Thursday, June 12, 2008

How much does free cost ?

I have just been reading a great book, called Predictably Irrational by Dan Ariely.

A chapter titled The Cost of Zero Cost, seems to imply that if anything is offered free, then people will flock to get it.

This is what I felt too when we setup HELP 10 years ago. HELP, the Health Education Library for People is India's first Consumer Health Education Resource Center. We kept entry to HELP free with the hope that more people would make use of our services because there were being provided at no cost.

However, even though we provide unique services which are useful and which are not available anywhere else in the city ( which has a population of over 15 million people) we only get about 50 visitors per day, even though we are located in the heart of the city.

An alternative point of view is that people do not use our services because they are free. The belief is that people do not value anything which is given away free because they perceive that it has no value.

Who is right ? What should we do ? Should we charge a nominal amount for our services ( so that people will realise the value we provide) ? Or should we continue to give them away free ?

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