on 14 November 2013
The Curve by Nicholas Lovell is a book that will help you to think about your business differently and particularly about how to think about your customers and how to make money from them.
For example, at one point he discusses the difference between "free" and "cheap" by quoting a famous experiment where psychologist Dan Ariely set up a table to offer customers two kinds of chocolate, a high quality Lindt truffle or an "ordinary" Hershey Kiss.
"A large sign above the table read, `One chocolate per customer'. Customers could only see the chocolates and their prices once they stepped up to the table.
"Ariely started the experiment by setting the price of Lindt at 15 cents [the cost price was 30 cents] and Kisses at 1 cent. [The customers] acted with a great deal of rationality: they compared the price and quality of the Kiss with the price and quality of the truffle, and about 73% of them chose the truffle.
"The purpose of the experiment was to see what impact free had on people's rationality, so Ariely then lowered the price of both chocolates by 1 cent. `What a big difference free made. The humble Kiss became a big favourite. Some 69% of our customers (up from 27 per cent before) chose the free Kiss, giving up the opportunity to get the truffle for a very good price.'
"Ariely repeated the experiment in different circumstances and with different conditions. His conclusion is that free is a very powerful motivational price. It gives us an emotional charge that increases the perceived value of what we are getting. More than that, we will often take the free option because it is perceived as being lower risk, as eliminating the possibility of loss."
Coming from the digital world where freeloaders, people who use services but don't pay for them are important, Lovell understands how businesses need to give value away in order to win customers. The most important thing today is to win the attention of consumers, and then to work out how to make a profit from them.
Freeloaders provide the context in which your shop can be valued by customers. For example, when Waitrose gives away free meal suggestions to shoppers, it solves a problem for busy people about what to eat and frames their thoughts about what to buy. Relevant information is often the best thing to give away for free.
How you make money out of it requires you to think about what the potential is to attract customers who will be prepared to pay a lot for what you provide. The superfans underpin the success of many digital businesses. They are the equivalent of the £50 basket shoppers that you want to encourage.
The Curve is about understanding how you make profits from the superfans. For example, the company behind Pocket Frogs gave away the app to millions. The game had three price points: 99 cents, $4.99 and $29.99. The 8% of people who chose the latter accounted for 49% of its revenue, worth around $1.5million. That is 8% of the small fraction of people who actually paid anything.
Lovell's book will challenge how you think about business, will help you look at the world differently and will give you an edge in winning tomorrow's consumer over to your shop.
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on 15 November 2013
The concept of the Curve starts as a seemingly niche idea, focused on a few specific industries. By the end of the book it feels both common sense and revolutionary in the potential breadth of its applicability. It has provided a new lens through which to evaluate and understand corporate strategy. A 'must read' for anyone needing to understand the future of business. In addition it is packed with fascinating anecdotes and observations, which makes it a compelling and enjoyable read.
on 4 October 2013
How can giving away things for free make you rich? That does not appear to make any rational sense and yet Nicholas Lovell, in his new book `The Curve', shows us that more and more people are doing just that. For most of us giving away products or services for free is a scary prospect but The Curve seeks to dispel this fear by understanding that the challenges and opportunities presented by the Internet, as well as by new technologies such as 3D printing, can actually be addressed by something as old as the hills: the power of relationship.
The Curve is a great read. The evidence for the market change is hard to dispute, the examples Nicholas uses are compelling and the advice for embracing the change is easy to understand. There are applications for everyone on how they can utilise the ideas in The Curve from the artist to the lawyer, the manufacturing company to the charity.
I am already thinking of improvements I need to make in my business to embrace concepts in The Curve. I would encourage you to read the book and do the same!
on 11 October 2013
This is not only a great read, but following on from titles such as "The Long Tail" is opening our eyes to the imminent future of consumer orientated business.
Covering a multitude of examples from businesses across Gaming, Music, Baking Goods and Swimming Pools, Nicholas shows how the embracing of the Free price point is enabling people throw of the tyranny of the physical and significantly increase their earnings and value of their business.
I would recommend this as a key book for anyone who is involved in a business which sells direct to consumers.
on 19 December 2013
I have read The Curve twice and will read it again. And again. It is absolutely on the money especially for those creatives in digital. I happen to agree with pretty much all of what it says, but would urge my fellow readers to read it, embrace it, act on it. Sooner rather than later. You only get one life.
on 28 November 2013
As someone who works in publishing and who talks regularly with authors, designers and creatives, the challenges of free material online are a constant conversation and debate. This book addresses those challenges head on. It shows us that free does not have to be feared but that it can be embraced as a way to build a dedicated customer base who will pay for products and services.
For anyone new to online business, this is a definitive work on how to approach your business strategy. For people more experienced it draws together threads and ideas that you will understand into a single and compelling approach.
Nicholas presents the principles in a way that's very easy to read and uses a number of anecdotes and case studies that make it easy to digest and understand. Thoroughly recommended.
on 27 June 2014
Highly recommended read from a smart, informed tech, gaming geek, who backs it up with great, enjoyable writing too.
A fascinating analysis of how the internet has changed sales and pricing, where giving things away for free allows you to build even more valuable super fans and ultimately achieve higher revenues per product. Enjoy understanding about the the power of The Curve and what is might mean for your business or sector. You'll newly appreciate the sophistication of the pricing models run by crowdfuncing sites like KickStarter and GoFundMe and many other thought leaders.
I read this in a couple of days and felt it added lots of value to my work as a digital strategist and venture investing. Thank you for the experience Nicholas! I've recommended your book to lots of my young, tech and entrepreneurial friends in London.
on 3 June 2014
Being in the professional open source business, I know how hard it is to get paid for things that are perceived as "free".
This book provides very good insights in the dynamics of things that worked for other businesses and artists, or anybody else with digital (and other) goods.
Basically, in exchange for free give-aways, you get free marketing. All that is left is finding the people who will pay. This book shows how.