Living in Silicon Valley I had assumed free Internet access was standard operating procedure for every coffee shop in America.
Apparently not.
On a recent trip to the East Coast I stopped by a Starbucks only to find out they charge for Internet access. I was shocked. I walked out. Is this normal for Starbucks? It is very unlikely I will visit another Starbucks. That's how important free wireless is to me. It's principle.
And I know I'm not the only person who feels this way. So if you multiply my lost business to Starbucks on that particular day (probably around $7 - $10) times the thousands of consumers who feel the same way I do about free wireless that equates to big business - lost.
In the 24/7, work-from-anywhere, got-to-be-connected world we live in I am amazed at how many businesses simply don't get the importance of free wireless. Offering (free) wireless is a business draw - not an operating cost and not another product line. Smart marketer's use free wireless to improve the brand, attract new customers and build loyalty.
Examples?
- Jet Blue: They offer free wireless at most of their USA terminals. Don't think this is a big deal? With the commoditization of airlines you better believe this is a big deal as it helps to differentiate the brand.
- Your Independently owned Neighborhood Coffee House: Like the one I chose to visit after I walked out of Starbucks. No doubt a strong ROI for what is probably a $50 a month investment.
- Town of Westport, CT: On a recent trip to this lovely Connecticut town I was pleasantly surprised to find free wireless offered at many town parks and the local swimming pool. Ok, it's not a business but it's a great way to improve the "brand" of local Government - and the appeal of the town.
But this post isn't just about coffee and free wireless.
As a marketer you need to be very careful about what you decide to charge "extra" for versus what you "include". One is a new product line/revenue stream while the other is an investment in the value of the brand. These can be very difficult decisions. Some questions to ponder:
- Who is the likely target market for this new product and how is it different than the target market for our other products?
- How much revenue / profit can be made on the new offering if we charge extra for it? This year, next year, five years.
- How much of this revenue / profit will come from existing customers?
- Will this revenue take away business from other product line(s) or tarnish our brand?
- How many "new" customers will this new offering bring us?
- Will these new customers purchase other products/services from us?
- Does the new product require a separate and/or increased marketing budget or can we promote it via existing campaigns?
- Will charging extra cannibalize revenue from our other product line(s)?
- If we include the new product/feature at no cost (to add value to our core brand) will it: (a) result in more revenue from existing customers?(b) attract new customers?(c) Improve the loyalty of our customers?(d) give us a competitive / strategic advantage?
- What is the competition doing and how will our competition respond? Can/will they match our decision, use it against us, etc.?
I can think of quite a few additional questions and I'm sure you can to. The point is to give serious thought to what you charge extra for and not let short-term greed cloud your judgment.
BTW, this same line of questioning applies to decisions about whether or not to require registration for your site's content. I can't tell you how many white papers, articles, etc. I have avoided downloading because they require complex registrations. Sure the content is "free" but a prospect's time equates to money so there is a perceived cost to the prospect.Labels: content registration, nickel and diming customers, pricing
