Free products must be done better than the charging products

Zhou said a very contrary to the economics of common sense, that is-free products must be done better than the price of products. This is so contrary to the common sense of economics that many people disagree. However, this phenomenon has been happening in the Internet industry.

2009, "Wired" magazine editor-in-chief Anderson's masterpiece, "Free" once launched, then sell the world, making free this concept became the Internet industry common sense, the Internet age business success law. Free pricing strategy behind the unprecedented development of the internet, the theory that: the Internet, all information constitutes a product of the marginal cost of zero, so, the price of zero is the safest arrangement.

It was only then that people realized the business logic behind Zhou's remark. To better than the premium products free products quickly gather a large number of users, and then through advertising, value-added services, virtual products, etc. to achieve fees. Back in the past, Google, Facebook, Baidu, Tencent, 360, and other giants such as Alibaba have come. 360 Year's free strategy to make it quickly become the industry public Enemy, the target, but also because the free anti-virus quickly gathered a large amount of users, Taobao used to be through free, will be ebay in the Chinese market rout. It seems that the free strategy has become the Internet industry's omnipotent strategy.

Free, seems to have become the internet era of an indispensable beautiful scenery.

Until the 3Q War on the network uproar, but also to spy on user privacy, but also the window, kidnapping users two choose one, just let the Internet users realize that we have been providing free service is not "live Lei Feng", but their hearts are carrying their own calculations.

Today's free strategy is not just to please the user's behavior, but also a means of checks and balances between businesses.

Last month, Baidu suddenly announced that its "Baidu navigation" business is completely free. Three hours later, the "Gold Navigator" also announced a full free. The news was extremely sudden, and there was a whiff of gunpowder in the middle. Mobile internet is experiencing a booming spring, mobile phone map will be one of the most important portals of mobile internet, in the past 5 years, the German navigation has accumulated 70 million of users, its charging mode has been accepted by users, now suddenly announced free, only one explanation, That is a powerful counterattack to Baidu's free navigation. Considering the high German navigation biggest shareholder Alibaba's powerful strength, we have reason to believe that the German navigation with Baidu to contend with the ability.

But is it really good to be free?

Ma Yun once said, free is the most expensive.

This is another way of thinking about the free strategy. The downside of free will be that once the free trade is established in the industry, it excludes all the price discrimination structures in the market, and the end result tends to be the oligopoly economy, which is a single big situation. Finally, a healthy business posture is formed. This from the current situation of traditional media can see some clues, the content of traditional media through Baidu and the major portals and other free channels, access to a great user attention, but the value of advertising is directly after the two river closure, and users also reduce the purchase of paid paper version. As a result, content vendors are unable to pay high production costs and can no longer provide high quality content.

In addition, the free strategy creates a very low-cost user migration, which is because the user chooses to have zero cost, so the winner will try to circle the user as much as possible. This results in a free access to the user, the actual operating cost is very high. Therefore, in essence, free business is a real big player's business, small companies are increasingly playing.

The confrontation between the gold and Baidu, but also the free strategy of a head-on collision, which will collide with what kind of outcome and spark, will be the mobile navigation industry, what kind of impact is an extremely worthy of observation.

However, in the final analysis, this is the fight between the Gao, the Internet has developed to today, can be so big deal with the fact is not much, for more entrepreneurs, abandon free, learn the right fees, is the only way to healthy development of enterprises.