There's No Free Lunch In Business

Some of my readers had complained about not having sharing buttons on my articles. I've had always listened to my readers' feedback. So, last week, I decided to install a social sharing widget on my website. After all, social sharing will also benefit me in getting more people of my website.

After searching on Google, I decided to go with the social sharing tool called "AddThis". AddThis is a free social sharing widget used by more than 1.5 million websites. The best part? AddThis is FREE of cost. Absolutely no strings attached.

After installation, I ran my website through a website speed testing app. I always do this after installing a new tool to check if my website isn't getting lagged in speed because of that new tool. I found AddThis code to be OK & not impacting the speed that much. However, when I digged deeper I found AddThis, apart from its own URL, was loading another URL called After googling a bit, I came to know that was a 3rd party advertising mediator who extracted website data from AddThis & sold it to advertisers. I would recommend you to Google "" & see the results yourself.

Needless to say, I immediately removed the AddThis widget code from my website. Phew!

But, why do I care? There're other 1.5 million websites using it. I don't know about them but I do strictly care about my privacy. AddThis doesn't inform its users while signing up that they're going to sell their data to advertisers. They've very conveniently revealed that information in their "privacy policy". That's not fair. May be those other 1.5 million websites don't even know that their website information is being tracked & sold by AddThis to 3rd parties. If they know, I'm sure majority of them will stop using these "free" social sharing widgets.

This article is all about these "FREE" stuff & their role in marketing. These FREE stuff can be various formats like:

  • Software
  • Webinar/seminar/events,
  • eBook
  • Reports
  • Consulting
  • Samples
  • Tools, etc.

Move around your head a bit, and you would find these FREE stuff everywhere.

Now, you must be wondering: why on earth do businesses or marketers need to give free stuff?

First, when businesses give something valuable for FREE, they seek time, attention or information in exchange from the receiver. In AddThis's case, it was my website information.

Time, attention & information are the cost you pay in exchange for getting something FREE.

If someone is inviting you to join a FREE webinar in exchange of your email, then your time is what you trade for that FREE webinar.

You give businesses what they want (your time & attention - very scarce in today's world) & they give you what you want (FREE stuff).

Second, because direct advertising isn't working anymore. Gone are those days when you would throw up some banner ads, people would click on those & buy your stuff. Things have changed. If you want customers, you first need to pre-frame, nurture & build a relationship with them  & then gradually take them closer to sale. That's possible only when you've your target audience data like email addresses & phone numbers.

Data, in today's tech world, is a huge business. In fact, in the US alone, digital advertising(display ads, google ads, facebook ads, etc) crossed $ 100 billion mark in 2019. And, you should know that digital advertising relies mostly on data. You can't target someone digitally if you don't know anything about her or him. Example: If I run a facebook ad for my shoes online store, I would like to target only people who're interested in shoes. That targeting is possible only when Facebook knows who're among its users are interested in shoes.

Earlier, in the print advertising world, there was no mechanism to target a specific profile of audiences hence no data was required. Example: If a car brand wanted to advertise its new launch, it would simply advertise in a popular daily newspaper. But, in the digital world, we've tools to know more about our audiences & target them like a laser machine. Sharp & precise. And, that's the reason digital ads are giving far better ROI to marketers than print ads. Not surprisingly, the print industry is in bad shape right now.

Let's look at the other side. Why do people love FREE stuff? Simple. Because FREE is a powerful magnet. We can't resist trying something that's valuable yet FREE. And, as per literature, FREE is a power word that psychologically influences people.

If its FREE, then you're the product.

And, there's nothing new in this, people have been loving FREE stuff since centuries.

A lead magnet is a resource you give to your audience in exchange of their email addresses, names or phone numbers. You must have come across these lead magnets, haven't you? "FREE Report: How I made $ 100,000  in one month".. Got it? That's what a lead magnet is. Once you submit your information & download the report, you've become that's website's "lead", hence the name. For that report (which you thought was FREE), you've unknowingly given the permission to that website owner to sell you stuff for lifetime. Yes, for lifetime, until unless you unsubscribe.

So, let's dig a little deeper. What does actually happen after you give your identity in exchange for a lead magnet.

Here we go:

  • You'll first be served a welcome email that'll try to build a rapport with you
  • Thereafter, you'll be served a series of emails spread over a fixed number of days (known as autoresponder sequence) that'll pre-frame you with valuable knowledge (you may even find product pitches in these emails)
  • You'll regularly be served emails (say once a week) that will provide you with valuable knowledge AND request you to buy a low-priced product
  • After you buy the low-priced product, you'll be served with another related product pitch (in mid price range)
  • If you buy the mid-priced product, you'll further be served with another related product pitch (in high price range). Making sense?

What I described above is also known as "Marketing Funnel". Its a funnel designed to pre-frame, nuture & convert cold leads into customers.

Upsell means selling a related high-priced product to a customer who just bought one of your products. As I explained earlier, upsells are crucial part of a marketing funnel. The objective of an upsell is to maximize revenue & profit per customer. Upsells also can be sold as quickly as during the checkout of a product the customer is about to buy.

Example: You just bought a laptop bag worth $ 30 from an ecommerce store. After completing the purchase, you get an email from the store offering 10% discount on the laptop speakers worth $ 150.

Downsell, on the other hand, means selling a related low-priced product to a present customer. The objective of a downsell is to nudge the customer & increase profit from a transaction. Downsells can also be sold either via email or during checkout itself.

Example: You just added a laptop bag worth $ 30 to a cart on an online store. During checkout, the store pitches a laptop screen protector worth $ 10.

Cross-sell means selling a same-priced product to a present customer. The objective again is to improve sales & margin.

Example: You just added a laptop bag worth $ 30 to a cart on an online store. During checkout, the store pitches a laptop keyboard+mouse set worth $ 30.

Marketers generally give discounts on these upsell, downsell or cross-sell products. Just to make the offer more attractive.

If you've ever paid for a software or subscription then you may be familier with the terms "FREE Plan" or "FREE Trial".

FREE plans means a pricing plan that's free of cost. These plans or tiers generally include only basic features of the actual product. If you want more features than you need to upgrade to a paying plan or tier.

On the other hand, FREE trial allowing access to a paying plan or tier FREE of cost for a limited amount of time say 7 days or 15 days.

Whether its FREE plan or FREE trial, software companies use these as a tool to market their products. Also, these're great ways to give a taste of their actual product.

Note that these freebies generally cost the company in terms of hosting, bandwidth & customer supports. However, companies do understand that these costs are minor as compared to what they're getting in return (an actual, warm & real customers' leads). Once they've your email address, they can use a marketing funnel to convince you to upgrade a paying plan.

Think of any software company say NetFlix, Amazon, Shopify, etc. They all have their marketing funnel based on either FREE plan or trial. And, it works really well in terms of ROI, so they keep using it.

That's how powerful data is. If you've a database of say 1000 leads, you basically have 1000 real people who're interested in your product. Can there be anything more valuable than that (of course except your present customers)?

With GDPR (General Data Protection Rules) in force, companies need to careful in using customers' data. For example: As per GDPR rules, companies offer lead magnets need to explictly mention that they'll be using customer's data to send marketing, promotional offers. Yes, I know, most businesses aren't doing that. However, I'm optimistic that things will change in coming years.