"There is no such thing as a free lunch." But in real life there are often free services and products appear, such as the end of 2005, the Grand succession announced the "Blood Legend", "Legend of the World" and "dream country" three large games to take "permanent free" way to operate; 2007, the The New York Times announced free, the past 28 years of reports and articles are available online for free access; April 2008, Rising announced the launch of "Rising 2008 version of antivirus software" free use of six months of action ... Why is that? Is "There is no free lunch" to rewrite it?
One, free marketing two strategies free is a kind of wash away the old thinking business experience, but for enterprises, free More is a survival law, a can change the old development model and realize the "power machine." Free marketing strategy will be rampant in the 21st century market, it is mainly by the "free Price strategy" and "cross subsidy strategy," the two theories to do the basis. 1, free price policy is a free pricing strategy is commonly used in marketing strategies, is the enterprise's products or services to zero price or near zero price of the form to provide customers to use, to meet customer needs. In traditional marketing, the free price strategy is generally short-term and temporary; in the network marketing, the free price strategy is a long-term and effective enterprise pricing strategy. The products that adopt the free strategy are generally use the product growth to promote the occupation market, help the enterprise to obtain the income through other channel, lay the foundation for the future market development. However, not all products are suitable for free pricing strategies. Affected by enterprise costs, if the product development success, only through simple replication can achieve unlimited production, so that the marginal cost of free goods to reach 0 or through a large amount of users, so that its sunk cost diluted, this is the most suitable for free pricing strategy products. Free price strategy if used properly, it can become a marketing tool for enterprises. 2, cross subsidy strategy cross subsidy strategy is the use of complementary products in the close relationship between the implementation of comprehensive pricing, to the income of profit products to subsidize the sale of products due to preferential prices of the loss, thereby promoting the sale of complementary products, to obtain greater profits. is to promote the sale of more profitable products by consciously selling a product at a discount or even a loss. Michael Porter, a famous management, called the former product a basic product, and the latter was called a profitable product. In retailing, this practice is called "leading at a loss". The price of some products is set at a cost or even below cost level, to attract those who are very sensitive to the price of customers to patronize, hope that these buyers will buy in the store other profitable products. The same pricing strategy has played a role in a strategy involving complementary products called razors and blades. The razor is sold to the buyer at cost or near cost, and the ultimate aim is to enable the buyer to purchase more profitable replacement blades in the future. Michael Porter gave the necessary conditions to use this practice. Pledge． Sales of basic products are sensitive enough to price. Basic products must have sufficient demand price sensitivity, so that the increase in sales of profitable products caused by discounted prices will increase the profit enough to compensate for the loss of the price. If the demand for basic products is not very sensitive to price, it is best to seek normal profits at the same time in basic products and profitable products. Pledge． Sales of profitable products are not sensitive to price. The demand for profitable products must not be very sensitive to price, so the increase in prices will not reduce the sales volume significantly. Unless this is guaranteed, the sale of profitable productsThe resulting profits are not enough to compensate for the loss of profits on the sale of basic products. For a profitable product, the sensitivity of its demand to price depends on the value it creates for the buyer and the degree to which other substitutes threaten it. Pledge． Basic products and profitable products are closely related. The sales of profitable products must be linked to a certain extent with the sales of basic products, so that the buyer cannot take advantage of the cheap basic products. If the link between the base product and the profitable product is not strong enough, the company is likely to find that it is selling only low-priced basic products and not selling profitable products when it adopts a cross-subsidization strategy. Pledge． Barriers to entry into profitable products industry. Unless basic products and profitable products are closely linked, it is very difficult to get into the profitable product industry in order to succeed in the Cross-subsidization strategy. Second, free marketing three models of free things everyone likes, so it is easy to spread out, free strategic marketing also has a strong vitality. However, the use of this strategy and strategy will make the enterprise pay a huge price, so the enterprise in the use of this strategy and strategy, need to be prepared. Enterprises in the use of free price strategy should carefully analyze the various models and their own situation, and take reasonable and effective business strategy, so that the advantages and disadvantages, can really play the role of free price strategy. 1, completely free marketing model products completely free, that is, products from the purchase, use and after-sales service all aspects of the implementation of free. such as Sina launched in 2005, "Celebrity Blog," The News form, after more than a year of development, the current Sina blog's day visits have been billion, a huge amount of traffic for Sina's advertising revenue and wireless business income has laid a good foundation. Although blogs are free, the value exchange occurs when readers browse the blog. Because we are browsing personal blog content, we will increase the number of visitors or links to the blog, which has increased the credibility of bloggers, bloggers can use credit ratings to obtain his social circle, and even converted to money. From May 18, 2003 onwards, "Free West Lake" has become the tourist convention of Hangzhou City. What's the benefit of not receiving the tickets? But the Hangzhou municipal government, instead of causing losses, has achieved profitability. A set of data can explain this problem, the implementation of the "Free West Lake" in 2004, Hangzhou, a total of 30.16 million visitors to host domestic tourists, an increase of 8.65%, to achieve domestic tourism income of 36.118 billion yuan, an increase of 24.12%. 2004 11 Golden Week, Hangzhou mansion, department store, Yintai general merchandise and Hangzhou, such as four shopping malls, sales growth of 19% year-on-year; Lou, Tenkorou, Zhang, new flowers, Midtown and other 6 catering enterprises sales revenue more than 11 million yuan, It was one of the fastest growing years of tourism income in that year. "Free West Lake" is the use of the principle of cross-subsidization strategy, more popular, the income is naturally increased. 2, restrictions on the implementation of the product free mode free mode There are many kinds, according to the "free" book author American Chris AnderSen (Chrisanderson) 's view, will limit the free mode into four kinds. Pledge． Limit time. For example, 30 days free, after the charge. The advantage of this model is that it is easy to achieve and the risk of market erosion is small; the downside is that many potential customers are unwilling to try because they know they will be charged after a 30-day probationary period. When Microsoft launched office2007, authorized computer manufacturers to install a free 60-day retail version of the new computer office2007, after 2 months of probation, consumers need to buy a legal password to "unlock" your office2007. 2). Qualifying features. For example, the basic version of free, advanced version of the charge. The advantage of this model is that it maximizes product visibility; The downside is the need to create two versions of the product, and if you add too much featured services to the free version, there will not be enough users to turn to paid users. And if you add too few features, there will not be enough users to turn to paid users after using a fairly long free version. 3). Limit the number of users. For example, a certain number of users can use the product free of charge, but more than this number will be charged. The advantage of this model is that it is easy to implement and easy to understand; For example, many training companies often have such advertisements, such as when they have signed up before a certain date, and their fees are reduced or the first 5 applicants are exempt from handling fees. 4). Qualify user categories. For example, low-end users can use the product free of charge, high-end users need to pay. The advantage of this model is that it can charge the company a fee based on its ability to pay, and the disadvantage is that it is complex and difficult to regulate. such as the Microsoft BizSpark Project is the use of this model, in the project was set up less than 3 years and operating income of less than 1 million U.S. dollars of companies can use Microsoft's business software free of charge. 3, the product implementation of bundled free mode of product implementation bundled free, that is, the purchase of a product or service to give other products. For example, some software will implement bundled free strategy, through the sale of mature software to bring new software into the market. Bundled free strategy does not bring direct income to the enterprise, its advantage is to let Enterprise's products quickly occupy market share. In 1903, salesman Kim Gillet (King Gillette) invented a replaceable blade shaver for 4 years, but sold only 51 knives and 168 blades in the whole year of the initial sale. After that, Gillette created a new business model. He sold millions of of his knives to the U.S. Army at a very low discount, in the hope that the soldiers could become a loyal user of Gillette after retiring Haigu. He also sold the knife to the bank at a very low discount, allowing the bank to serve as a gift to the new account (the famous "Save for Razor" activity). Through this new business model, he has sold 90,000 knives and 12.4 million blades in just one year. His razor and a lot of hot produceProducts have been bundled sales, including chewing gum, coffee, tea, spices and cotton candy, so far, Gillette has successfully sold billions of blades. China Mobile will send you a mobile phone for free, on condition that you spend a lot of money on the phone every month for the next 2 years. Coffee suppliers can send a coffee machine to your office for free, but you have to buy their coffee beans; HP's printer is the cheapest one for 300 yuan. But the print cartridge is the main profit of the IT company, which earns more than $ hundreds of billions of dollars a year. The emergence of these phenomena is the use of bundled free mode.
