The Unbearably High Price of 'Free'

The Unbearably High Price of 'Free'

Using the word ‘free’ in your marketing is a quick way to get attention, but it’s also a double-edged sword that has tripped up a lot of businesses.

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Brand Renegades

Discover how two entrepreneurs used unconventional business strategies to turn their startup into a multimillion-dollar company.

June
13, 2021

5 min read

Opinions expressed by Entrepreneur contributors are their own.

One of the most powerful words in the English language is the term “free.” Do any of these phrases sound familiar?”Buy one get one free.”“Get a free gift with purchase, valued at $499.”“Get a free eye examination.”“Try our membership for FREE.””Get FREE delivery”It seems like just about every company uses some kind of “free offer” in their marketing. So why is the term “free” used so liberally?Because, frankly, it works — by appealing to our basic human emotion of greed.The word “free” has appeared in more advertisements than there are grains of sand on a beach. And it goes way back to the genesis of advertising when giving free samples was the best (and only) new way to get customers. So what makes “free” work so well?”Free gets attention. It makes people feel like they are getting a great deal. On a subconscious level, it works in reverse, too — you feel like you’re missing out if you don’t take advantage of something for free.But using the word “free” in your marketing can be a double-edged sword, especially if you don’t use it correctly. Related content: The 5 Triggers of Psychological PricingIs there a wrong way to use the term “free” in your marketing?Absolutely. There are thousands of ways that using the term “free” in your marketing can trip you up, reduce your product or service value, and do irreparable damage to your brand. Let me give you a real example. One of our clients was in the business of producing extremely high-end Italian-made leather shoes and bags for men. Their most famous pair of boots retailed for $3,500. Their most popular bag, a messenger-style laptop bag, retailed for $950. The company’s previous marketing agency advised them that the best way to double their boot sales would be to offer the messenger bag for free.As far as irresistible offers go, that’s a pretty good one, and it did in fact, increase sales of the boots — in the short term. But it was a strategic disaster in the long term because now they had conditioned their clients to expect the messenger bag for free.In other words, by offering it for free, they had completely devalued that product (remember it was the company’s top-selling bag.) Even worse, by offering something of high perceived value for free, they had also damaged their own luxury brand. Why would people ever pay full price again?The good news is that people have a short attention span, and with the right strategic pivot and messaging, you can erase the damage of using “free.” But it takes time.The same dangers apply when you start using discounts in your business. If you discount your products, why would people ever pay full price? They just wait for them to go on sale. When our Italian client came to us, they had a branding and sales disaster on their hands through no fault of their own. Fortunately, we were able to get them out of their pickle by repositioning their products and reinventing their brand — a move that resulted in them being purchased eighteen months later by a competitor.  Moral of the story: Using a free offer can be a slippery slope and must be used sparingly and carefully.Related: The Price Is Right: How to Price Your Product for Long-Term SuccessBefore using “free” in your business, ask yourself:Does this have a real value that we depend on for revenue?By offering this item or service for free, will this adversely impact another related service or product (for example, if you offer the first consult for free, and expect to be paid for all future consults)?Why are we considering offering something for free? What else could we offer that would help us achieve the same result?What if it’s not your business using “free”, but your competitors?Now, if you’re on the other side of the fence and your competitor is offering something for free that you are charging for, it’s time to put your marketing into high gear.Just because there is no money exchanged doesn’t mean that it’s not paid for in other ways — for example, in lost time, huge frustration or poor quality.  Think of the experience and quality of “free” healthcare versus a private plan. Draw these analogies in your marketing to establish your value in the minds of your clients.”Free” is still a mighty word used to grab attention in marketing. But handle with extreme caution, and don’t be lured into using it to stimulate short-term sales at the expense of long-term growth.Related: 3 Lessons About Setting Your Price Learned From a Vegas Prostitute

Why You Shouldn't Hire a VP of Sales

Why You Shouldn't Hire a VP of Sales

Most companies waste precious money that could have been used to created more sales.

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Brand Renegades

Discover how two entrepreneurs used unconventional business strategies to turn their startup into a multimillion-dollar company.

June
13, 2021

4 min read

Opinions expressed by Entrepreneur contributors are their own.

The executive sales leadership function (VP of Sales, Chief Sales Officer, etc.) is a huge role within a company, yet the title has been used in such a broad context that we have diluted the actual role of what the individual actually does. Executive sales leaders are members of the C-suite who are responsible for the executive function of a company’s revenue generation. They are responsible for recruiting, hiring, training and leading the sales team, creating and communicating sales goals and leading the unit that generates most (or all) of the business for the company. They must be able to clearly map the customer’s journey from first contact to post-purchase, create specialization within the roles of a sales force, and define territories and strategy for new markets. They rarely sell.Companies in the early stages of revenue growth are most likely going to get this wrong. If you are a new company or startup and you don’t have successful sales reps or managers on board before hiring your VP of Sales, then you’ve made a huge mistake. Hold off on hiring a VP of Sales until you are ready to scale your existing sales team — not just to start your company’s selling efforts.Related: 3 Reasons Marketing Is The New SalesBefore you hire your next VP of Sales, take a moment to decide if your company needs this role, and if so, how it should be filled. Don’t hire a VP of sales until it’s time to fund and grow a sales team.If you are an early-stage company, your first sales hire should never be a VP. It should always be a sales rep — a very good sales rep. While a VP may make you look good to the board, what an early stage company really needs is a “Super Rep.” A Super Rep is the person who can be the No. 1 advocate for your company, who begins bringing in revenue, and who goes out and simply sells, sells and sells some more. In contrast, a good VP of Sales should only spend about 10% of their time selling; the other 90% is spent strategizing, coaching and managing.On the other end of the spectrum, well-established companies can miss badly on their VP of Sales hires too. Once you’ve established your company and are ready to hire (or change) a VP of Sales, the error stems from promoting one of your top reps or managers into the role. This ends up being a mistake because often the VP spends too much of their time directly selling and working with customers and not enough time building training programs, strategizing new product offerings, coaching reps on maximizing sales, pondering joint ventures, managing board and executive team expectations, and leading the sales force.Related: 3 Sales Tweaks That Could Change The Game for Your BusinessWithout the VP of Sales performing VP of Sales work, a company’s sales system breaks down. The VP may think they are doing the right thing. Rather, the company has put the wrong person in the wrong role by promoting a rep or manager. It is worth going outside of the company and hiring the right person for the VP of Sales in order to ensure the role is filled correctly and the company’s needs for that role are met.The Vice President of Sales is a role that can make or break a company, which is why it’s crucial to find the right person to fill the position. It’s not the first hire in the sales organization, and they probably don’t work for your company today.Related: How to Build a World Class Sales Team

Add a Morpheus to Your Mix

Add a Morpheus to Your Mix

A COREageous CEO listens to the good, bad and the ugly.When passion takes hold and our vision becomes invincible, our mirror gets cloudy and we’re apt to act on murky and idealistic perceptions. It is comfortable to surround ourselves with people who share the same mirror, instead of those that come from a more realistic perspective.Include people in your organization who will expose the weaknesses you may have denied or overlooked. As in the movie, The Matrix, the character Morpheus delivered the truth. Consider forming a small team of Morpheus’s that will help you see clearly. And will you listen?In the highly recommended book, “The Art of the Start 2.0” the author, Guy Kawasaki, suggested having a Morpheus for each aspect of your business:Research and developmentOperationsFinanceEthicsKawasaki claims that a Morpheus is the yang to the CEO’s yin. The CEO decides “what” while the Morpheus identifies “what could go wrong?”Could having a Morpheus on your team safeguard your venture?Have trouble listening to the hard stuff that could save your startup? Listening is “my thing.” Contact me at [email protected]

The Hunter and the Artist That Struggle & Intertwine to Bring Nature to Life – the True Essence of SN

The Hunter and the Artist That Struggle & Intertwine to Bring Nature to Life – the True Essence of SN

You won’t find a Wikipedia page about this somewhat elusive artist; despite the fact his profile continues to build year upon year. SN, equally inspired by nature and fantasy, is an imaginative artist. His use of contemporary mixed media artworks separates him from just about every other artist out there.SN the artist uses his artwork to bring his unique perspective on the world to life. Many of SN’s most famous works are easily identified through his use of butterflies, which he will often use to decorate angelic women. In sharp contrast, he has also decorated fierce animals with butterflies too.Whatever SN feels like decorating on a particular day, he will do. And those who wish to host his works don’t seem to mind what direction he takes either; all of SN’s works have been exhibited all over the world. His original pieces currently hang in galleries on six of the planets seven continents. It’s a pretty fair bet that, should they ever choose to build a gallery in Antarctica, SN would quickly go seven for seven.Where it all beganPhotography was SN’s first love in the world of art. At 12 years old, he traded in his bicycle for a Canon AE-1. Makes you wonder just what bicycle SN had and what the price of the AE-1 was at the time, as whilst the AE-1 was certainly one of the cheaper SLR’s on the market upon launch, that does not mean it was cheap!Still, that is the way things happened, and the AE-1 allowed SN to express his love for nature and fantasy in a way he had never previously known through photography. This fantastic piece of technology from Canon still fetches a hefty price on eBay today, and there is no shortage of working examples out there. Perhaps you might want to purchase one, and stare through the lens to see if you too feel inspired to create fantastical artworks that could lead you into a career as a professional photographer?Moving on…In 2006, SN was seeking new inspiration; his earlier works focused entirely on photography, but now SN shocked the art world by presenting a new collection of mixed media artworks. This new stylistic collection was completely unique at the time, highlighting the artists passion for nature.SN states that his works prior to this point had been focused on the “synergetic connections of humans and their natural surroundings”, a far cry from the more politically influenced pieces that he has created in recent years. SN’s recent works attempt to express the notion that modernization can always triumph over the forces of nature.  You will see this most clearly in his works which showcase the interactions of Native Americans and the white men who later came to the Americas.And Back to the MagicalSN appears to occupy a different special environment to many of the rest of us. He conceptualizes images from the fantasy world that he sees around him and somehow manages to turn these into fully realized visions of emotion and color. The latest pieces by SN are said to be the outcome of a recent journey into a three-dimensional alternative reality. It’s tricky to interpret this without making assumptions, but it is certainly worth noting that SN is a multidisciplinary artist, who appears to be going back to his roots by using butterflies, overlaid with drawing and painting to create an imaginative palette of ink types, colors, and mounted elements, such as his trademark butterflies.A Short ConclusionThe uniqueness of SN’s work makes it difficult to draw a conclusion about this artist without referring to his own website. The conclusion given there talks of SN’s desire to captivate his audience, capturing their hearts with sentimentalist ideas and exquisite imagery. An unashamed romantic, SN states that he feels the need to share his creative eye and the beauty that he sees with his audience – and wants them to fall in love with the pieces that result.It seems SN is making excellent progress towards his goals as of 2021.About the Author

Build a Strong Defense!

Build a Strong Defense!

Marcia from Highland Park, Illinois writes: I started an online business for working mothers that’s requires work wherever I go. But, when I visit my parents, I’m also visiting their depression and their clutter. I’m significantly affected by their negativity. Back at the office, it takes me a few days to get my mojo back. I see my response to negativity as human, but it slows me down precisely when I need to speed up! Any tips?        It’s  easy for our creative energy and optimism to get dampened by negativity around us: sadness, jealousy, anger, disparaging talk, neglect. The Debbie-downers among us may have some good reasons for their mental state. Most people want to be happy, but they don’t know how. Pep talks and denying their realities waste energy. To be kind to those in pain, to survive the rigors of entrepreneurship and to defend ourselves from negativity seeping into our mojo we, the COREageous, need to cultivate healthy defenses. These actions also serve to lift the spirits of those around us. Try to:1) Get up early before everyone else, stir up the thoughts that drive you: your personal vision, your WHYs, gratitude or personal affirmations.2) Work out for at least 15 minutes, something rigorous, preferably outside.3) Give praise or a sincere compliment to those who are unhappy around you. Listen to connect with them over a meal without expectations for solving their problems.4) Clean up your work space. What’s your plan for the day? How do you want to finish the day with a high degree of satisfaction? Turn on some upbeat music and rock the day!Building a strong emotional core is the cornerstone of entrepreneurial success. Let me help you.Contact me at [email protected]

Tips and best practices for designing fintech apps

Tips and best practices for designing fintech apps

Numerous financial institutions changed traditional banking and finance ways into the business of Financial Technologies (FinTech). During the financial crisis, the FinTech revolution started in 2008, and many banks left-back because of new technologies. Fintech apps make an easy way for users’ money. Today, the industry approaches other finances such as money transfers, loans, payments, crowdfunding, asset management, cryptocurrency, and many different ways to interact with customers and clients.Many FinTech apps have a design that provides a great experience that offers extra features for managing users’ finances more safely. Companies quite often are searching for ways to make their services useful for clients and the corporate side. Business transactions nowadays are easy to understand and use. Because of smartphones, FinTech designers are willing to upgrade the industry. Clients can now use apps that have features that allow them to open a new current account, send and receive a payment, and communicate with customer service. The Process of Creating a Financial AppCreating a financial app is not easy to process, and beginners must pay attention to every detail. If you decide to take the step, you need to know how to include branding, create easy access to tools, put security measures to protect delicate data, and create an interface that users can use easily. The primary role of the design of financial applications is their appearance on mobile devices. So, the creation of a FinTech App needs to be innovative and at the same time fit the parameters. The user experience and user interface design companies are involved in designing a FinTech application because they can assist in problems by providing excellent solutions. Best practicesIf you are new in the app designing process, here are some great tips that can help you.Understand the customerYou need to know what your customers are looking for. It is crucial to know the clients’ needs before designing the app. If you want a well-designed app, then learn from the best FinTech apps. They listen and adapt feedback from users, and that is crucial in the designing process.Most FinTech apps are user-friendly, so when you understand what your clients need, the entire team knows what to upgrade on the app. Plus, feedback from users is crucial. Both negative and positive feedback is vital for app designers because they can listen and adjust accordingly and improve the app.SecurityWhen there is delicate financial information, your users will be satisfied if their data is safe while using the app. Security must part of your designing process. Ensure your users know what you are using their personal information when they sign up on the app. Plus, providing an easy way for transactions comes with the challenge of making a secure and safe funds transfer. Paypal applications have peer-to-peer money transfers that require a confirmation from banks and users to complete them. Users will feel safer when using a service they can trust. There are also other payment gateways that you could use.Good TeamIf you want to make a perfect app, then you need a great team. If your team has unique skills, such as web security and business management, they will facilitate the designing process because of their knowledge and skills.Plus, you will have significant benefits from the designing process; more time and productivity. GraphicsGood graphics make information more accessible for users to understand. Every form of visualization, such as tables, graphs and charts, can provide better ways for users to understand their finances.DataFinancial apps demand users to fill out personal information when signing up. If you want users to be satisfied, the process should be rapid, simple, and pleasant. Including an indicator in progress will let the users know their process. It may sound impossible or uninspiring, but designing a FinTech app is a big challenge.Visible StatusWhen designing a FinTech application, it is essential to inform users quite often about the system’s status. Building user trust is very important and makes the user experience coherent. An animation feature that shows a transaction’s status can be a great way to design the user experience.GamificationWhen making user interface advancements on the app, gamification is excellent to consider. Simple tasks like loading screens and verification prompt make a process easier to use. If there is a puzzle piece to solve the captcha, it will be fun.  ConsistencyGreat design has the purpose of connecting the business’ commercial goals and the software development options. So, remaining consistent in all buttons and opportunities that the app has is a design principle you should not avoid. It will help users navigate an application, avoid mistakes, and makes the app look very professional.Background ColorChoosing the right background color and font is crucial. Icons and logos should be easy to locate and navigate, so the background should match with them. The night mode that Twitter and Messenger created is an excellent example of it. Users can adjust to night lights with the night mode instead of using white or another color background. It is better for their eyes health. Color PalettesWhen speaking of color palette, we refer to the most crucial thing. Did you know that a color palette can affect the user interface of an app?Why?Because color palletes are more than just graphics, they provide certain types of information. For example, in finance, the red and green colors represent the buy and sell, so be careful when choosing your design colors. FontsThe font is also significant when designing the FinTech app. The essential fonts to use are Roboto, Lato Condensed, and Titillium Web. Plus, you should check the appearance of individual characters such as $. It is pretty necessary because the finance world is all about figures and numbers. LocalizationThe audience will continue to grow if your company grows. It would help if you considered addressing international travel and purchases. A great example of app localization is the example of PayPal. It can convert money (with a conversion fee) and allow people from other countries to interact.Fintech apps are a new era. Putting customers first and the design of the app is essential for the user’s journey in FinTech. Companies are also keen to evolve. Structure and discipline are fundamental when building a business, but innovation and efficiency are crucial. The main focus of the FinTech industry is clients and their needs. About the Author
Bogdan SanduBogdan is a designer and editor at DesignYourWay. He’s reading design books the same way a hamster eats carrots, and talks all the time about trends, best practices and design principles.

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