Let’s talk about “free.” Not as in “liberty,” not as in “without” (e.g. “sugar-free”), but as in “free stuff!”
I’m a Starbucks Gold member. One of the advantages of being a Gold member is that you get “freebies.” Every time you spend a dollar at Starbucks, you get two points. When you accumulate 125 points, you get any food or drink item for free. I usually use them for a venti Frappuccino, which can run into some major money, like almost $7.
Did I say it was “free”? Because, when you think about it, it’s not. 125 points, at 2 points for each dollar spent, means you spend $62.50 to get the number of points. So, they get $62.50 minus the $7 that the Frappuccino costs. That means they net $55.50. Okay, sometimes they run incentives where you get points. One incentive was they’d give me 200 points for refilling my card using Chase Pay. They have special “double star” days where you get 4 points for every dollar spent.
Likewise with the airlines. They had reward programs where you accumulated miles every time you flew somewhere, and at different numbers of miles you got a free upgrade, money off on a coach seat, all the way up to some magnificent free trip around the world. Except you had to buy tickets on other flights to get the free miles. That wasn’t a problem for me; I was gone all the time, and my company let us keep the miles we accumulated when traveling on business. But still, you got the rewards for paying for tickets. Ditto the hotel and car rental rewards, as well as the American Express points. You could get free stuff for a certain number of points, but it wasn’t exactly “free.”
Back in the days of the Wild and Wooly West, saloons would offer a “free lunch.” The idea was to get you in the bar and spent a few bucks for a beer or “three fingers o’ red eye!” (as my Dad used to say). Of course, if you partook of the free lunch, they fully expected you to spend a few bucks at the bar. If you didn’t, they usually made it clear that you were no longer welcome there, unless you planned on spending money there. Nobel Prize-winning economist Milton Friedman coined a term, TANSTAAFL (pronounced “tan-staffel”), which was an acronym for “there ain’t no such thing as a free lunch.”
“Free,” in almost every instance, means “included in the cost.” We lavished gifts on clients attending training classes, because those clients were spending $1500 a day to come to class. The freebies didn’t cost much, but they bought us goodwill. One of the more popular freebies was tape flags, little pieces of tape with a colored tab at the end. If you found an important thing in your training manual, you flagged the page by sticking one on the page with the flag sticking out, so you could find it later. Clients loved those, and so did we trainers.
Well, someone got the idea that we could save a couple of hundred dollars a week by not giving them tape flags. Needless to say, the clients were pissed about this. I mean, a package of them (about 50 in a dispenser) was about $1.50, less if you bought in the quantities we did. I finally decided to buy a bunch and turn the cost in on an expense report.
Naturally, when the boss got the report, she’s on the phone with me. “What’s this $30 for?”
“Why’d you buy all these tape flags?”
“Because you won’t, and clients are upset that they aren’t getting them.”
“Well, we decided not to buy them.”
“I know. And I think it’s stupid. If it were up to me, I’d find a way to print the company logo on each flag.”
I didn’t get my $30 back, but the tape flags were back the next week. They didn’t print the company logo on each, but that wasn’t the point. The point was, you buy a lot of goodwill with stuff that’s free.