A tour of free, Safeway version

Sent to get a gallon of milk at Safeway, I decided to take a picture of every example of "free" that I encountered as I walked through the aisles and into the parking lot. There were lots of repetitions of things like "buy one, get one free", but here's one example of each kind I saw. This being a supermarket, the canonical "atoms economy" example, almost all fall under the Free 1 category.

(Note: the Ultra II Free detergent is actually a different use of free: it's "perfume free")

 

Comments

[Elia Freedman]

True, there are a lot of 'free' things in a supermarket. But I had an 11th grade economics professor many moons ago who would argue none of these are examples of free. You pay for every one of them in some way, whether using gasoline to drive to the store, or in the case of buy one get one free, you are really paying half price for two.

Elia

[Chris Anderson]

Elia,

Follow the link the post. You'll see that we have a pretty clear taxonomy of different kinds of free, and this one is, as you say, in the "fake free" category.

[Alberto Cottica]

Disclaimer: I am an admirer of your work. With all due respect, are you sure cross subsidies deserve all of this attention from you? It's not exactly rocket science, you study them in first year economics, then some people get a job at Walmart trying to decide the exact cross-subsidy structure to get the consumer behaviour pattern that they want. Part of this is deciding some stuff goes free. It is an important part of the business model of some major companies, and I am sure that the work can be engaging if you like that kind of thing. But... I have been reading this blog for a year now, and people keep coming back with comments on how free is not really free but some form of cross-subsidy, because that's all there is to say. You are a cutting edge thinker, shouldn't you be working on cutting edge stuff?

[Jay]

I think the "Free Parking" sign is not advertising anything free at all. In the two places I've lived (Denver, Houston) parking at grocery stores is understood to be free, and there are no signs. I think this sign is advertising that folks who park and do not shop at Safeway will be towed. I saw paid grocery parking for the first time this year in DC and I wondered how stores could get away with charging people just to show up. Seems backwards.

[Chris Anderson]

@Alberto. This is a blog. I post random stuff that I come across each day. Don't worry--the book is not about this kind of FREE--it's about the economics of near-zero marginal costs. That's 21st Century FREE, which is radically different from the 20th Century free we see in supermarkets. The reasons I post about 20th Century free is that it's an interesting historical context for how people psychologically respond to free. If you read the Wired article, you'll have a better sense of the direction the book is going.

Please do not try to read these posts as serial installments of the book. They're not.

[Carl Morris]

Is it true that offering "Buy One Get One Free" used to be illegal in Germany?

[michel]

At first I did not believe, but after seeing the pictures I too agree with you. There are a lot of 'free' things in the safe way supermarket. This is a nice post.
____________________________________
Michel

[mikerambling]

hi, it is true though , sometimes we just dont know the edge of is it free or "real" free. There would always doubt to accept anything that is label as free because usually it isnt.

[evelyn]

I think it is a marketing strategy. Consumers like to buy and get something for free.

[Mauricio Bussab]

Lesson of the day: if you need someone to run to the supermarket and get a gallon of milk real quick, don't ask a scientist :-)

[Francis Hamit]

Dear Chris:

This is Retailing 101, like the "lure" at the carnival booth. Two for one doesn't cost them anything but their profit on that one item. They are selling at cost. At the same time, while you are there, you buy other stuff you need. At full price. The cost of getting there will inspire most people to buy everything that they need or want there rather than look elsewhere for the best price. (Zipf's Principle of Least Effort). While this kind of marketing works well for physical goods, it does not for electronic products. In fact a low price may harn the "brand" and devalue the product in the consumers' eyes. I think this is why the Amazon Shorts program failed. 49 cents wasn't enough value. They offered some for free, but that didn't seem to help, because each title is unique.
The big problem was the lack of immediate access to the material, which has to be downloaded and, if any length, printed out to be read. A story in a magazine can be read at the consumer's discretion, without such measures. "Free" as a lure works for
things which are needed. When the purchase is discretionary, not so much.

[Francis Hamit]

Dear Chris:

This is Retailing 101, like the "lure" at the carnival booth. Two for one doesn't cost them anything but their profit on that one item. They are selling at cost. At the same time, while you are there, you buy other stuff you need. At full price. The cost of getting there will inspire most people to buy everything that they need or want there rather than look elsewhere for the best price. (Zipf's Principle of Least Effort). While this kind of marketing works well for physical goods, it does not for electronic products. In fact a low price may harn the "brand" and devalue the product in the consumers' eyes. I think this is why the Amazon Shorts program failed. 49 cents wasn't enough value. They offered some for free, but that didn't seem to help, because each title is unique.
The big problem was the lack of immediate access to the material, which has to be downloaded and, if any length, printed out to be read. A story in a magazine can be read at the consumer's discretion, without such measures. "Free" as a lure works for
things which are needed. When the purchase is discretionary, not so much.