This archive report was first published on 12 May 2020.
As the COVID-19 pandemic continues to affect economies worldwide, many businesses have resorted to giving out their premium products for free to their customers and prospects. However, this trend has raised eyebrows among business experts, who argue that it is not viable economically.
According to Michael Hyatt, an expert in marketing, giving out products for free does not benefit the economy. He explains that the economy thrives when producers create value and consumers recognize that value and willingly pay for it.
Hyatt also argues that free things do not benefit the receiver. He notes that people value things that cost them, and that free products may end up in the hands of people who do not deserve, appreciate, or reciprocate later.
Furthermore, Hyatt points out that giving out free products does not help businesses in any way. He notes that businesses need money to pay their bills, employees, and develop their business, and that giving away products for free is an act that neither benefits the economy nor the recipient.
Instead of giving out free products, Hyatt suggests that businesses think of ways to increase value to their customers so that they can solve their problems better. He also emphasizes the importance of creating solutions that many people are willing to pay for, in order to create a value chain that benefits everyone.
As an example, Hyatt cites schools that need to come up with innovative ways of teaching pupils while at home, which parents are willing to pay for. This, he argues, will ensure that teachers get paid for their services, and that the chain of payments continues.
Hyatt also notes that companies like Google may seem to give their products for free, but this is not true. Someone has to pay for the free browsing, and that someone is the advertiser.
Mr. Kiunga is a business trainer and the author of The Art of Entrepreneurship: Strategies to Succeed in a Competitive Market.
