As a marketer, you say your new product or service is better, but how does the consumer know it’s better? Notice that they have to pay the cost to resolve that uncertainty.

Think for a moment about freemium. Whether it’s Dropbox, Pandora, The New York Times, or Skype, many software- or service-type companies use some version of a freemium. There’s an initial thing that’s free but they encourage you to upgrade to a premium version. In the case of Dropbox, for example, they give you two gigabytes of storage for free, but eventually, if you want more storage, you have to pay to upgrade. What does that do?