People don’t value things that don’t have value.

Money

When you launch an event, book, product, dove into the air like Prince, you have to decide whether you’ll charge for it.

Popular rhetoric will argue that it should be free. That if you want a lot of people to get excited about it you should give it away much like the Red Hot Chili Peppers. That makes sense in theory. It would seem that if something cost $10 and something else was free, the free item would be more popular. More people, realizing they don’t have $10, will jump on board with the option that costs zero dollars.

That’s a nice theory, but reality doesn’t always work that way. In fact, I’ve learned just the opposite this fall.

I’ve been holding meetups in cities across the country. During the meetups, I teach about bravery and hustle. It’s essentially an hour long event and it’s free. Of the people that sign up online, only about 30% show up. Contrast that with the paid events I’ve tried. When I charge for an event, 90% of the attendees show up.

Why does this happen?

Because if you pay $10 for an event, you have skin in the game. That might not be a lot of money, but at 6:30AM when your alarm goes off, $10 translates into about $100 worth of motivation to get out of bed.

I can’t explain it, the math doesn’t make sense, but I swear that every dollar you pay for something has roughly 10 dollars of motivation associated with it. A $10 purchase feels like a $100 purchase, a $100 purchase feels like a $1,000 purchase. And we hate to waste money. If we paid for something and then don’t attend it or use it, we feel like we’ve failed. That fear of failure is a powerful force for good in this case.

People don’t value things that don’t have value.

If you want to increase the number of people who sign up for something, give it away for free. If you want to increase the number of people who show up and are invested in what you’ve created, consider charging.

If you believe that what you’ve created will actually help someone change their life, you dramatically increase the chances of the person actually using it if you charge them money for it. You think you’re doing them a charity by giving it away for free but you’re actually removing reasons they’ll use what you’ve created.

Are there some situations where giving away something for free, or in exchange for an email address or info is worth it? Certainly, but remember this:

When something costs us nothing, we tend to invest the same amount in it.

17 Comments
  • David Mike
    Posted at 06:09h, 03 November Reply

    I remember talking to you about this and it is so true. I have also found that when you give someone a life changing book, they never read it. If they buy it the book, they are more prone to reading it. The investment promotes action, even if it is a small amount of money.

  • Judith
    Posted at 06:26h, 03 November Reply

    I have to admit, I’ve been that person who signed up for a free webinar and then did not attend the online event. But not because I didn’t value it necessarily, because I highly valued the content and appreciated the offer of the person hosting it. But I more easily let life get in the way. I didn’t schedule it in and make it a priority and therefore let the urgent get in the way of something I wanted to do. Had I paid, I believe I would have scheduled it as a priority rather than something that would I wanted to do, if that makes sense.

  • Troy Stoneking
    Posted at 06:31h, 03 November Reply

    I agree 100%. This is also being taught right now in an online business course we are taking. Looks like a God thing to me. Thanks for the reminder and confirmation Jon! No feeling guilty when charging for the value of the dream God has given me to share!!

  • Camilla
    Posted at 09:14h, 03 November Reply

    This is spot on Jon! Besides, there are many ways to generously give without constantly giving everything away for free.

  • Stacy Zeiger
    Posted at 10:23h, 03 November Reply

    I think it depends on what it is and what its purpose is. I’ve given away over 1,000 free copies of my devotional Traits of a Military Wife through Kindle’s free promotion days and I’m okay with that because my goal was just to get it in the hands of military wives and many have messaged me or later met me and told me how much they appreciated it, but in that particular audience, I don’t think they would’ve bought it outright.

    For my other work though, no. I may offer something free along with the product though. For example, a free lesson plan guide to go with my workbooks on resilience.

  • Chris
    Posted at 10:40h, 03 November Reply

    I’ll admit to being one of the ones who signed up for your free meet up in Charlotte and didn’t end up going but it was because I couldn’t get the details of the event until I signed up. Once I got the details, I realized that it was too far away for me to get there and then be at my job on time.

    You used to talk about all the free words that you posted online before you published your first book. How does that fit in with what you’re saying now?

  • Jeff Brown
    Posted at 10:43h, 03 November Reply

    I have spent the last 11 months charging for my expertise and experience.

    The key for me has been leveraging the relationships I’ve spent years in some cases building to help spread the word and secure endorsements.

    Why I spent so many years working for someone else before taking the plunge I will never fully understand.

  • Grant Duckworth
    Posted at 11:19h, 03 November Reply

    If I don’t have anything invested in something it’s so easy to blow it off if another opportunity comes up. It’s not something I’m necessarily proud of but it’s the truth…just my nature. Also, nowadays, I’m extra skeptical about free things. I’d rather be charged up front rather than get half way into it and find out to get the good stuff I need to pony up some cash. That’s just irritating and it feels like I’m being hustled…not in a good way.

  • Craig Klope
    Posted at 12:22h, 03 November Reply

    Will Lee, bassist for David Letterman’s band for over 30 years, was a successful session musician before he was hired for the show.
    The show was taking so much of his time he decided to cut back on his sessions. He was already charging double scale, so he upped his price to triple scale.
    The next week he got twice as many calls for sessions.
    Sometimes people think, if it’s free, it must be worth the price you’ve charged.

  • Kimberly
    Posted at 12:59h, 03 November Reply

    I’ve seen this in our business for the past few years when it comes to events, but now it is taking a whole new face in the marketing scene. Free content has been seen as the new black, but when it comes to actually converting into customers, if you give away too much then you diminish the value of the product.

    Thanks for sharing! I’m going to share this with my team as well.

  • Rick Theule
    Posted at 13:21h, 03 November Reply

    I was sick! I’m sorry. I’ll make up for it.
    But seriously, thanks for the reminder. I have a couple of other people pushing me to charge for a couple of items and I haven’t pulled the trigger…yet.

  • Eduardo Suastegui
    Posted at 14:24h, 03 November Reply

    Basic argument flaw: price and value aren’t synonymous.

  • Christiana
    Posted at 17:18h, 03 November Reply

    When I offer workshops I charge for the copies so that I can make the money that I spent on copies back. I appreciate the fact that you provide things for those of us who can’t make your meetups since you don’t come out to the west coast often.

  • Jeff
    Posted at 20:52h, 03 November Reply

    Jon, I like what Michael Hyatt says, “give away the what and monetize the how”. As a consultant that works with chiropractic physicians I like this approach since many of them may or may not know what to do, but most of them need help implementing needed policies, procedures and changes (the how).

  • Josh
    Posted at 08:43h, 04 November Reply

    Jon,
    I do not doubt the validity of your argument here. There are a lot of things that I will try for free with little commitment, but I think that there is something else at play here. When you advertised your meet-up in the Twin Cities I was excited and signed up for it. Before I said yes there was no information about time/location but I was happy to sign up without any of that info.
    Given some constraints on our family (single car since I commute by bike/bus) I thought that there was a good chance that I could make it there. When I found out (after I signed up) that the event was at a suburban church and I couldn’t make it there was also not a way opt out. I think that when we give away things for free it is also important to help receivers “count the cost” before signing up even if it is not a monetary cost. Not sure if my experience was typical or not but thought it might be some helpful feedback to you.

    Thanks.

  • Caleb
    Posted at 12:08h, 04 November Reply

    So true. The same can be said for consumer goods. Even in a competitive commodities type market. There is always somebody willing to pay a higher price, especially when that item truly has value. Don’t be afraid to price your products or services high. I would venture to say the single best purchase I ever made was $2,500 worth of career coaching. At the time I thought that price was extremely high. But looking back I would easily have paid double. Some is true for some recent consulting services I used. Don’t underestimate your value!

  • KC
    Posted at 09:26h, 12 November Reply

    Boom. Dead on. I’m probably biased, but I think everyone who showed up at the Seattle meetup would’ve forked over $10 to be there.

    Remember not to lie for other people. Some smart guy once told me that. 🙂

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