3 Steps To Making Money By Giving Something Away For Free

3 Steps To Making Money By Giving Something Away For Free

Typically when one thinks about earning money, it isn’t by giving things away or working for no pay. However, in recent years we have seen a vast increase in the number of products and services that offer at least something up front at no cost, with the expectation of paid users down the road.  Many mobile apps provide basic functionality at no cost, with in-app purchase options, and we all use websites that offer free services and make their money on advertising and specific paid features.

I recently had a great success doing this very thing, and my 3 Steps outlined here are based on personal experience.  As a developer, I’m focused on software and technical solutions, but I’m hoping you can apply the same concept to your own business in some way to achieve a similar result.

Step 1: Create Your Product or Service

This first step is the most critical, and probably the most difficult. However, it could also be the most fun if you choose to spend some time to come up with something new and exciting. If you’re going to give away a product or service for free, it needs to be something that people want, and that you can feasibly distribute with the understanding you may get no returns. It should also be something that will make people think of you when they want something similar again. Keep in mind that you don’t necessarily need to create something new. Maybe re-packaging an existing product or service as a free offer will be enough.

In my case, I chose to develop an app that did something fairly common, but did it in a very unique way. I also decided to use technology I wasn’t familiar with so that it would be a learning experience as well.  The end result was Tremor Tracker, an app that displays earthquake information on an interactive globe. The key decision here was making the download free, where so many apps went with the typical $0.99 price point.

tremor-tracker

Version 1 was pretty rough around the edges, but it got things going. I followed it up with some updates, and after a while it started to get some attention.  Being free made it easy for someone to download and try, and since everyone can relate to earthquakes, the basic concept was intuitive.

Whatever it is you choose to give away, be sure it is something you can manage, as well as something a lot of people will understand, like, and will want to share with friends.

Step 2: Spread The Word

So you have your free product or service ready to go.  Now what?  Your goal should be to get it into the hands of as many people as possible.  That doesn’t necessarily mean everyone.  Your target market should still be your usual one, but if it is feasible to do so, getting it out to a much wider audience won’t hurt.  For example, not everyone on the street needs my web development services, but they might know someone with a business who does, and the exposure and word-of-mouth advertising you’ll be getting with your free product is what you’re really looking for.

Don’t expect this step to be quick.  I went back to check on my initial launch date for Tremor Tracker, and it was almost two years ago.  I had many people tell me I should be charging for it, and I probably could have made some money that way.  However, those short term gains would be very small compared to the long term benefits I’ve received by keeping it free.

Here are a couple of ideas on how to promote your free product:

1. Get your friends, family, and co-workers on board.  They’re often very willing supporters, and will be happy to share your idea to their friends, on Facebook, Twitter, etc.

2. Use as many online resources as you can.  Social media sites, your website and blog, etc, are all ways to spread the word at no cost.

3. Have a set of business cards made that specifically features your free product, along with your contact information. I hand these out to anyone I meet who looks like they might fit my target market (in my case, it’s the person who can’t put their iPhone down in a restaurant).

The possibilities are endless, but the more people who get your product will find out about you, and increases your chances of earning future revenue.

Step 3: Make Money

Where your additional revenues come from, or how it happens is largely dependent on your business.  If you have a retail store, it might be a simple increase in sales over time.  If you’re doing larger client projects, progress might only be seen over the long term when someone contacts you based on their exposure to your free product. Try to find a way to track the connection between your free offerings and sales. Even if it takes a while for it to create revenue, it’s nice to see people making use of your products, or even just contacting you with a question or comment.

I was fortunate to have someone in the mapping industry take note of my app.  They featured it on their blog, and even used it as part of their own business presentations.  I also received a couple of referrals, one which kept in touch with me for over a year.  There was little or no revenue happening even then as I was mainly just giving advice, talking about ideas, etc. But the real success came after months of building the relationship when they offered me some ongoing project work that depending on volume could bring in $5,000 to $10,000 a year in new revenue. Not bad for a referral that started from a free app download.

Summary

Promoting a business by giving things away works.  It works for big companies who sell free coffees, it works for tech companies who want to build huge groups of users, and it worked for me.  I encourage you to take some time, think up a fun project that will be useful, and figure out a way to share it for free.  You never know where it’ll end up!

Create Killer Content For Your Blog
Content is Queen. Killer content is the best way to grow your blog. Enter your email and we'll send you our 20 page ebook 'Create Killer Content For Your Blog' immediately. It's free.
We hate spam. Your email address will not be sold or shared with anyone else.

Add Comment