What You Get for Giving It Away for Free

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Who doesn't love free stuff? Hardly anybody, which makes us all terrific suckers for it. Americans love our free speech, our free food at work, our free samples, and even our free credit reports. It's something for nothing (except for when it's not), and what's not to love about something, especially if you can turn it into something more?

Consumers often don't ask what the givers of free stuff get out of the bargain. It's not always privacy violations, of course; it's often actually pretty prosocial. Researchers in Texas, West Virginia, and Georgia have just released a study on the benefits of giving a product or service away, and it's powerful. Free samples are more likely to lead to organic word-of-mouth advertising, which anyone in marketing knows you can't really buy.

"Consumers of free products, but not paid products, will be motivated to 'return the favor' they have received from producers, and they will share their experience with others as a means of doing so," said coauthor Wen Wen in a press release. This is different than working for exposure — it's a planned business strategy, rather than a gambit for breaking into a market. It's also not a magic bullet, especially given how muddied the waters are for online reviews.

Still, there's plenty to be said for word of mouth. We trust our friends to give us good leads. If you're looking for ways to break out as a business, it might be worth seeding your customer base with some well-considered giveaways.