Free Can Be Too Expensive

Monday, October 5, 2015

Over the last twelve months I've been on the receiving end of emails from a professional group. They all spoke highly of their biggest, most impressive event of the year. Industry professionals from my field will gather in great numbers to network and share their knowledge. Best of all, they had reserved a spot just for me! A free ticket was waiting to be claimed. At that price, how could I say no? It might just be a great way to meet some movers and shakers. I might even be able to build my reputation as an expert economist.

Months went by as I waited in eager anticipation. Finally, the day had arrived. Having kept my schedule clear, I was ready. I gathered my business cards, brochures and other paraphernalia. Sure the event was far from my home, but all of those marketing emails had promised me that it would be worth the trip.

The event took place on a university campus, but there weren't any signs pointing me to my event. No worries. My attendance was not to be denied. Circling the area, I finally found the visitors' parking lot. Sure, it was far from the event, but a ten minute walk through the rain was all that stood in my way. There were no signs outside or in, but I found a security guard who directed me to my destination.

Was it bustling? Did I make many new and important connections? I'll let you judge for yourself. Here's a picture.

Even if you are delivering a product for free, it might be too expensive

Do note that a large portion of those in the picture are either employees of staffing agencies looking to collect resumes, or students passing through the area. All in all, the event proved to be a complete bust. Not only did I gain nothing from attending, I actually came out worse for wear. I had wasted significant time and energy preparing for this event and had passed on other opportunities that were scheduled for the same time.

Yes the event was free. Yes, one shouldn't look a gift horse in the mouth. That said, the organization caused significant damage to its reputation and credibility on that day. I would have had a higher opinion of the organization had they quite literally done nothing - had they never announced or held the event.

When you offer a product or a service, don't think that you only have to provide value equal to the payment received. Your customers will always incur additional costs to utilize your offering. For that reason, you should always strive to ensure that the value that you deliver exceeds the total cost to your customers, not just your price. Failure to do so may cause your customers to question your value proposition.

Looking to improve your business and price your offerings strategically? Contact us today.