(Photo by Ramsey Beyer)

If your business offering is technologically based (ebooks, video, software, games, webinars, etc.), you might consider doing something very radical – giving your product away for free. This “Freemium” business model is growing in popularity for good reason – the best way to see if you like something is to try it (for free) to see for yourself.

The common “free” model is to offer a free trial to your service or a limited free access to your product (for 7-30 days). During the time people will not only get to try your product/service, but also see how you interact with them (customer support, online forums, etc.). The “try-before-you-buy” model is proven to remove the resistance people have to paying for something “sight unseen” (it’s not the same to try something with your own hands, rather than trust white papers and expert reviews).

A huge step up from this is to offer your basic product/service for free. Nada. Zilch. No fine print. You make money in upgrades from the basic service after people have fallen in love with it and need more. This is the current model for some email providers, video game producers, and software developers and more famously started with companies that sold razor blades (who gave away the razor, knowing you’d need to replace it with one of their blades). Giving away your product/service should only be done if the incremental cost to adding a new customer is basically zero: you’re only adding someone to your database and sharing a downloadable digital product link.

By making your business revolve around FREE, it’ll force you to be proactively listening to what people desperately need . You need to treat your free offering as if people are paying for it (keeping it up-to-date, bug-free, and visually attractive) – since it’s the first introduction to your business. But to convince someone to upgrade from FREE to paid should be carefully analyzed to identify the high quality solution to your customer’s “pain points” that they’ll pay for.