If you can’t make it work, make it free

There’s been a great deal of discussion lately about the whole concept of ‘free’. First, Malcolm Gladwell slammed Chris Anderson’s new book called Free. Then Seth Godin disagreed with Gladwell. It’s all quite interesting and definitely has generated some discussion with regards to the future of newspapers and magazines. I certainly don’t have a solution for the print industry’s woes (whoever does come up with that will likely be a smarter man than I). But, the point of this post is to illustrate how free can salvage a potentially damaging event.

This past weekend, I attended Virgin Mobile’s Virgin Fest in Halifax. You may have heard about the fact that the headlining act, The Tragically Hip had to bow out due to a medical emergency. As such, I’m sure lots of people were quite disappointed (me among them), and would have been looking for a refund. What happened next should be a case study for business students everywhere. Virgin gave everyone their money back in full and opened the doors to anyone who wanted to attend for free.

To me this is extraordinary brilliance on their part. For one thing, it ensured that the Garrison Grounds would be packed to the gills despite the rainy weather we’ve been having. For another, it ensured that there would be no disappointed fans. Let’s look at their other options:

  • Refund money only to those who requested it
  • Refund a portion of the ticket price to offset the value of seeing the Hip
  • Offer no refunds at all, which is within their rights to do
  • Cancel the whole event

The first option is OK, but it would have left a sour taste with many people who would have felt ripped off for not seeing the main act. The second option would have offset this and likely have made most people pretty happy. The third option is how many smaller businesses might have chosen to go, to try to hold on to as much profit as possible. The last option likely wasn’t an option at all, but if there was enough dissent, they may have chosen to go that way.

The thing about Virgin is that they recognized that the event would still be seen as a success even without the Hip and they knew that refunding everyone’s money would make nearly everyone happy. What’s more, it does a great deal for their brand equity in a place where Virgin Mobile isn’t likely even on the minds of many mobile phone consumers, with BellAliant, Rogers and Telus holding the dominant positions in this market. Now, when someone goes to buy a new cell phone, Virgin may be more likely to be on their map. It also makes people talk about the brand just as I’m doing here. And people are talking about it in a positive way.

Next time something goes wrong with a client, consider all your options, but don’t rule out using free as a way to salvage a relationship. I’ve never been a big advocate of free work, but sometimes a positive relationship with a brand is worth more than a few dollars in your pocket if it keeps everyone happy.

What do you think? What other strategies or techniques have you used to keep a client happy?

Previously posted on brightwhite.ca

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