Jan 25, 2008

The economics (and biology) of free ice cream

When McDonald’s introduced ice cream to its franchises operating in Indonesia, it faced a problem: many people had lactose problems and would not buy the product because it made them sick. So what did they do? They gave ice cream cones away for free. You’d be surprised at what people will consume when its free, regardless of the associated nausea. After repeated exposure to dairy products, the allergic reaction diminishes such that people can enjoy the dairy product without any significant consequences. So sure enough, after a while the target market in Indonesia had lost its intolerance. This made McDonald’s (and I suppose the Indonesians?) happy.

From a fascinating blog post, cheekily quoted here in its entirety:

When McDonald’s introduced ice cream to its franchises operating in Indonesia, it faced a problem: many people had lactose problems and would not buy the product because it made them sick.

So what did they do? They gave ice cream cones away for free.

You’d be surprised at what people will consume when its free, regardless of the associated nausea. After repeated exposure to dairy products, the allergic reaction…