Running head: Week 7 Case Study
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Week 7 Case study: GIVING AND RECEIVING ON FREECYCLE.ORG
Consumer Behavior
DeVry University
Week 7 Case Study
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Week 7 Case Study: GIVING AND RECEIVING ON FREECYCLE.ORG
Case Study Discussion Questions
1. Why do you think Freecycle.org has achieved such high levels of growth in such a
short period of time?
Answer – From the case study we can see that Freecycle.org has achieved very large success
as can be seen from its millions of members in countries across the world, and the very large
amount of free publicity and positive word of mouth that it has got. The reason for its success
can be attributed to the fact that the Freecycle has been created with an objective of making
the world a better place and does not have any commercial objective behind it. It brings in
many positives such as giving people a chance to help others, connecting people in need,
enabling reuse of huge amount of used products that would have otherwise filled landfills
that would have polluted the planet and all of it in a manner that is very simplistic and easy to
use. Therefore factors such as the excellent concept it has been founded on, an easy and
simplistic user interface and positive user experience and viral and social marketing have all
contributed to the company to achieve the very large success in a short time.
2. Freecycle created an alternative disposal option that is rapidly growing. Discuss ways
that Freecycling might affect the purchase habits of consumers.
Answer – The world has become a more complicated place in terms of options and ways a
consumer has to buy or procure things. In addition to that, it is also very challenging for
many people to survive in a very tough environment as there are less number of jobs and the
economic conditions is not very promising in the medium to short term. In such a situation,
Freecycling is a very attractive alternative way for purchasing what one needs. For people
who are short on budget or who really believe that they want to be more responsible and do
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not mind reusing products used before, they could first look at the Freecycling website to see
what things they want and only buy if they do not find it there. It is also possible that a
certain section of consumers may not buy items under generic categories such as furniture or
electronics and wait for the thing to appear on Freecycle and get it from there. On the other
side, it could also lead to better business as well as giving away old stuff would lead to
people upgrading to new products and better technology that is good for the business
environment and in improving the economy as well. Therefore we can say that the concept of
Freecycling could impact the way a certain section of customers purchase by making them
not purchase but look at the website first to see if there is anything available for free and at
the same time, it could also contribute to new products being bought as customers now have
a guilt free avenue of disposing off products and hence create opportunities of upgrading to
newer products.
3. Should for-profit businesses like eBay get into the Freecycling business? Should
companies motivate more consumers to give things away that they might otherwise be
able to sell or auction? Can they still make a profit while they help to eliminate waste?
Answer – Companies in today’s world are playing a much more active role in society and are
active participants in making the world a better place. The concept of Freecycling can really
be very effectively leveraged and applied by companies, to help their customers help the
larger society and at the same time ensure they are operating profitably as well. Companies
can use the concept of Freecycling to encourage their customers to bring in their old products
such as clothes and mobile phones or any other products, collect them, sort them and then
organize them to be given to people who are needy. Businesses could probably tie up with
charities that could help them to ensure that the products are given to people who need them.
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However, companies should ensure that the products that are donated should not be bought
by other potential customers else their business may be impacted. Hence by tweaking the
Freecycling model, and playing the role of a facilitator who could help customers help others,
companies can very effectively use this concept to play a socially more active role and also
help increase their own sales of new products.
Case Study Analysis
Current Situation Analysis – We live in a world that is full of options and where better products
and solutions are always being launched that make our lives easier and better. However the
product life cycles are so fast that no sooner do we buy a product or solution, better variants are
launched and we want to upgrade to them. However, this era of continuous innovation also leads
to a lot of abuse of the environment, piling up of non-biodegradable waste that leads to pollution
and impacting the long term prospects of the planet we are living in. On the other side, there are
a lot of people as well who are not so fortunate, do not have access to money and would gladly
accept goods that others may not need. There could also be people who are aware of the damage
that continuous industrialization and manufacturing causes our planet and consciously not want
to increase that by buying more new products. This is the current situation where a world exists
where companies are trying to sell people new products, but they are not successful as people are
already overloaded with products, and there on the other hand exists people who are not able to
have access to products and services as they cannot afford them.
Problem Identification – As can be seen from the above discussion, there exists problems for
two kinds of entities. The first entity is the customer who has access to and has been using
products, but for reasons such as they are no longer needed or they need to updated, they want to
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dispose products. However the issue is they feel guilty of throwing off good products that would
sit in landfills and pollute the environment. The second entity is people who are seeking products
to use, but probably cannot afford them or do not want to pay the price that companies are asking
for them. However they would be grateful if they are handed over the products by people who
may not need them. However the issue for them is that they do not have any way where in there
can reach out to people who have these products so that they can collect it from them. Therefore
the problem that exists in the case can be stated as there being two groups of people who could
help each other in a manner that benefits humankind and also ensures a better and lessor polluted
world, but there being no effective or scalable manner in which these two groups of people can
share information which is critical for them being able to help each other.
Alternatives and Evaluation of Alternatives – Different alternatives that can be pursued to
address the above issue in a value creating manner are listed below
1. Information sharing platform that helps people to view what they have to offer and
contact them – From the identification of the problem above, we can clearly see that both
the entities can help each other, one by giving away their products and the other
accepting them. In this way, issue faced with both of them can be solved to some extent
as customers with money can buy new products or dispose of products that they do not
need, and the other customers can make use of products without having to spend money,
which they do not have or which they can better put to use elsewhere. If this transaction
can be made, then a very big beneficiary would be the environment and society as well as
a lot of pollution and harm to the environment can be prevented (Grida, Enrin, n.d) due to
products not going to landfills and they being used by other people. A very effective
solution that could bridge the information gap and connect the two types of customers
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together is by having an online platform where customer can post items they want to give
away and people who need them can browse them and contact the seller to buy them.
Information on the site can be organized in a manner that is easy to browse as it could be
by location or category to ensure that people can connect easily. They could connect
offline after they exchange emails and have the transfer of goods. This solution presents
all the solutions sought above, and does it in an easy to implement, effective and scalable
manner.
2. An independent company or charitable organization acting as a middleman – Another
option that could be thought to solve the issues identified is for an organization to act as a
partner in the middle who is able to collect the goods that are not required and then turn
over the goods to people who need them, thus very effectively playing the role of a value
adding intermediary who is able to connect the two types of customers. Though this
would be a good solution that would help solve the issue to an extent, this is not effective
due to physical and logistical constraints that make the solution non scalable and where a
lot of coordination and management and multiple travel is needed. This could prove to be
cumbersome to the parties involved that could eventually lead to them not using it.
3. Giving away the products through a special section on already established platforms
such as eBay or Amazon – Online market places like Amazon and eBay would be a very
attractive option and place for connecting the givers and seekers and help connect them.
This is a scalable solution and is directly aligned with existing set up and infrastructure,
and has the benefit of there being already a large number of existing customers that
would give a jump start to the concept. However these companies or similar companies
may not be ready to extend their platform to accommodate the concept of Freecycling as
Week 7 Case Study
this could impact their main business and people could want to look at free stuff before
they buy actual products, leading to channel conflict that could lower their profitability
(Lynn, F, 2008). Therefore this is not a preferred solution as it is not completely
independent and there may be conflict in the concept and objectives of the company that
already exists.
Recommended Course of Action – Based on an analysis of the various options that are given in
the above section, and considering that the solutions elected should be scalable, be applicable to
as many people as possible and work towards the benefits of all parties and society in general,
the first option discussed would be the most appropriate option to select in this case. This is
because it is an independent platform and hence can focus entirely and dedicatedly on its
objectives of benefiting the society without any commercial interest, and also is a scalable
solution that could potentially service millions of customers. In terms of implementation, it is
recommended that there is a thorough analysis done with select group of customers on what
features they need, launch the site and then add on more functionality as the site grows in
popularity and the concept is proven to work.
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References
Grida, Enrin (n.d). "The environmental impact of industrial and urban waste landfills."
http://enrin.grida.no/. N.p., n.d. Web. 17 June 2012.
<http://enrin.grida.no/htmls/romania/soe2000/eng/cap7/impact.htm>.
Lynn, F (2008). "How to Tell When Channel Conflict is Destructive - Strategy - United
States." Mondaq.com. N.p., 8 Mar. 2008. Web. 17 June 2012.
<http://www.mondaq.com/unitedstates/article.asp?articleid=57914>.