The March 26, 2012, Dilbert comic strip gave me quite the belly laugh.
Dilbert explains to his pointy haired boss a competitor has purchased 10,000,000 copies of their software. The reason? The competitor plans to give them away free, anticipating the softwares poor quality will drive each recipient to buy the competitors software. Dilbert explains his company has unwittingly become part of the competitors Freemium Strategy. Now thats a marketing plan!
Weve all heard of loss leaders to get customers in the door, but this one takes it to a whole new level.
Think about it! Can you imagine buying massive quantities of your competitors product, freely giving that product to your prospective customers, and then reaping the reward as they respond by willingly purchasing your companys product?
Can you imagine being the sales rep who receives that call?
SALES REP: So you want to purchase 10,000,000 units?
CUSTOMER: Oh, absolutely! How fast can you ship them?
SALES REP: Well, Im sure we can have them to your location within a couple days. And hey, with the size of this order, well just go ahead and cover the shipping for you.
SALES REP: Well, its the least we can do for a great customer like you. So, you really love our product, dont you?
CUSTOMER: Oh, yes. Your product is our cash cow! We are going to give them out free to all our prospects. After they experience your product, they will be begging to pay us for our version. Thanks again! [Click]
Although this is obviously a joke, as is so often the case with humor, it derives its punch from the grain of truth. Dilbert is funny because the outrageous humor contains that grain of truth.
Think about all those free pieces of software or free online services you have willingly received. In many cases, the free version slowly whets your appetite for the more full-throttled version. Cha-ching. The company makes a new sale and youve just been converted to a paying customer.
Think about all those times you chose to purchase one companys product or service, but after experiencing it, you decided to switch to a competitors product or service. As consumers and as business owners, our experience predisposes us to action. One action might be to stick with an excellent product or service. Alternatively, because of our bad experience, another action might be to switch to the competitor.
Well, now Im waiting for the day when a company does try the Freemium Strategy. Hey, it just might work! When it does, youll hear me laughing.
And I have to confess, my laughter will be tinged with just a hint of admiration.
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