When “Free” means “More Paid Sales”

A really interesting marketing case was disclosed by Derek Sivers in his post “Emphasize meaning over price = More paid sales“.

In brief:

A band was doing the usual thing of selling CDs for $15. They’d mention it once or twice from the stage, and sell about $300 per night on average.

A consultant asked the band to try a different approach:

1. Say to the audience, “It’s really important to us that you have our CD. We worked so hard on it and are so proud of it, that we want you to have it, no matter what. Pay what you want, but even if you have no money, please take one tonight.”

2. Mention this again before the end of the show, adding, “Please, nobody leave here tonight without getting a copy of our CD. We’ve shared this great show together so it would mean a lot to us if you’d take one.”

It changes the request from a commercial pitch to an emotional connection. (Replace market mindset with social mindset!) Allowing them to get a CD for no money just reinforces that.

The band did this for a while, and soon they were selling about $1200 (+300% increase in sales) per night on average, even including those people who took it for free! The average selling price was about $10.

But the important part came next:

Because every person left each show with a CD, they were more likely to remember who they saw, tell friends about it, listen to it later, and become an even bigger fan afterwards.

Then, when the band came back to a town where they had insisted that everyone take a CD, attendance at those shows doubled! The people that took a CD became long-term fans and brought their friends to future shows.

Think if this approach is applicable in your ISV business.

One Response to “When “Free” means “More Paid Sales””

# Ryanon 23 Sep 2009 at 7:22 am

Interesting story, of course the important (short term) part is not revenue but profit and the anecdote glosses over that.

I.e. they may have made more money selling a smaller amount at a higher price than a much larger amount at a smaller price.

Radiohead found that 60% would just have taken
http://paidcontent.co.uk/article/419-data-on-radiohead-experiment-38-percent-of-downloads-choose-to-pay/

Here’s an example of a software company that is putting this into practice
http : // creately . com / plans