Why $0 Is Never Really ‘FREE’
The price of free is just too expensive
We live in an era of ‘free’.
We are surrounded by so many free products and services that in
many cases we resent the idea of paying for something.
Have you ever paid for an app on the Google Play Store or Apple App Store?
Why should I pay if I can get it for free?
The price of apps varies between $0.99 to $6.99. We all agree that it isn’t
a lot of money, especially if it is for an app we’ll use for months or years.
But most of us refuse to pay for apps as a rule. We normally search for an alternative. The free app. In fact, the forecast for 2015 was that two-thirds of US mobile users will only download free apps. It is no wonder that in 2018 over 94 percent of Android apps are offered for free.
If there are so many free apps — why should we pay?
We don’t value the time and money the developers spent — we want it now and we want it free.
This behavioral pattern is not only exclusive for apps, though.
Take books, for example. Since the appearance of digital books, there has been a tremendous increase of books available online. It has become easier to publish a book. All you need is to write one and upload it online. That’s it.
And there are millions of e-books offered for free. Therefore, many people decide not to buy the latest best-selling fiction and find a free e-book instead, as if it was the same product. While both are categorized as ‘fiction books’ they are definitely not identical.
And what about music?
Once music was available online, although illegally, people stopped buying CDs. They had a way to get the same product for free. The low-quality MP3 files and the financial damages caused to the artists were irrelevant.
Would you pick the truffle?
According to Dan Ariely, Professor of Psychology and Behavioral Economics, once something is labeled ‘free’ — we cannot find the negative value of it. As Ariely explains, a wealthy person would stand in line to get a free Ben & Jerry’s, even though the cost of the ice cream is a mere $3. This person wouldn’t think of the time wasted by waiting in line for his free ice cream.
In this video, Dan Ariely shares an interesting research he did. He asked people to choose between a luxury truffle that costs 25 cents and a chocolate piece that costs 1 cent.
What would you choose?
Most people chose the truffle. While it was more expensive, people were happy to pay for a richer taste.
Next, Ariely asked them if they were likely to change their choice if the price was decreased by 1 cent each.
Which option seems more appealing to you now?
What did most people answer?
You guessed it. Most people preferred the free chocolate. It was too hard to pay for the luxury truffle when they were offered something else for free.
The ‘pain of paying’ is not linear
We choose a free app instead of a paid one for the same reason.
A paid app is likely to be more user-friendly having extra features and fewer bugs —yet the ‘free’ label seems more appealing.
But when we use a free app, we are exposed to hundreds of pop-up ads. Sometimes we even have to watch a 15–second ad video before continuing. Yet we don’t pay $0.99 to remove the ads because of the pain of paying.
A great example is ‘Minecraft’. It is an addictive popular game, available on many different platforms and one of the most paid-for apps. Those who play it don’t have a free alternative, so they pay $6.99 for it.
Ariely suggests that we don’t get twice as much pain for paying twice as much money. Therefore, paying $0.99 cents versus paying nothing for an app feels more ‘painful’ than paying $6.99 versus paying $0.99.
Here is where it gets interesting —
When I go to Starbucks they ask me: “which size would you like — medium for $4 or large for $4.99?”
I usually choose the large size because an additional 99 cents doesn’t seem like a lot of money. And it really isn’t. But those are the exact same 99 cents
I refuse to pay to eliminate those time-consuming ads.
Repeat after me: there is no such thing as ‘free’
We always give something in return for a free item or service.
With free apps, for example, it isn’t just the ads we are exposed to.
In 2017, most revenues generated by mobile apps came from in-app purchases. We download a free app thinking we have nothing to lose. But once we get hooked we start paying for in-app items.
And here is another example — I buy from a supermarket that provides free deliveries for orders above $50. Normally, the delivery charge is $3.
It always makes me buy more so I can reach the $50 threshold.
When my grocery shopping costs $47, it seems logical to add items for $3. My total would still be $50 and I get a free delivery on top.
But is it worth the clutter (or the extra calories...) of the unneeded
items I bought?
Wait, there’s more —
When we think of our ‘free’ Amazon deliveries and videos, we forget about the $100 we paid for our Amazon Prime membership. That is the beauty of ‘pain of paying’. When you pay in advance, you feel less pain.
Here is one last example — some of my friends fly with the same airline time and time again. “Only three more flights I’ll get a free flight,” they say with excitement. They don’t bother comparing prices before they fly and they end up spending more just to get that one glorious ‘free’ flight. It is too appealing.
Quality = Paid
I read numerous articles about Medium’s membership. Most people seem not to like it. And I am not surprised. Once again, it’s that price of ‘free’.
Many people say that since there are hundreds of free blogs available out there, they don’t see a reason to pay for a Medium membership.
Is it really a valid comparison?
Medium provides artists and readers a clean, ad-free platform.
Medium doesn’t track, collect, store or sell our information (as far as I know!)
Medium pays writers for their time and creativity.
Some paid articles on Medium are of great quality and you will never find them elsewhere on the web for free. And if you do — you will have to pay by being exposed to ads and/or by providing your email address.
There might be other alternatives that I am not aware of yet, but it seems clear to me that a paid membership is the way forward —
free = quantity, paid = quality.
“The idea that you will make the right decision every time is very unlikely.” ~Dan Ariely
Once again, repeat after me: there is no such thing as ‘free’!
And ask yourself — what is the price I am willing to pay for ‘free’?
Clap along if you feel like that’s what you want to do 👏
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