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Authoritative PPT Summary
This is a set of "The Future of Free Commerce" reading notes PPT, with a total of 13 pages;
Business models in the Internet era.
Chris Anderson/Author
No.1 What is free?
Baidu Encyclopedia
Relative to fees, there are no fees; there are no fees, and various tangible or intangible things that are not supplied in the form of monetary exchange. No charge, we provide you with what you need for free.
Chris Anderson
The new "free" is not a marketing strategy that takes out from the left pocket and puts in from the right pocket, but a new type of excellent ability to reduce the cost of goods and services to zero.
economist
By lowering entry barriers for customers and expanding production scale, free of charge reduces production costs, increases profits, and allows money to flow between different products, between people, between the present and the future, and between markets that do not deal with money and the money market. transfer.
No.2 Can it be profitable if it is free?
Amazon achieves higher profits with free shipping
Everyone who has used Amazon's online book buying service knows that if you purchase more than $25 at a time, you can get free shipping. This free shipping service means that book buyers who only want to spend $16.95 on a book must purchase another book to enjoy this service.
Amazon's offer has worked wonders. The rate of online book buyers buying a second book has skyrocketed, resulting in higher profits.
Google improves advertising performance through a variety of free services
As we all know, most of Google’s services are free.
Every post on your blog provides more information to Google's web crawlers and indexes, helping them to provide better search results. Every click on Google Maps provides more information about consumer habits, and every email in Gmail is a clue to the various social networks in our lives, with the help of which Google can develop new products or improve advertising performance.
No.3 Free model?
direct cross subsidy
Use some free stuff to attract consumers, thereby increasing consumers' purchases of other products.
tripartite market
In the process of free commodity exchange between producers and consumers, third parties pay to participate.
Free plus fee
Divide its products into two types, charging free for consumers who use the regular version, and charging for the "professional version" with more functions.
non-monetary market
Manufacturers attract consumers with free products in order to improve the reputation of the manufacturer.
No.4 Can all free models be successful?
Product scale
A scale that is sufficient to spread the marginal costs to the minimum. To reduce the marginal costs of digital products to very small or even close to zero, an important prerequisite is to have a large enough scale to spread the costs.
mental cost
Free things require certain measures to attract consumers' attention. From a psychological point of view, it is often difficult for consumers to pay attention to free things. On the other hand, free things will make consumers consider whether it means not using them. Pay money.
money cost
The maintenance of the free model requires costs. For enterprises, the cost is a big stumbling block to implement the free strategy. To continue to implement this strategy, sufficient capital support is required.
No.5 What will we encounter in the future?
Ten rules of free-to-play
1. Digital products will become free sooner or later
In market competition, prices will fall to equal marginal cost
2. Physical product manufacturers also hope that their products are free, but they are not active in this regard.
Manufacturers restructure their business strategies to give away certain products for free when selling other products
3. You can’t stop free
4. You can make money from free
The free business strategy expands the company's visibility and enables the company's products to be known to more consumers.
5. Redefine your market
6. Adopt a free strategy early
If the cost of the product is close to zero, it is only a matter of time, not possibility, that it becomes free.
7. Sooner or later you’re going to have to compete with free
8. Accept wasteful behavior
If an item is so cheap that you can't accurately calculate its cost, don't do it
9. Free makes other items more expensive
Every form of abundance creates a new scarcity
10. Manage abundance, not scarcity
No.6 Controversy over free model
Many economists are controversial about the theory of free model
The internet isn't really free because you have to pay for access!
The Internet is just a carrier of information. The carrier is not free, but information is usually free.
No cost, no value! !
The only measure of value is money, not cost. And the attention and reputation that comes with being free on the Internet can easily be converted into cash.
Depleted oceans, dirty public toilets, global warming are all the real price of free! ! !
This may be a problem in the real world, but in the field of digital information, the environmental cost is not a problem.
The free business model is actually not as simple as imagined. It also requires too much capital, technology, and knowledge support. If you only see the benefits and act rashly, there will be only one result, and you will become a stepping stone for others.
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