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Is your product less valuable if it`s free?

mymobimindermymobiminder subscriber Posts: 5
edited April 2008 in Grab Bag
I offer my service "My Mobi Minder" for free for the individual to schedule reminders that can be sent to their phone via text message.  I have minimal expenses so with advertising I am able to offer the product for free.
We recently launched a Mobi Minder for business product that I also wanted to offer for free, but several people have told me that I should at least charge a setup fee.  Because a large business will not see a value in it if it`s free.
Is this true?


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    besthealthbesthealth subscriber Posts: 4
    It depends on the service/product that is free. Many companies give out free services because they have other ways of generating income and their service is great.  We have yahoo, google, my space accounts among many others where we are able to use their services for free and have networking opportunities that are valuable to us.
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    mymobimindermymobiminder subscriber Posts: 5
    CraigL and besthealth,
    Thank you for your comments.  Very good points.  So it seems that the real answer depends on a full disclosure of "why" it`s free, or just the overall perception of the product`s value.
    Great stuff, thanks.
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    dwarshagerdwarshager subscriber Posts: 0
    I have an online sports community, in which we offer athletes, teams and clubs the use of our platform and tools for free. Like your product users or end consumers are used to the wave of free social networks, communities and applications usage, which are quite difficult to charge users a fee for the service. You could always offer a premium feature to these users for a small fee (but it would have to be significantly small - under $5 per month). However, B2B is quite different in this case. From my experience you can offer a free trial period to these businesses but they would feel better if they paid a monthly fee. To them its not about the money but rather the convenience and efficiency of their employees (cost/benefit). This is specific to larger companies.
    For smaller companies they would be quite skeptical about free services because they are using it for their business (their baby) but this would also apply to free services. Here I think a trial period and a low fee could be a good idea. However, providing YOUR product for free to business users would be a good thing IF the owners are internet/mobile savvy and are not opposed to trying new products AND that your service is not an application they would need to download. This would ultimately boil down to who your target market is.
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    mymobimindermymobiminder subscriber Posts: 5
    Thanks guys, this is very nice to have a venue to discuss this stuff.  Your thoughts have been very insightful.
    Happy Monday!
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