Blog 3 (Week 4)

 The rise of King Camp Gillette, the guru who invented disposable shavers among a variety of other products, is nothing short of intriguing.  Considering it was the 1800s, his instigation of the ‘free business model’ initiative - give away a free product to endorse another - proved to be the golden jewel in his crown.

 Many have since followed this economic model, and scored equally attractive jewels.

The free business model is firmly entrenched into our economy, most notably, the digital economy.

A regular scene when surfing the net these days is on-line businesses giving away free products.

Interestingly enough, yesterday, I came across this little marketing manoeuvre.

 After reading a news article on yahoo on-line news, which explained that tigerairways.com  was giving away free interstate flights and had already sold in excess of 50,000 seats, I decided to delve further.

What happened next?  A few phone calls back and forth to the hubby and we were booked on a holiday to sunny Queensland.

What a smart move by tigerairways.com.

But you see, it wasn’t really free for us.  We forked out $250 for airport charges, taxes and baggage.  However, it was still very cheap flying for four people.  

But it is not as though the flight company is losing money.  The airline just snagged our business, which it otherwise would not have had, and will now showcase the service it has, something we otherwise would not have seen.  We generally stick to the one airline company.

On closer inspection of the tigerairways.com site, advertising revenue for the company is streaming in from a variety of businesses wanting to flog their products, from car hire places to hotels and airport parking firms.

Other income tigerairways.com is generating is from other travellers who would have missed the free deals.  A percentage of these potential customers would go on to book low fare seats.

This truly is the ‘free business model’ at play.

This entry was posted on Friday, November 21st, 2008 at 9:29 am and is filed under ALJ 301 Blog posts. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.