It’s been a while since my last post…hope this will make it up.

Today, I want to talk about an article a good friend of mine sent me. I’m a big fan of Wired (but never have subscribed :P) and this article reminded me how great the magazine is.

The article was written by the editor-in-chief, Chris Anderson and talks about how all digital products will ultimately become free. The production costs and overhead for producing these digital products (such as software) will be so cheap that [digital products] will become free. And the success of online businesses will be determined by the effectiveness of converting free users to paying users via bait-and-switch methods.

Although I disagree with Chris that ALL digital products will become free (since not all forms of online businesses can survive on the bait-and-switch model), I have, however, learned an important lesson.

If you are offering a product for dirt cheap, might as well make it free and find some ways to turn that free customer into a sale.

The reason for this is that when you offer a product for cheap, the image of the product will also become cheap (like the price). But by making it completely free, not only does the user start to rely on the product, but they associate positive feelings toward the company that produced it, reducing the need to PR the hell out of your company. As a bonus, you also get more eye-balls on your product, which may lead to more conversion of sales.

Read the full article here - Free! Why $0.00 is the Future of Business

- Peter Kao