Archive for the ‘Free – Power of Free’ Category

Amazon, ObamaCare … and the “power of free”

February 28, 2017

Since “repeal & replace” is in play, it’s time to update a prior ObamaCare posts …

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Everybody knows that Amazon’s free shipping program has been a resounding success.

The free shipping program’s success was highly predictable based an an apparently inadvertent “matched market test” that Amazon did.

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Early-on, Amazon launched  free shipping on $25 orders in the U.S. and sales skyrocketed.

In the UK, Amazon launched “nominal shipping” (think, 99 cents) for orders totaling the equivalent of $25.

Sales increased … but only by a fraction of the U.S. sales gain.

Proof-positive of the “power of free” … and evidence an equally important dynamic: there’s a big difference between “free” and “almost free” … when you slip a price on something – even a small one, people recoil.

Now, what’s the link to ObamaCare?

(more…)

Amazon and the “power of free” …

November 13, 2015

Yesterday in class, I mentioned some work by Chris Anderson of Wired on the “Power of Free”

Free: How Today’s Smartest Businesses Profit by Giving Something for Nothing

Here’s a real life example of the power of free.

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Everybody knows that Amazon’s free shipping program has been a resounding success.

So much so. that the company has announced that it will be moving the minimum qualifying order up from $25 to $35 … inducing shoppers to fill  their carts fuller or switch to the highly profitable Amazon Prime program.

The free shipping program’s success was highly predictable based an an apparently inadvertent “matched market test” that Amazon did.

image

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Here’s the skinny on the Amazon’s inadvertent market test …

(more…)

Amazon and the “power of free” …

July 1, 2015

Everybody knows that Amazon’s free shipping program has been a resounding success.

So much so. that the company has announced that it will be moving the minimum qualifying order up from $25 to $35 … inducing shoppers to fill  their carts fuller or switch to the highly profitable Amazon Prime program.

The free shipping program’s success was highly predictable based an an apparently inadvertent “matched market test” that Amazon did.

image

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Here’s the skinny on the Amazon’s inadvertent market test …

(more…)

Amazon and the “power of free” …

November 19, 2014

Everybody knows that Amazon’s free shipping program has been a resounding success.

So much so. that the company has announced that it will be moving the minimum qualifying order up from $25 to $35 … inducing shoppers to fill  their carts fuller or switch to the highly profitable Amazon Prime program.

The free shipping program’s success was highly predictable based an an apparently inadvertent “matched market test” that Amazon did.

image

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Here’s the skinny on the Amazon’s inadvertent market test …

(more…)

Cheap Tricks … err, make that cheaper tricks.

August 19, 2014

Warning: Adult Content.

The Economist – a reputable publication — recently reported the results of a groundbreaking economic analysis.

Specifically, staffers “analysed 190,000 profiles of sex workers on an international review site … with data going back to 1999 … with prices corrected for inflation.”

What did they find?

“The most striking trend our analysis reveals is a drop in the average hourly rate of a prostitute in recent years”

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What explains the 30% drop in prices?

Well, pardon the pun, it’s pure economics …

(more…)

Amazon, ObamaCare … and the “power of free”

October 28, 2013

Everybody knows that Amazon’s free shipping program has been a resounding success.

So much so. that the company has announced that it will be moving the minimum qualifying order up from $25 to $35 … inducing shoppers to fill  their carts fuller or switch to the highly profitable Amazon Prime program.

The free shipping program’s success was highly predictable based an an apparently inadvertent “matched market test” that Amazon did.

 

image

 

Early-on, Amazon launched  free shipping on $25 orders in the U.S. and sales skyrocketed.

In the UK, Amazon launched “nominal shipping” (think, 99 cents) for orders totaling the equivalent of $25.

Sales increased … but only by a fraction of the U.S. sales gain.

Proof-positive of the “power of free” … and evidence an equally important dynamic: there’s a big difference between “free” and “almost free” … when you slip a price on something – even a small one, people recoil.

Now, what’s the link to ObamaCare?

(more…)