in Your RSS – 11/25/08 – Jay is Games

  10. Tom Volkar/ Delightful Work on November 25th, 2008 7:24 pm

    I often offer one or two free phone classes every month because they help me to display my wisdom and coaching skills. The benefits of coaching can be challenging to imagine unless you have been coached or have experienced coaching in some form. Phone classes leverage my time well because it’s only an hour no matter how many show. In this case the free sample works well.

    I also love facilitating groups – love the challenge and the unknown of it. I’ll keep doing it as long as it’s a win-win.

    I will not purchase an info-product online unless I see evidence of value. I’ve attended teleclasses of name authors that were nothing but 45 minutes of an infomercial and I’ve hung up never to go back.
    If you want my money you need to give me value first only because the field is too crowded to sort things out without evident value.

    Tom Volkar/ Delightful Work’s last blog post..An Authentic Approach to Making More Money

  11. ru4real? on November 25th, 2008 7:31 pm

    I think Maya put her finger on a big part of the ‘giveaway’ problem:

    “… tell the other person what we are expecting in return … The mechanics of HOW we give something away seems to be really important.”

    Giving away stuff (even good stuff) for the purpose of giving the recipient a warm fuzzy feeling isn’t enough ROI. Define a purpose for the ‘giveaway’ and investigate the potential benefits that can be harvested by doing the giveaway. And don’t be shy about telling the recipient what you hope to gain in return. Don’t get crazy and just start throwing stuff at the public like candy is thrown in a parade.

    ru4real?’s last blog post..7 Super Helpful Bible Study Tools

  12. Brad Shorr on November 25th, 2008 7:33 pm

    Hi Cath, “Free” is more effective when it fits the situation. In a rotten economy like this, cash is king. So I would not be tempted to open a checking account in order to get a free toaster, but I might be interested for a $100 gift certificate. When gas was $4.00/gallon, free gas cards were doing well. Today, not so well. A free ebook about surviving recessions stands a great chance of attracting attention, but a free ebook about how to invest excess profits might not.

    Brad Shorr’s last blog post..7 Things I’m Thankful For

  13. Michael Martine - Remarkablogger on November 25th, 2008 8:57 pm

    When comes to adding bonuses onto a paid product, relevancy is everything. Adding my SEO-Nomicon onto Online Business School is a natural fit, because many people who start or run an online business nowadays will use a WordPress blog as their site’s content management system, and SEO-Nomicon teaches search engine optimization for WordPress blogs.

    A good rule of thumb for free bonuses is this: if it’s not worth paying for on its own, it’s not worth anything as a bonus. That’s not a bonus at all, that’s just bogus.

    Here is an example from my own experience that showed me where free does not sell: the “free consultation”. Like many consultants, at one time I offered a free 30-minute consultation to prospective clients. I couldn’t live with myself if I just lead people on and didn’t provide something of value during that time, but what happened was that people would get so much out of it that they wouldn’t buy consulting services afterward.

    One person did everything I suggested she do, but never purchased any services from me. Not once has she acknowledged or attributed her rising success to me. And it’s not about my ego–it’s about being used. So, there are no more free consultations. My blog already has tons of free content on it that is the best I can produce. In that case, free did not make a sale.

    Michael Martine – Remarkablogger’s last blog post..ProBlogger’s New Blog about Twitter – TwiTip

  14. Tom Volkar/ Delightful Work on November 25th, 2008 9:08 pm

    @Michael Martine I had the same experience with sample on-on-one coaching sessions which I don’t offer any longer. They did not convert, often because coaching is a process that can take some time for real sustainable change to happen. My group calls are different as they are simply a taste of what may come.

    Tom Volkar/ Delightful Work’s last blog post..An Authentic Approach to Making More Money

  15. Kelly@SHE-POWER on November 25th, 2008 10:07 pm

    Cath

    This is a really good question and one I have often wondered about. Like James, I think far too much stuff is given away online. Personally, I don’t assume a free product will be any good unless I know and trust the provider, and then I assume it’s a taster for more add on services and that’s fine. If you do offer a free product online and it offers real quality I think the good customer feeling and trust you generate is worth far more than any add-on features. Though, like you said, Naomi used known people to provide her extras and so what she did was compound the trust. Very smart.

    I also think Tom is onto something with giving people a free entry point into his business. It’s not the complete product, so what he’s giving people is more risk free information and greater security and confidence that he’s the coach for them. One of my clients uses this technique offline with free seminars on naturopathy and alternative healing techniques. He does some basic free health tests and gives information to open people’s mind up to their possibilities. So far, it’s working wonderfully as a cost effective promotional tool.

    Interesting article and comments.

    Kelly

    Kelly@SHE-POWER’s last blog post..Picture Perfect Romance

  16. John Hoff - eVentureBiz on November 25th, 2008 10:31 pm

    Free can be good also if it helps to increase your LTV (Life Time Value) with a customer; that is, the benefit your company will receive from your relationship with the visitor over the course of the free interaction.

    What value does that free product give you? Is it a longer relationship with your customer, create a repeat buyer, give you some sort of market feedback, referral business, etc.

    Perhaps that product you gave them is just what they needed but once they reach a certain point you know they will need other services you provide.

    I can say this . . . FREE is not the closer when it comes to sales. I offer tons of free help getting started with WordPress and yet no one has signed up for my company because of my free offers.

    What are they looking for?

    Trust, security, an answer to their own personal problems, and easy price. Free is great, but the four I mentioned before I feel are more important to people than free.

    Ultimately, free is good when your free product solves the problem for someone well. This then creates trust. And trust is the best thing you can gain from a customer!

    John Hoff – eVentureBiz’s last blog post..My Favorite Kind Of Website Statistic To Have Is . . .

  17. Derek Halpern on November 25th, 2008 11:01 pm

    Free is a great way to promote your brand and help launch your blog or business into success. Unfortunately, most people go about it the completely wrong way.

    They create products or features or things for free that are sub-standard. So, the free things end up hurting their brand and business instead of helping them.

    If you’re going to try the “free” business model, you need to make sure you are delivering quality. If you do, you will be successful with it.

    Derek Halpern’s last blog post..Six Sure-Fire Steps to Sell Anything to Anyone

  18. James Chartrand - Men with Pens on November 25th, 2008 11:11 pm

    Want to know what I think everyone is missing? Frequency.

    Free ALL the time? Free continually? Free every day of the week? Free every month?

    WHEN is too much free dangerous?

    Free is definitely a good thing – we blog free and share our advice. We guest post for free as well. We offer a free forum and have a free rpg site too. Plenty of free.

    But we do not sell our soul for free. We cut back on our posting frequency at the blog. We don’t offer free downloads. We rpg when work permits, not every day. We don’t obligate ourselves to free guest posts beyond what we can handle.

    We use free judiciously and in a calculated method to get the most returns for our efforts with the least amount of effort possible.

    I’m wondering if *anyone* gets that FREE needs restrictions or it takes over your life and damages your ability to charge.

    James Chartrand – Men with Pens’s last blog post..Want to See Task One of the Sticky Business Contest?

  19. Melissa Donovan, Copywriter on November 26th, 2008 12:46 am

    There are plenty of good reasons to give something away for free. Contests come to mind, as do samples (i.e. sample chapter of an ebook). It’s a great way to entice visitors. However, I do think that we’ve become an online culture that expects lots of freebies – especially free information. Luckily, a lot of the free stuff out there is gimmicky and most people still believe that you get what you pay for. I try to use free stuff to attract visitors, and if they like it, I figure they’ll become customers.

    Melissa Donovan, Copywriter’s last blog post..The Top 5 Blogging Essentials

  20. Imran Anwar on November 26th, 2008 3:33 am

    In my humble opinion, giving away or not giving away stuff free has to be based on your long term strategy. If you are relying on FREEMIUM, where say 85% free users give you the volume you need to get the 15% who’ll pay for stuff, then free is clearly essential.

    If you’re selling something like insurance where what you are selling is of specific direct benefit to the user regardless of if you have 100 customers or 1 million then free is less useful.

    At http://neternity.org (which falls under the latter model) we are still finding ways to give some services free (e.g. Life Log pages for non-bloggers, etc. who may become large enough in data size to become paying customers for the very inexpensive “Live, Forever” service we offer.

    Hi Imran – I removed the second link, as more than one link to the same site isn’t necessary. Tip: If you tick the Commentluv box, it will link to the last post on your blog. Cath

    Imran
    IMRAN.TV

  21. cathlawson on November 26th, 2008 6:40 am

    Hi Betsy – thanks. I try to be useful. I see what you mean about offering a free sample, to tempt folk to try more. I’ve seen that used quite a bit in the food business. And it would be great if non-food businesses could find a way to apply it too.

    Hi James – you’re welcome. It was your post that got me thinking about how much free stuff is too much, so I felt compelled to write about it.

    Hi Maya – those are good points. It has to wait for both parties. And as you say, there needs to be some clarity about what you’re expecting in return.

    Hi Jim – LOL, so you’re an info sponge. I think you’re right re Davina. In some cases, free can devalue things. I’m betting the fact that the other person was a friend didn’t help. I guess you already talk to friends for free – so maybe they see coaching as an extension of the usual conversation.

    Hi Graham – White papers, reports etc seem really popular. And as you say, if they’re done right – they’ll encourage folk to buy from you.

    Hi Wesley – I’m sorry that happened. I know Leo makes it quite clear that his ebook contains blogposts now. Did you contact him and ask for a refund? I’m sure he wouldn’t mind.

    Re: Affiliate commissions from books. I know a lot of folk expect you to tell them in the post that you get a commission but I don’t really think that’s necessary if it’s a genuine review.

    A lot of folk make far less on affiliate commissions than some folk think and folk like Leo give a lot of great info away for free. So I do think they deserve something in return.

    Hi Valerie – a free trial of something you want to use again is always good isn’t it. And if the product is good – it works well.

    Hi Kim – you seem to do pretty much what I do with the free stuff. When you’re focused on the main product, it’s easy to forget about the other bits and pieces, regardless of quality.

    Hi Tom – the free teleclasses seem to work well for you. I can imagine that it must be quite difficult to show folk what coaching is all about, so I guess it’s a great way of doing it.

    Re: Sales pitches – I’ve been on paid courses before and felt like I’m being pitched for more expensive products all the time. It’s annoying isn’t it.

    Hi little real person. Could you share your name? It makes it easy to talk to you.

    You make a good point. You should always have a purpose for giving stuff away, or it’s a huge waste.

    Hi Brad – That’s interesting. So we should be thinking about what would be beneficial to folk in this economy. I guess that’s something we all really need to focus on.

    I keep getting an adsense advertiser on here trying to sell a book on investing in real estate. I think if I was in his position, I would be switching my focus to different products right now.

    Hi Michael – your WordPress SEO book is a great fit for the online course. I only wish more folk would give such good free bonuses.

    I did wonder about free consultations. I can see that being a real problem – especially if you’re doing a few of them. It’s bad that the woman didn’t even thank you. She could have at least given you a testimonial.

    Hi Kelly – that is true. Many of us know that free isn’t free – and if we like the sample, we’re usually prepared to buy the product. It’s a shame there seems to be many freeloaders around though.

    Your friend’s idea seems to be a lot like Tom’s. I guess by giving these sessions to a group and not giving away the farm, they’re more likely to get repeat business.

    Hi John – that’s interesting that your prospective clients weren’t so bothered about the free stuff. It’s just as well you did your research. I must admit – what I really like about your hosting service is your offer of making WordPress more secure, to prevent hackers. I’m betting that will appeal to a lot of people.

    Hi Derek – that’s a really good point. Why would anyone want to buy from you if your free stuff was substandard?

    Hi James – that’s a really good point. I’m thinking of cutting down on blogging too. As you say – it really cuts into your time and you can wind up giving too much away for free. The only problem is, the more I blog, the more free traffic I get from Google.

    But as you say – that’s no good if folk are expecting free stuff all the time.

    Hi Melissa – competitions are a great way to offer free stuff and get new customers.

    Hi Imran – that’s a really good point. Out of all that free stuff, you need to be getting a certain percentage of people who will pay – and you need to make sure that there’s enough of them to make it worth it.

    Your service sounds interesting – I’ll check it out later.

  22. Barbara Swafford - Blogging Without A Blog on November 26th, 2008 9:14 am

    Hi Catherine – Like many others have said, “free” has it’s time and place. I like getting a free sample of a product. If I like it, I will probably buy it. It reminds me of when you go to a place like Costco. You get a sample, a tease of sorts. With selling online the same could work well. Like Tom does. His free calls become the teaser. If those who participate find value, they’re apt to sign up.

    With regard to “free” ebooks. Most times we get what we “pay” for. Often they are just regurgitated information or something we can find on the internet via a search. If a blogger were to convert some of their blog posts into an ebook, and it’s a blog I like, I would be willing to pay for the ebook just to have the information in one spot. If we look at what our time is worth, it’s often more efficient to buy an ebook of an author’s posts (provided they’re helpful) than to spend hours digging through their archives.

    Like James said, as bloggers we’re constantly sharing free information. There comes a time when we need to put a value on our time. If we are investing additional time writing an informative ebook, instead of giving it away for free, maybe a free chapter would be a better alternative.

    BTW: Thank you for the mention.

    Barbara Swafford – Blogging Without A Blog’s last blog post..Is Blogging The Best Use Of Your Time

  23. cathlawson on November 26th, 2008 10:26 am

    Hi Barbara You’re welcome – I know what you mean. Searching through archives can be a nightmare – especially if there’s thousands of posts, so an ebook would often be worth it.

    I like the idea of giving a free chapter too.

  24. Jim Gaudet on November 26th, 2008 1:38 pm

    I guess you understand me pretty well. I would say that my conversations are filled with all sorts of “advice”…

    Jim Gaudet’s last blog post..Managing Application Servers with WSUS

  25. Marelisa on November 26th, 2008 8:11 pm

    HI Cath: I think that you need to have a clear strategy when you’re giving things away for free. If what you give for free is junk, you lose credibility. There’s also something called the principle of reciprocity. Basically, when you do something for someone that person is much more likely to do something for you. So if you give them quality content for free, they’re more likely to buy from you when you’re ready to sell them something. I agree that you have to be careful not to give away too much for free.

    Marelisa’s last blog post..Productivity Tip: Think Small

  26. Davina on November 27th, 2008 5:21 am

    Hi Cath. OMG, I started reading this, didn’t finish, and forgot to come back. Good thing my head is attached!

    I wrestle with the free thing. I’m thinking that my friend took the coaching less seriously because she didn’t have any money invested in it. And, probably because were friends.

    Like Tom says, I wonder how many clients invest in packages after just one “free” session. I agree with him that it takes time for a person to see the results. I would recommend at least a half dozen sessions. But the complimentary intro session is a good taster that will give both client and coach the opportunity to decide if they even have a rapport.

    I am happy to say that one of my previous connections has booked more coaching with me after having had an introductory session, so my faith has not altogether died.

    Thanks for the mention too Cath.

    Davina’s last blog post..Small Steps To Empower Your Attitude

  27. cathlawson on November 27th, 2008 10:41 am

    Hi Jim – It’s good that you’re an info sponge – you give great advice in these discussions.

    Hi Mare – I read about that somewhere. It may have been on your blog. It mentioned how many things you needed to do for someone else before they reciprocated and at what point you’d go overboard.

    I think you could get away with charging for a book of your posts like Leo did. Because each post is packed with helpful advice folk could do with the info all in one place.

    Hi Davina – it’s good that it worked out for you another time. I definitely think the fact you were friends made a difference.

    I wonder if it’s worth you looking at the free teleseminar thing like Michael and Tom do? Even if you sign up one or two people at the end, it’s worth it. And it’s less time consuming than the one on one taster sessions. If you ask one of them, I’m sure they won’t mind you listening in on theirs to get an idea how it works.

  28. Davina on November 27th, 2008 7:11 pm

    @ Cath, I think that’s a terrific idea. I’m also getting set up to work with Skype and am looking forward to opportunities to connect that way. All a person needs is the free download and then, to purchase a microphone and headset.

    Davina’s last blog post..When Fear Closes In, Take Action

  29. stevieboy66 on November 28th, 2008 1:28 am

    For sure giving away makes sales. However, it should be targeted. Identifying a core prospect’s real needs and supplying it without charge can bring you a customer for life. But don’t waste your gifts on the long ungrateful tail.

    It can make selling simple because you take away all the prospect’s buying objections in one hit. Because they aren’t buying anything. You’re giving it away.

    stevieboy66′s last blog post..Another 10 Ways To Improve Your Cash Flow

  30. cathlawson on November 28th, 2008 7:03 am

    Hi Stevie – Good point re it needing to be targeted. It’s got to attract potential customers, not freeloaders. I made the mistake of running a competition last year and advertising it on some of the competition sites.

    It was a huge waste as I just attracted folk who wanted something free, rather than those who were in the market for what I was selling

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