When is it ok to work for free?

Madden was a merchant. He sold fruits and vegetables at the market, and even if the competition was strong, he could make a good living out of it.

He decided to expand to the closest town to his village and try his luck there. It was quite a risk, as nobody knew him there – and the competition was even stronger – but the promise of the bigger, better-paying audience attracted him there.

He needed someone to help him to stand behind the stand while he is managing the rest of the business, so he hired two candidates for a probation period of a month.

’I need only one seller.’ – he told Eve and Veronic. ’Whoever sells more the next month gets the job.’

Graphics created by @Brill.Brain

Eve and Veronic both stood behind the stall, and when Madden came back, to his surprise he saw people queueing to buy from Veronic, while nobody stood in front of Eve.

’Veronic will be the one.’ – he thought, but only until he got to the stall and found out that Veronic was giving away a free apple to every person!

’What are you doing, are you crazy? Will you ruin my whole business by giving away everything for free??’ – he shouted at the poor girl.

Eve sold 5 apples, so things were in her favour, but Veronic told Madden:

’You gave us a month, wait and see what I can do in 30 days, not on the first one.’

She made Madden curious, so he agreed.

The next day people were coming back to Veronic to ask for the special deal she promised when she gave them the free apple.

’It was really tasty. My son loved it. You said we get a pack of six apples for a special price, do you still have that?’

The next couple of days people kept coming back and took the pack of six apples, which was at a special price.

’Not huge money, but at least, it’s profitable.’ – murmured Madden.

But his greedy face lit up when these people came back to take the big fruit and vegetable box and paid more than they would have paid for the competitor because Veronic prepared the box for them with their favourite pieces.

’Madden, can you deliver vegetables?’ – asked Veronic, - ’There are people who want to pay a monthly fee for their vegetable box to be delivered, and they are ready to pay a good price, regularly.'

Graphics created by @Brill.Brain

By the end of the month, Eve sold 5 apples each day, while Veronic had a growing customer base, coming back to her for more and more produce, she built a subscription business and sold more than Madden has ever before. All this with giving away free apples.

’Did I ruin your business or not?’ – smiled Veronic when she signed her permanent contract.

Graphic design specifically created for this marketing anecdote by the fab @brill.brain

Moral of the story:

Let’s make it clear: working for free is not a wise thing, it can’t be considered as a business then (and I’m not talking here about cases when you choose to do that for a good reason, charity, barter, or helping a friend.)

But when you have a process (a funnel/customer journey), where the first element is free, and you have a plan on how to make people pay for the upcoming elements, it’s absolutely ok.

Offering someone your core product right away, which is presumably – and hopefully – priced what it’s worth, won’t work unless they know you.

You have to take people on a journey from not knowing you, nor their problem you want to solve to being aware of their problem and loving you so much so that they want to buy from you.

You have a journey (or a funnel) even without planning one. If they have to call you and book a consultation, where you offer them your service, that’s a simple funnel. Only you can tell how effective it is, and if it could be more effective (I’d bet it could.)

When you plan the funnel you always start with offering something requiring a very low commitment from the people – not even for money, but their time and attention.

You plan what the next steps will be and look at the return of the whole funnel.

So if you do a free one-hour strategy session for someone with a free evaluation of their current situation and a step by step plan on what to do next, and you simply hope they come back to you for more, it was insanely free. And you shouldn’t do that.

But if you offer them a one-day workshop right at the session and you have a plan on what to offer after the workshop – and how to go after those who didn’t take the next step – you have a great funnel, and you are very wise to sacrifice the profit of the first stage for much more profit from the whole funnel.