The Passive Voice has a post by author Tony Jones on getting his traditional publishers to offer his books for 99 cents. He notes:
Explain Amazon. Remind publishers that when someone buys one of your books for $.99, Amazon gets smarter about that consumer. Chances are, Amazon is going to start recommending other books by that publisher — full-price books — to that reader. Sales are sticky on Amazon, so even a $.99-sale that nets only pennies for the publisher will develop a connection between that reader’s Amazon account and that publisher’s other titles.
What's true for publishers with multiple titles is also true for authors with multiple titles. Earlier, there was a looong discussion about Amazon in the comments that went off on several different tangents. One I think is well worth reading--dig down through the comments here until you find Passive Guy's 4:00 p.m. comment (his are red), and read through the rest of that thread.
It's people talking about the KDP Select program on Amazon, and how apparently if you do a freebie through that channel, Amazon counts those as sales and starts using that data to recommend your title to other people who bought similar books.
Good to know if you are hoping to make an informed and rational decision about KDP Select....