Headlines

February 25, 2008

Chris Anderson's Free! Why $0.00 Is the Future of Business: 'Just because products are free doesn't mean that someone, somewhere, isn't making huge gobs of money'

Wired | Read Full Story >

From the consumer’s perspective, though, there is a huge difference between cheap and free. Give a product away and it can go viral. Charge a single cent for it and you’re in an entirely different business, one of clawing and scratching for every customer. The psychology of “free” is powerful indeed, as any marketer will tell you.

This difference between cheap and free is what venture capitalist Josh Kopelman calls the “penny gap.” People think demand is elastic and that volume falls in a straight line as price rises, but the truth is that zero is one market and any other price is another. In many cases, that’s the difference between a great market and none at all.


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#1 Matthew says:

I presume this means that I can order Anderson's new book for FREE from Amazon.

Or maybe he's only talking about other people's work and not his own.


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