15 Apr Freenomy or Freenomics – A strategic tool for creating disruption & gaining Market share.
My inspiration for writing this article comes from telephone card vendors distributing small pamphlets outside popular malls/hypermarkets in Dubai/ Sharjah.
My article is dedicated to all hardworking people who make their living by selling telecom products & services.
How often do you come across a pamphlet or brochure which says, broadband 4G connection free for 4 months including the hardware if you subscribe to it for a year?
“Lease now and avail 4 months EMIs free” – in case of realtors.
As a management professional and hardcore marketer, this aroused my curiosity as I felt there is a science behind giving anything Free in lieu of a subscription. How does the economic model work?
Why Google is offering its search engine as free to worldwide users?
Why Skype is offering free VOIP calls and video chats free to its users?
Why YouTube is offering free video content to its viewers?
Post deep diving myself & doing research on this topic, I came across an interesting term i.e. Freenomics… which I shall explain very briefly:
Free-nomics is a business model that promotes the idea of businesses giving away their goods/services because it will result in more customers entering the market.
This is different than Sampling which is just giving away some samples in hopes of attracting new customers or doing pro bono work to help a charity or singular individual.
It involves giving away something for free to everyone and for an ongoing period of time.
While Free-nomics is not a new concept, it has certainly gained in popularity by those using social media. Some examples outside of social media include Skype letting people use their basic service for free to do video calls and Google’s free email service to attract users, which in turn, hopes to attract advertisers.
a) Evolution and where are we heading:
Our society has drastically changed over time. First, we used to have the Agricultural age, followed by the Industrial Age. Today, we live in the Information age.
What is next? (That’s the big question)
According to many, it is actually our creative power, our brain! It is our limitless ability to generate new IDEAS, imagine and create new opportunities, conceive new products or services, invent new business models. Note that we are all equipped with this idea generation ability: it is given to us and it is FREE to use.
For the first time in our history, we are approaching the age of UNLIMITED resources. The Internet has just accelerated this trend. IDEAS are the new currency in the new economic world.
The dominant business model on the internet today is making money by giving things away. Much of that is merely the traditional media model of using free content to build audiences and selling access to them to advertisers. But an increasing amount of it falls into the free-sample model: because it is so cheap to offer digital services online, it doesn’t matter if 99% of your customers are using the free version of your services so long as 1% are paying for the “premium version”. After all, 1% of a big number can also be a big number.
If you want uninterrupted videos on your YouTube, you pay some amount for browsing your favourite shows without any advertisements.
If you want more storage (above 5GB) for your data on the cloud, you pay some fees for buying cloud storage space.
You can listen to your favourite songs online free but if you want to enjoy same songs in offline mode (download) you need to pay minimal subscription fees to the app service providers.
- b)Creative disruption:
Bandwidth too cheap to meter/measure gave us YouTube, which is revolutionizing and possibly destroying the traditional television industry, and Skype, which is disrupting the phone industry.
In the Aviation sector, Ryanair or for that matter our Indian airline i.e. INDIGO, for instance, has disrupted its industry by defining itself more as a full-service travel agency than a seller of airline seats.
Many companies have got it. They have successfully entered this new age, Idea Age, the age of unlimited resources.
They have offered:
FREE (Google), FREE e-mail (Hotmail), FREE or unlimited Internet access (AOL), FREE ways to connect with friends (Facebook, Skype), FREE video entertainment (YouTube), FREE e-cards (Hallmark)…even
FREE cell phones based on purchased minutes of service –commonly called as Payment plans (Etisalat/ Virgin mobile/ Du)…
“FREE Strategy” will soon be required part of any marketing plan.
In case you want to know & develop Freenomy strategy for your brand then I would be more than glad to share my ideas acquired while researching & closely studying this topic. In fact, I am in love with this term “Freenomics”.
Believe me, it’s the most exciting times & period for our generation since Information is never an issue.
You can reach me on email@example.com in case this topic also excites you.