Small Business Articles from Make-it-Fly®
To Give Or Not To Give
By Victoria Munro
The Internet is changing the way we do business. Today, an abundance of very useful services and products are available free on the web. Add to that a growing awareness of our responsibility to give back to the community. As business owners, we are being challenged to rethink the place of giving away services and products gratis.
At Make-it-Fly®, we’ve aimed to demonstrate and encourage a culture of giving. But entrepreneurs need to ask what and how much they’re willing to give away, and what goods and services they’ll charge for to help them distinguish between the pros and cons of giving stuff away.
The Upside of Giving Stuff Away
There is much to be gained by giving your services and/or products away. Nancy Levenson, founder of NamasteWorks Yoga + Wellness, LLC, in Highlands Ranch, CO, launched her new yoga studio by freely giving to her local community. Partnering with the local city government, she offered free ‘Yoga in the Park’ sessions each week for three months. During this time, she never solicited business. At the first session, 201 local residents showed up and hundreds more enjoyed participating over the summer. This involved a significant investment of time and energy. “You have to embrace it [giving] without expecting to get back,” Nancy explains. “It really is turning the paradigm from selling to giving, and then letting the giving turn into sales.”
The results were excellent. She gained many new clients and a greater understanding of her local community, where she because quite a celebrity. As a market research project, it provided invaluable information for her business start up. And, since the local media covered these events, she also received a lot of very positive free publicity.
If you’re road testing a new product or service, offering it free initially (even a scaled-down version) can provide valuable feedback and testimonials you can use later to refine and market it. Also, giving away advice through writing or speaking can help you become known as an ‘expert.’
There are other less tangible but still valid ways to give. In her new book The Whuffie Factor: Using the Power of Social Networks to Build Your Business, author Tara Hunt describes the value of giving non-tangible gifts that build relationships and develop trust. Comparing the ‘gift economy’ with the ‘transactional market economy,’ she writes, “Gifts create bonds and reciprocal connections between individuals; whereas market transactions, including those that are free, are transactional and impersonal. Gifts on the other hand result in interaction between people and thus are highly personal.”
Giving Tangible Gifts
Expressing your appreciation to clients by giving thoughtful gifts need not cost a fortune and can keep you in mind and strengthen relationships. If you can relate the gift to a hobby you know your client enjoys and personalize it, it will be even more meaningful.
Cause-Related Marketing—Another Way to Give
If you’re passionate about a worthy cause, it makes good business sense to promote this in your company marketing. When you pick up the torch for something bigger than yourself in this way, it’s emotionally fulfilling, generates community goodwill and differentiates your company from your competition. People like to do business with companies that stand for something beyond profit. Choose a cause that’s in line with your values and one that your target clients can relate to and feel good about supporting.
Because his son suffers from autism David Veal of Veal Creative is passionate about helping families who face this challenge. Last year he spent over 100 hours working with an ad hoc committee to create Rides and Rods Weekend. “It took a toll on my business,” he says. “But I don’t want other families to have to face this ordeal the way we had to. I want to be part of the solution. And I’m doing what I love to do for a meaningful cause. Plus, giving is what makes us all feel really, really great.”
The Freemium Business Model—Will It Work?
Made possible by the Internet’s low-cost distribution channel, this relatively new business model is being used by some of the largest as well as a myriad of small online businesses. There’s been a lot of press lately about the freemium business model, which basically offers a service free to a large number of people in the hopes that some will upgrade to a premium paid version. In his latest book Free—the Future of a Radical Price, Chris Anderson, editor of Wired Magazine and author of The Long Tail, gives an overview of how the meaning of ‘free’ has changed in the last few years and how, in the digital marketplace, the most effective price is no price at all. His critics are unconvinced and there’s much debate on whether this model can be economically viable in the current economy.
The Downside of Giving Stuff Away
Some claim that giving your services away may devalue what you do, but in today’s crowded marketplace, this may not be valid. However, for those who love what they do, genuinely want to help people and need new clients, there is a potential problem. If this is you, it’s especially important to decide where you’ll draw the line—what you’re willing to freely give and what you will charge for. Then, stick to it.
Decide What and How You’ll Give
Though the results of giving are hard or impossible to track, when done sincerely and with some forethought, giving stuff away for free is almost always a worthwhile investment of your resources. As we head into holiday gift-giving season, brainstorm ways you can give back to your clients, potential clients and your community, then create a plan and start giving.
© 2005-2009 Victoria Munro.
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About the Author: Victoria Munro is
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