AOL and I will never, ever be BFF. They even told me so.
Here's my story, going way back to 2000. This was a time when every American's mailbox was absolutely stuffed to the gills with AOL discs.
One fine mid-Atlantic day I wanted some internet access on my computer. I knew NetZero still had some free numbers around, but the only place I knew to find them was on … the internet. Which I couldn't access since I had just moved to a completely new mid-Atlantic area and didn't have a local NetZero number. (Remember dialup?)
(Fun fact: NetZero is still up and running in 2019!)
Abusing AOL's free trial
But, thankfully, I still had seven AOL free trial CDs. Once the light bulb went on it was only a matter of about 23 seconds before I could lay my hands on one.
So I started my free trial, got on the internet, and found my local NetZero number. Once I verified that I could access the internet through this number, I got on the horn to AOL to cancel my free trial.
Now, I do suppose it was a bit tacky to (a) call AOL up to cancel only twenty minutes after signing up, and (b) telling them bluntly that I used their free trial to download the software for a free access plan.
AOL wasn't having any of that
The guy at AOL wasn't just short with me.
He was ticked.
He didn't even try to keep me as an AOL customer. He just ripped up one side of me and down the other, told me in no uncertain terms that I'd never get a free trial with AOL again, threw the cancellation confirmation at me, and ended the call.
Nonetheless, his assessment of my intentions was right on the money. He was spot on in cutting me off and doing it quickly because free riders kill profits. I pegged myself as an obvious free rider, and they treated me accordingly.
They dangled a carrot in front of my face, and I grabbed it before getting whacked with the stick, but they made sure that I never got another chance at a carrot.
Dealing with free riders
AOL was wise in its dealings with me. I doubt I was the only one that pulled this move on them.
A subset of consumers are masters at finding the ways to extract maximum value for minimum, or no, cost. It's because of this group of customers that companies change their policies.
But while the rules are in place, why not exploit inefficiencies? I maintain that free riding is completely ethical. If someone plays by a company's rules and gets goods or services for below cost or even free, then it's no one's fault but the company's for tolerating it.
Consider these other examples of free riding:
Convenience use of rewards credit cards
I love my rewards credit card. I get free use of the issuer's money for a few weeks, the convenience of not carrying a wad of cash around, fraud protection, and a rebate! They're paying me to use their card, as long as I use it only for convenience and I pay my bill in full each month!
Granted, they get a cut of the transactions every time I use the card, but the merchant pays that fee, not me
How it can be stopped: GroCredit card issuers can charge a fee or change the nature of the card as the cards expire. This can make the cards less appealing to convenience users.
Extreme couponing
There are couponers, and there are extreme couponers.
Getting item after item free or nearly-free is a challenge that a fair number of people take on.
In most cases, stores get paid the face value of the coupon plus a handling fee by the manufacturers. But if the store doubles or triples coupons, the extra cost above face value is on them.
How it can be stopped: Grocery stores can make themselves less of a target for extreme couponers by not having double / triple couponing. That takes a lot of fun out of it
Free trials of anything
If a free trial of whatever is offered, why not use it?
That's what I did with AOL at the beginning of this post.
Some people take it a step further and milk the free trial for a long time. They might call up to cancel, and the representative is authorized to offer another free month just to keep you on. And when next month rolls around, they're calling again.
How it can be stopped: Free trials are used to garner business, so they can simply stop.
Unlimited anything
There's always a subset of customers that will push unlimited bandwidth, unlimited storage, all-you-can-eat, or unlimited movies per month (I'm talking to you, MoviePass!) to the absolute limit.
Those customers will either be the downfall of the company or will cause the company to alter the deal.
How it can be stopped: As an example, Amazon used to have an unlimited storage plan. After enough people uploaded 100 terabytes or more to their unlimited accounts, Amazon stopped offering the plan. In a different example, MoviePass nearly failed and stopped offering it's $9.95/month all-you-can-watch membership.
Be a free rider while you can
Free riding may end up being short-lived, but why not use it for fun and profit? If you don't, someone else will, and the stupid-great deal will go away anyway.
2000? I vaguely remember it, so it must have been around 1995.
At CVS they constantly have deals where you can buy something for $4 and get ExtraCare bucks that can be used on anything. Most people see that and think ok, but what if I lose it, forget about it, etc.
Smart people look at it and say, I’m in CVS because I need milk, shampoo, etc., why don’t I just split this up into 2 transaction? Buy the “free” item, get the receipt, and then buy the milk with that money. Sound like free toothpaste to me.
Hilarious that he got mad at you. Was there a time when customer service representatives cared about the company?? Sounds strange.
But using a rewards credit card is *not* freeriding. It may seem that way to the consumer, but you are actually making the credit issuer a tidy profit every time you charge something to the card – it’s just the store that pays, not you. I demand brilliant customer service from my credit card companies, even though I pay in full every month and love getting my rebate checks in the mail.
At CVS however, where I routinely scoop up freebies with coupons and their store money ECBs, I take what comes. They’re not making any money off of me.
Unfortunately, I have experienced far better customer service at the CVS than I have with the credit cards, though everyone eventually pays what they owe me.
Your take is an interesting one. But not one that the advertising industry nor research shares. The truth is, folks sign up for free trials because they have some sort of interest in the product. [Which is why I sign up for free trial subscriptions to “Oprah” and “Women’s Day” but NOT for “Popular Mechanics.” If the advertiser has not oversold the value of the product, and if the advertiser has reached their target audience, some small fraction of those freeriders will stay on board even when there’s a charge. That fraction doesn’t have to be large for the advertising campaign to be a success. Ask anyone in Direct Advertising.
Personally, I wait to be “sold” on the product which is the product’s job, after all. Sometimes it works, which is why I’m still subscribed to “Oprah.” Sometimes it doesn’t.