Page 198 - 100 Great Marketing Ideas (100 Great Ideas)

95 SET A SPRAT TO CATCH
A MACKEREL

Loss leaders are a well-known ploy in retailing. Essentially, the
store sells some popular item at a much-reduced price to attract
people into the store, on the assumption that they are almost certain
to buy something else as well. The profit comes from the “something
elses.” Fast-food restaurants often do the same thing, offering (say)
two pizzas for the price of one on the assumption that customers
will buy a bottle of wine, a dessert, a salad, or whatever.

Translating this into other business contexts may be another story,
of course.

The idea

When voice-over-internet protocol (VOIP) was first developed it was
difficult to see how to make money out of it. The free communications
and information sharing capability of the internet was, until then,
paid for from advertising, but it was hard to see how this could
apply to voice communications. After all, no one would want their
telephone conversations to be interrupted by advertising.

When Skype first started trading, the company decided to give
away the Skype-to-Skype part of the business, so that members (not
subscribers) could talk to each other indefinitely for nothing. This
meant that people could call anywhere in the world to another Skype
user, for as long as they wanted, without paying anything at all.

This was, of course, a very real advantage to a great many people.
Skype conference calls could be arranged globally, at zero cost, and
the system very quickly acquired over 12 million members. However,

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