If free can lead to significantly more sales in a real dollars and cents way, one wonders why it’s not a strategy adopted more often.
For example, you can get a “starter” iPhone from AT&T for 99 cents right now — and they were giving it away for free a little while ago. That’s because AT&T really makes its money with its data and voice service plans, not from the hardware.
So why aren’t more companies following this strategy? Maybe they are and we just don’t know it. Which leads me to my favorite story that I heard at a party I attended over the recent Christmas holidays.
A small group of us were talking about how hot the Kindle has been, even before the latest version, the Fire, came out.
One member of the group then said. “My son recently graduated college. He got a Kindle. All was fine for a few months, but then something broke on it, and the service folks at Amazon told him to send it in to get repaired.
“He did, and then several weeks later he got a box from Amazon. He opened it, and it was a new Kindle. But then he got ANOTHER box from Amazon, and it was ANOTHER new Kindle.
“Then he got another one. When the boxes finally stopped coming, he had FIVE new Kindles. Five. Can you believe it? My husband and I told him to send the extra ones back. But he didn’t want to. He said he wanted to give the extra Kindles to his friends.
“We warned him that if Amazon realized their mistake and wanted the other Kindles back, they might not take too kindly to him saying he had given them away. We told him it would be his financial headache, not ours.”
The man standing next to her took up the story from here: “So he gave my son one of the Kindles. All he told my son was that if it broke, don’t send it back, because he was worried that then it might be traced to him and it would open up a whole can of worms.
“So everything is fine for about six months. But then the Kindle he gave my son broke. My son either disregarded the instructions not to send it in to get fixed — or forgot about that instruction. In any event, he sent it in to get fixed.
“Sometime later he gets a brand new Kindle from Amazon.
“Then he gets another one. He was hoping they’d send him more, but he only got two. He gave me the extra one.
“I can’t wait until it breaks.”