Michael Bell

How do you sell something that is free?

It has confounded me with a deeply researched value proposition that we are finding it difficult to impact our target audience with our offering. We did a remarkable amount of research prior to launching and found that in the industry we are targeting we needed a low to zero barrier to entry. I struggled with the concept of offering for free as often times if something is free, limited/zero value is placed in it.

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7 Answers

Steven Freeman

It needs to be tied to an up-sell or side sell. Free on its own has no bearing. Attracting a whole lot of random free loaders is when it starts actually costing you more than if you had a ticket price to start with.

 

 

Michael Bell

Michael Bell , Owner at Freshnearyou.com.au

So can I clarify Steven that you are saying that an up-sell needs to exist from the beginning? eg. Free widget that gives you XYZ OR you can upgrade to this pre... read more
So can I clarify Steven that you are saying that an up-sell needs to exist from the beginning? eg. Free widget that gives you XYZ OR you can upgrade to this premium widget that gives you UVXYZ?
Steven Freeman

Steven Freeman , Owner at Evolved Sound

Michael if you're to start with a free hook to begin with then it needs to be linked to a pathway to something more tangible for your business and customer.
Michael if you're to start with a free hook to begin with then it needs to be linked to a pathway to something more tangible for your business and customer.
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Steve Osborne

Steve Osborne , director at Smarthinking

Hi Michael, as Lisa says, Ripe Near Me appears to have somewhat stolen your thunder. Also, I can’t see anywhere in your model where revenue is going to come from. I have assumed there is an up-sell planned in the future. To answer your question, I took a look over the Fresh Near You site, searching for reasons your uptake is failing. I have drawn just one conclusion. It is this: despite your research and admirable endeavour, the value proposition is not powerful enough. Here’s why. The single most important reason a vendor will sign up is if you show or prove she will enjoy an increase in traffic to the farm gate. Not just any old increase mind, but ten fold. Anything less and natural human apathy kicks in. It’s not enough to promise a doubling of traffic. If she currently has one walk-in a week, two is not going to rock her boat. Ten just might.  So what you’ve got to do is get them over their (quite reasonable) ‘can’t be bothered/where’s the benefit?’ attitude. In other words – show me the money. The way to do that is to work really, really hard on developing your end-user base. You must create demand amongst your secondary target audience of food buyers, in order to on-sell the benefit to your primary target audience of vendors.  So the question now becomes: is there a big enough market to support the business model/service? And only more market research will answer that. But not the kind of research that has you asking people whether they would buy the service if provided. Because of course, people will say yes. They just won’t actually do it. You’ve got to find a way to test people on their behaviour, not their intention. The reason most people (and I’m grossly generalising here) will say they want the service but fail to act, is that there are already enough low-effort alternatives available. With the best will in the world, why would I trek miles out of my way to buy 2 x kilos of organic potatoes when I already shop at the local farmers market, or can buy them at the supermarket? You have to overcome the convenience factor.  And to do that, you must demonstrate to the end-user (again, as a ten-fold increase) the compelling benefit of making the journey. In your case, a tough ask. Clearly, there will be a die-hard core of anti-supermarket, support-the-farmer, dedicated organic produce buyers. But your competitor is wherever they are currently buying the same service from. It will take a gargantuan effort to change that behaviour. I ask again: is the audience big enough to support the model? In my view, for this model to work I think you need to forget the minority targets. They are buying the products anyway. Just not from you. Find a way to tap into the mass market. Your audience is the cashed-up, Masterchef obsessed, full-blown foodie. There are a lot more of them about than the organics-only crowd. And what you’re selling is: exclusivity.  The rationale is: superior taste.  Translated into marketing as: to put real love into your cooking, you must use authentic flavours. Authentic flavour comes from the freshest ingredients. And they are only available from authentic growers. In summary – unless there is sufficient demand from end-users, vendors will continue to ignore you. Create demand in the biggest sector you can find. Give end-users a compelling reason to use the service. When demand has risen to a sufficient level, convert your free subscription vendors to a paid version of the model. And there is the revenue stream. Now the question becomes: is it worth it? I hope you'll forgive my long-winded answer and find this (extremely condensed) marketing strategy of some use.

Lisa Ormenyessy

Lisa Ormenyessy , Business Coach and Marketing Specialist at Straight Talk Group

Ah; Thank you for following up on this post Steve. I was meaning to respond however, a 'longer' than usual answer was required so had put it aside. Besides ... read more
Ah; Thank you for following up on this post Steve. I was meaning to respond however, a 'longer' than usual answer was required so had put it aside. Besides taking the time for Michael, you have hit the nail on the head. Good Luck Michael. Keep us posted.
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Lisa Ormenyessy

Lisa Ormenyessy , Business Coach and Marketing Specialist at Straight Talk Group

Hi Michael, I love the concept of fresh near me - have you seen ripenear.me?  I think it is very similar.

I'm wondering what your business model is though  do you take a percentage of sales, or are you building a user list /  community that then you can market other products and services to as Steven has suggested? 

Michael Bell

Michael Bell , Owner at Freshnearyou.com.au

Hi Lisa, Thanks for your comment. I need to provide a bit more history, but the initial question only allowed 500 characters! I am sorry, this is a novel - it... read more
Hi Lisa, Thanks for your comment. I need to provide a bit more history, but the initial question only allowed 500 characters! I am sorry, this is a novel - it may answer Steve's question as well. We originally launched the site back in 2012 (https://www.youtube.com/watch?v=huu3ed1Vrgg) after 16 months of development - but after some major issues with our search function (never believe the philosophy of 'move fast and break things' because we actually had to go back to the drawing board - the issues with our development were so severe - we literally had to bin and start again. Very heart-breaking but we had an absolute desire to see it through. In the mean time there were are a couple of other sites that sprung up and ripenear.me was one of them. RNM focusses on what we have always classified as 'urban farmers', very similar to Local Harvest (.org) which also launched here back in 2012 at the same time as freshnearyou (mark 1). Their approach is really lovely and really suits market gardens and the backyard orchard. We have always included urban farmers in our Sellers - but our main focus has been retail, markets and farm-gate. Small independent fresh food retail market share sits at 5% - we want to change that. We believe through our extensive research that sites like ripenearme will not erode from the big supermarkets, but will continue to erode market share of small businesses.. in saying that we are excited that we had the right idea back in 2010 and that any alternative to supermarkets for fresh food is awesome and we see a real symbiosis in what we and RNM and local harvest are trying to achieve. Balance in the 'force' of fresh food! To answer your other question (I will respond to Steve also). Our business model sits around data. We want to provide back to our sellers very similar information that Woolworths and Coles are provided through Fly Buys and Everyday Rewards cards. Consumer habits. Small retailers don't have access to 'big data', whereas we can provide anonymous data to sellers around numbers of consumers searching for 'apples' in their specific catchment area at a given time of the year. Assisting with ordering/buying cycles along with implementing strategic marketing campaigns around that data. It's not ugly big data like the supermarkets, it's matching need with supply, providing sustainability to the industry, improving local sourcing and reducing waste and most importantly food mileage. This is why we provided the listing, profile and product inventory for free with 'add-on' products to be introduced in a few months if they so choose. During our market research we engaged a range of retailers, market stall holders and farm-gates and built our product around their requirements - and again in the second build to see if the market had shifted. We are getting a huge number of consumers using the site, but they are faced with not finding a seller because (a) The retailer hasn't completed their profile (using a step by step wizard - takes 5-10 minutes) (b) hasn't added their inventory (Takes 15 seconds to add a product via a wizard. So chicken before the egg scenario. We have provided a super easy FREE alternative to a 'directory' that is category driven and supplied a 'Product, Place, People' driven super search that really targets the 'who' is the business owner and sells the 'why' the consumer should buy from them. But we need those sellers who told us they would support it, but now are not, and not providing feedback (we have email surveyed, encouraged, called on the phone) as to why they aren't. Hope this makes sense?
Lisa Ormenyessy

Lisa Ormenyessy , Business Coach and Marketing Specialist at Straight Talk Group

HI Michael, thanks for that. So what you are saying is its free for the user and for the seller, but, at one point the seller will have to pay for the data? A... read more
HI Michael, thanks for that. So what you are saying is its free for the user and for the seller, but, at one point the seller will have to pay for the data? And, at this point in time you are having difficulties getting the sellers on board?
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Gursimar shah

Gursimar shah , at Webpro India

I feel keeping the things free for some time to promote your product or services is good practice. But i believe that if you offer 100% refund policy for services / product if unsatisfied will be even better than offfering it absolutely free.
We applied same for our Seo services and Web design services and if was more effective than giving it 100% free.

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Manmeet Singh

For promoting your products for free and engaging more and more people to your services or products . You can use different modes of platforms being available on Internet .

Your presentation , product quality and unique services holds the Key .

Its true that offering free sometimes doubts the credibility and that's where you have to create right perception four your services or products to target clients. Always use right platforms to advertise , also offer free services or products for limited times frames.And if possible within free services try offering limited services and for rest full product/service you can always invite them for paid services or products.

Being local Web designers from India we normally offers free services around festival seasons . Only motto being to make people aware more and more about our products and services.

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Julie alexis

Julie alexis , at web development New York

If you want to sell your product free then compare it with other products which is similar to your item and used by users. You can convince customer by telling about the difference and qualities of product. Hope it really works in business marketing. Most of the offshore web designers also use this trick to give some services in low cost to their clients.

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James Norquay

James Norquay , Consulting Director at Prosperity Media

If the product is FREE what exactly is it, If I was selling a free product I would probably list it on OzBargin which is a great community for listing free things and generating traffic. 

Michael Bell

Michael Bell , Owner at Freshnearyou.com.au

Hi James, Not sure if you looked at the site - but we offer small fresh food retailers, roadside stalls, farm-gate sellers, market stall holders a set of onlin... read more
Hi James, Not sure if you looked at the site - but we offer small fresh food retailers, roadside stalls, farm-gate sellers, market stall holders a set of online tools that include inventory management designed to push traffic to their physical location. Thanks for your comment, not sure OzBargin is quite right for it.
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