The Curve comes to Cannes
Amidst the scramble for shortlists and faint rumble of roaring Lions, gaming expert and renowned author Nicholas Lovell joined international delegates to talk ‘freeloaders, ‘superfans’ and how brands can benefit from both…
His premise is simple: vary your offering and pricing structure, factoring in both free and premium content, to build stronger relationships with consumers. This tiered approach to marketing, Lovell argues, is how the likes of Candy Crush, Apple and countless small startups, maintain a steady flow of loyal customers, or ‘fans’, and turn profit despite giving away large amounts of content. The process of embracing ‘freeloaders’ – people that simply want to download a no-fee app, or find free online advice – and converting a percentage of them into paying customers, or even ‘superfans’, who invest vast amounts in your products, is what creates The Curve. So how do brands make this approach work for them? Lovell provided the answers.
Why should we give away free content?
For every commodity that comes in digital form, the internet has enabled free sharing. Now, a brand’s main threat isn’t actually piracy, it’s competitors figuring out how to give something away that you have historically always charged for. Therefore it’s more important than ever to find your audience, and encourage freeloaders to love your brand by exposing them to high quality content, which in turn provides the context that enables your superfans to justify spending lots of money with you.
How can we turn freeloaders into paying customers?
Some will always remain freeloaders, and that’s good, because like I say, they help superfans on their way to spending large amounts. But, if you distribute good tailored content, which has the capacity to behave differently depending on individual consumer reactions, you become able to speak to potential customers directly. This nurtures a relationship between brand and consumer, resulting in some of your initial freeloader fans sliding up the curve.
Give us an example of when this has actually worked…
Tim Schafer. He’s an old-school game developer – his work was thoughtful, funny and didn’t involve shooting people in the head. Round about 1999, publishers decided to start making lots of cheap gunman games instead. So, Schafer used Kickstarter to reach his audience directly.
He said to his fans, ‘if you give me $400,000 I’ll make a game like I used to: for $15, I’ll give you a digital copy of the game; for $30 you’ll get a documentary too; for $100 I’ll throw in a book and t-shirt; for $500 you can have an image of yourself painted in the style of the game; for $1000 you’ll get an original piece of artwork; and for $10,000 you can have lunch with me in San Francisco’… He hit his $400,000 target on day one, and went on to raise 3.8million.
Interestingly the $100 tier accounted for just 15% of the consumers but provided more than a third of the money. There’s a bunch of people that will always just want a $30 dollar game. But there are other people that want more, and are prepared to pay for it.
Does The Curve work for B2B marketing?
Yes-ish. If you accept my argument that most people buy for emotional rather than logical reasons, you will see that’s also true in B2B to an extent. At the paid end of the curve, a company will sometimes do things to look cool, so you can sell your offering to a potential business partner, to whom being cool is an important part of their public profile or personal psyche. At the other end of the curve, your starting point is to be useful to as many people within that organisation as possible. In this sense you’re using free offerings, to eliminate the possibility of a ‘no’ reaction to your services.
For more information on Nicholas Lovell, visit his website