When Something is Free Online - Ad Revenue...
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Some companies provide a product or service free of charge and generate money from advertising. Perhaps they sell banner advertising on their website. A free product draws web traffic so that the number of visitors seeing the advertisement increases. The more visitors a site attracts, typically the more revenue generated from the ad space. Perhaps a software application is free of charge, but has embedded advertisements. When ads are clicked, the software developer earns a percentage of the revenue paid for serving the advertisement.
Goodwill Branding / Public Relations
On occasion, companies will provide a product, service or information free of charge. If the offering is extremely magnanimous or socially sensitive, they will often receive significant press exposure, generating free publicity for their brand. Pepsi Cola sponsors a number of athletic events and generates enormous amounts of brand loyalty and positive PR with their target audience.
Sometimes companies or individuals will provide something free in exchange for contact information. Ebooks are often provided free of charge if you provide an email address. The contact information may be sold at a later time or be used to market related products. It is important to check website privacy policies to determine how personal information can be used.
Companies will often provide a light version to gain attention for fee-based products or services. This often allows potential customers to see a product's or services potential. The hope is that providing something free will generate both brand loyalty and interest in fee-based options or services.
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