The Power of Free Stuff

Is offering products and services at no cost a good retail strategy?

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Last night, I went to a free yoga class at Lululemon, the popular yoga clothes company. The store near my office offers classes—at no charge—every week. When I got home, my husband asked me if I bought any of the stylish clothes hanging on the racks near the yoga practice room. Of course not, I told him. But I was tempted. And I might purchase some soon. "That is how they get you!" he said.

He was referring, of course, to the traditional belief that nothing, not even free yoga classes, are really free. Lululemon might be offering these classes, led by skilled teachers, but isn't the company really hoping that at least some of the visitors will turn into shoppers? That question brings up Chris Anderson's argument in his book Free, where he suggests that giving away products and services for free can be good for business. (That's one reason why Amazon offers free shipping on orders over $25—the deal entices people to buy a second book.)

In Lululemon's case, the company benefits from offering free classes in at least two ways: First, it gets potential customers (like me) into the store. And second, it reinforces its reputation as a company that really cares about the community and about yoga. By hiring experienced teachers to lead a class for an hour, it's able to broadcast that message for about the price of one of its jackets.

I contacted Lululemon to ask why they offered the free classes and if the company expected visitors to make any purchases. I haven't yet received a response to my questions, but I'm guessing the answer would be "no." Because part of the appeal of giving away something for "free" is that you don't expect anything in return, even if you do.

Have you been the recipient of free products or services from companies? Did the offerings entice you to make purchases you wouldn't have made otherwise?

(Free trial periods, on the other hand, the topic of yesterday's blog post, are usually best avoided. See: "The Dangers of Free Trial Periods.")